WHAT A LIKELY DECLINE IN SLOT-MACHINE POPULARITY PORTENDS

Whenever I go to a racino and walk through the gaming rooms, I wonder how the typical scene of mostly older people playing slot machines will change in the not-so-distant future.  Casinos are increasingly likely to have the same problem that Facebook is experiencing, with the loss of younger patrons to its Instagram platform, TikTok, and other social media sites. (Facebook recently changed its name to Meta Platforms Inc. in order to escape the stodgy Facebook reputation among younger people and also to pursue virtual reality ventures that will appeal to them.)

A precipitous decline in slot-machine revenues is a concern for horse racing—or should be—in that they supplement purses.

The topic of slot machines becoming passe was discussed recently at the East Coast Gaming Congress in Atlantic City, New Jersey.  According to Fox Business, the main question was “how to get young people interested in what casinos have to offer.”  The possibilities were “skill-based” games, as opposed to games of chance, such as esports, sports betting, and electronic tables games.  The CEO of Spectrum Gaming Capital said, “We think esports is the next big thing.  Every casino company I’ve talked to is interested.  This is happening.”

While a marked decline in slot-machine popularity would adversely affect horse racing, the news is not all bad.  Handicapping horses is a skill-based endeavor that can be done at a racetrack or remotely via internet or phone.  Properly marketed, handicapping would be far more appealing to folks who play digital games and live on their cell phones, so to speak, than going to a brick-and-mortar casino and pushing buttons on slot machines. 

However, to what extent will racinos creatively and aggressively market the racing product?  Churchill Downs certainly will because its TwinSpires betting portal is a major revenue and profit center.  Whether Penn National Gaming and other casino companies in which horse racing is a minor product line will do so is problematic.

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