Posted 3/5/2012 12:00 am
Updated 3 years ago
People still are placing bets at the state's two racetracks, but it's just not on horses or greyhounds anymore.
Instead, gamblers are pumping millions into the electronic games at Oaklawn Racing & Gaming in Hot Springs and Southland Park Gaming & Racing in West Memphis.
Since 2007, the first full year electronic gambling was allowed under Arkansas law, the amount of money wagered on those games jumped an eye-popping 502 percent at Southland to $1.3 billion in 2011 and 327 percent to $695.5 million at Oaklawn, according to reports on file at the Arkansas Racing Commission.
Because of the rush of customers, Southland is in the middle of a $10 million renovation project that will add 200 video gaming machines, bringing the total to 1,200, once the construction work is completed in May. (Click here for related story.)
Meanwhile, money wagered on horse racing at Oaklawn has declined.
Between 2007 and 2011, the total amount bet during the live racing season at Oaklawn plummeted 23 percent to $85.3 million in 2011. Attendance for the live racing season during that period also has tumbled 7.7 percent to just under 571,000.
"You're talking like we're doing poorly, and we're not," said David Longinotti, assistant general manager of racing for Oaklawn. "Oaklawn Park is doing quite well."
He said the numbers were down in 2011 because the racing season lost eight days because of bad weather.
Still, the horse racing industry is concerned about its survival.
"By any measure, thoroughbred racing has declined over the last decade," said Dan Singer, director of media & entertainment practice at McKinsey & Co. of New York, which conducted a study on the thoroughbred racing industry. His comments were made in August during a presentation of the report at a meeting for The Jockey Club at the Gideon Putnam Resort in Saratoga Springs, N.Y.
"In our view, the primary reason is a failure to innovate fast enough and well enough to compete for new fans and bettors."
In the last decade, the amount of money bet at racetracks across the country is down 37 percent and attendance has fallen 30 percent, according to McKinsey's study. The study also reveled something even more troubling for the industry: Thoroughbred racing is losing fans at the rate of about 4 percent a year.
But McKinsey & Co. suggested some strategies to boost interest in the game, including pushing for more television coverage.
The lack of fan interest isn't a surprise to Bill Thompson of Las Vegas, author of "The International Encyclopedia of Gambling." Attendance numbers and the amount bet on horse racing has been on a steady decline since the 1970s, he told Arkansas Business last week.
"Racing is just not a product the public wants," Thompson said. "It's a very boring product."
Longinotti, Oaklawn's assistant general manager of racing, said Oaklawn is drawing about 10,000 to 11,000 fans during its live racing season, which is about 50 days and lasts from mid January to mid April.
"From Oaklawn's standpoint, what draws patrons is high-quality racing," he said.
Longinotti said Oaklawn is able to attract better horses because of the purses it pays, which is funded partly through the profits of the electronic games.
Between 2007 and 2011, the total amount paid to the horses' owners increased 11.4 percent to $15.8 million..
Longinotti said Oaklawn still is an attraction because "there is still an appreciation of horse racing as a sport. It's not just an opportunity to gamble.