With Colorado recently introducing fixed odds betting on horse racing on sportsbook platforms, Michele Fischer, Vice President of SIS Content Services, explains the positive impact this can have on the sport.
The launch of fixed odds betting on horse racing on Colorado sportsbooks should be considered a landmark moment. Not only will it benefit the sports betting landscape, but it will also be pivotal in ensuring horse racing thrives long-term.
The availability of horse racing in the same betting format as all other sports will maximize engagement and attract new customers to horse racing that may never have placed a bet on a horse race in their lives. It provides a boost to the racing industry and enjoyment to the sports bettors who will have content available around the clock.
bet365 was the first Colorado sportsbook to offer horse racing and it is expected that more operators will join as soon as technical integrations are feasible.
A new audience
The introduction of horse race wagering in a fixed odds format is not meant to replace pari-mutuel wagering, but to put horse racing in front of sports bettors.
There is a huge audience to tap into and engage with who are already familiar with the fixed odds format in other sports. Those who may have never been involved in horse racing or even watched a race before can appreciate the quickfire, short-form content available, with the next race only ever minutes away.
Unlike the pari-mutuel model, fixed-odds betting is far more approachable as bettors know what the potential payouts will be before a race starts. This is a positive for the casual bettor, who won’t experience price fluctuations.
Rather than working against the pari-mutuel system, fixed odds also can be complementary by offering more options for bettors through derivative markets. Putting selections in a parlay alongside picks from other sports or placing a bet on the favorite versus the field and other such novel bets are not available on the tote system and can enhance the wagering experiences of bettors.
Content
SIS, which is the largest global distributor of horse racing for fixed odds, has over 160 racetracks approved on the Colorado fixed odds catalog and is currently the only content supplier providing horse racing in the state. The SIS portfolio is robust enough to give operators races in a nearly 24/7 span, which is a critical factor to success.
The bulk of the racing originates from Ireland, Latin America and Australia, with domestic content being added as commercial deals are completed. Arapahoe Park is planning to have their races part of the fixed odds offering when the season opens on June 9, which will provide local interest to bettors.
Complexity
Horse racing is a staple on most global sportsbooks, but the U.S. regulatory structure is much more complex. The Interstate Horse Racing Act of 1978 paved the way for remote betting on the sport and requires certain industry stakeholder consent for an operator to be able to take a wager on a host racetrack. In theory, this law should have put racing ahead of other sports as part of the legal sports catalog, but regulators have moved forward with caution so as not to upset the existing structure of pari-mutuel wagering.
In Colorado, the Division of Gaming held industry stakeholder meetings for input into the regulation for sports books to offer horse racing as a fixed odds wager. Ultimately, in addition to the Interstate Horse Racing Act requirements, the Colorado horse racing industry also must give consent for domestic and international racing to be offered on state sportsbooks.
Therefore, in addition to the host racetrack being compensated for their content, Colorado’s sole racetrack, Arapahoe Park, and their horsemen’s group will receive a piece of turnover on all horse racing fixed odds wagering. It was important for this initiative to strengthen local racing.
To expand horse racing to all legal sports betting states, each state sports regulatory body will need to add it to the sports betting catalog. There continues to be varying opinions if legislation changes are needed to allow it.
While state racing commissioners oversee the running of the races, sport integrity measures, licensing of participants as well as pari-mutuel wagering, state sports regulatory bodies oversee licensed betting operators and fixed odds betting on all approved sports. Horse racing should simply be seen as another professional regulated sport in the sports wagering portfolio.
Stepping stone to more states
The inclusion of fixed odds horse racing on sports books will take time and the Colorado launch with the cooperation of the in-state horse racing stakeholders is a promising first step to expansion.
Other states, including Louisiana and New York, are seriously considering following suit. As seen with other sports wagering regulations, it is expected that each state will have their own spin on the inclusion of horse racing. No matter the details, the economic balance between the horse industry revenue and the cost of the content to sportsbooks must be achieved for the content to be competitive with other sports.
Several years ago, stand-alone legislation for horse racing fixed odds was written in New Jersey, which has failed to be conducive for sports books to offer the content on their platforms.
It is also vital that the horse industry understands that the sales and operations of racing for fixed odds wagering is much different than pari-mutuel simulcasting.
Future impact
The U.S. horse racing industry has benefited over the last 30 years from revenue generated by alternative gaming, but those vital partnerships have proven not to directly develop a new audience for the sport. However, having horse racing available in a fixed odds wagering format on sports book platforms specifically encourages betting on horses to people who like to bet, but might not have been exposed to the sport.
Ultimately, U.S. horse racing will be left behind if the sport and industry does not evolve. It is vital that horse racing is brought to the attention of casual bettors, and Colorado has taken huge steps to address this. The introduction of fixed odds betting presents a clear opportunity to secure the sport’s long-term future as an integral betting product in the U.S.
