Archives for June 2022

Midland, Texas has been home to some of the most notable people in both the Lone Star state and globally, including two presidents of the United States, George H. W. Bush and his son George W. Bush, and 4-star General Tommy Franks.  Several successful racehorse owners have Midland connections as well–for example, Ralph Lowe (Gallant Man) and Barry Beal and Robert French (Capote and Landaluce).  The name Scharbauer has been prominent in Midland for over 125 years…in ranching, oil, banking, and horses, especially a horse called Alysheba.

In 1959, Midland wildcatter and racehorse owner Fred Turner won the Kentucky Derby with Tomy Lee, ridden by Bill Shoemaker and conditioned by Hall of Fame trainer Frank Childs.  A quarter of a century later, Turner’s daughter Dorothy, wife to Clarence Scharbauer Jr., decided that she wanted to try to repeat the thrill she and Clarence experienced at Churchill Downs when her father’s horse won the Kentucky Derby.  Author Jimmy Patterson (not to be confused with the novelist James Patterson) has masterfully chronicled the chain of events that ended with Dorothy achieving her goal.

Award-winning author Patterson, whose previous books include “The Story of Midland Texas” (2014), had the cooperation and first-hand accounts of three of the key players in the Alysheba story: Preston Madden, the colt’s breeder; Jack Van Berg, Hall of Fame trainer; and Chris McCarron, Hall of Fame jockey. Clarence and Dorothy Scharbauer are deceased, as is their daughter Pamela Scharbauer, who co-owned Alysheba with her mother.

Alysheba’s path to racing fame began when the Scharbauer’s purchased him in 1985 for $500,000 (equivalent to about $1.4 million in 2022) at the Keeneland yearling sale and culminated with the colt winning the 1988 Breeders’ Cup Classic.  He retired with earnings of $6,679,242 (equal to $16.5 million in 2022) from 26 lifetime starts, in which he had a record of 11 wins, 8 seconds, and 2 thirds. 

Alysheba’s winning run in the 1987 Kentucky Derby came close to ending in tragedy. About a sixteenth of a mile from the finish line, Alysheba was running second and clipped heels with the leader Bet Twice and nearly fell.  McCarron was able to steady the colt, who somehow recovered and courageously rallied to pass Bet Twice.  A pileup of horses had been averted and Alysheba was on his way to a storied career. Besides being in American racing’s Hall of Fame, he is number 46 on Bloodhorse magazine’s list of the 100 best American racehorses of the twentieth century.

“The Glorious Run of Alysheba” is 112 pages in length, is very well researched, and the presentation flows smoothly. Racing fans who remember watching Alysheba can enjoy revisiting his exploits and fans without that recollection can learn about a remarkable racehorse and fan favorite.

Copyright © 2022 Horse Racing Business

As with the 2022 Preakness Stakes, the 2022 Belmont Stakes did not have a lot to offer to interest bettors and television viewers…and the results reflect this reality.  With the connections of Kentucky Derby winner Rich Strike skipping the Preakness, there was no possibility of a Triple Crown winner and the field for the Belmont did not have star power or the prospect of an intriguing matchup.  The main draw was to see if Rich Strike’s win in the Kentucky Derby was a fluke.

All-sources betting was $98.8 million, compared to $112.7 million in 2021, which was a wagering record for a non-Triple Crown year.  This was a decline of about 12.4%.  While on-track betting on 13 races was $9.5 million, up from $7.5 million in 2021, the contrast is meaningless because in 2021 NYRA limited attendance to approximately 11,000.  All-sources handle on the Belmont only was $50.3 million, a decrease from 2021 when the handle was $60.5 million. 

Television ratings were tepid.  The race portion of the Belmont Stakes earned a rating of 2.65 and had viewership of 4.72 million people.  This was up slightly from 2021 but was the third smallest TV audience since 2000.

The paid attendance was 46,301 but not much can be read into this statistic.  Due to construction of UBS Arena on Belmont property, NYRA capped attendance at 50,000.

In 2022, the Triple Crown business metrics were strong for the Kentucky Derby and modest for the Preakness and Belmont. Regardless of the sport, absent star power, an event won’t attract as many fans as it would with a Tiger Woods, Serena Williams, or an American Pharaoh.

Copyright © 2022 Horse Racing Business

Wayne Perry of the Associated Press recently wrote an informative article about the growth of sports betting in the United States since the nation’s Supreme Court rendered a decision in 2018 that enabled states to legalize it.  Following are several key points reported by Perry:

Since the Supreme Court’s decision on May 14, 2018, 35 states and Washington D. C. have legalized sports betting.  It is already operational in 30 states with others, such as Ohio, close to operational. 

As of mid-May 2022, bettors in the United States have wagered $125 billion legally.  This is more than the net income for farmers in 2021 and exceeds the amount spent last year for pet food, supplies, and veterinary care.  The $125 billion does not include the amount bet illegally.

80% of sports bets are via mobile phones. 

In-game betting is the fastest growth segment of sports betting.

The overarching question for the horse racing industry is whether sports betting mostly cannibalizes or fosters pari-mutuel wagering.  Sportsbooks typically have a takeout rate of less than 10% of the betting handle, whereas the takeout in horse racing is much higher…and in some cases with exotic bets over twice as much.

Horse racing is experimenting with fixed-odds betting (an unfortunate nomenclature) to incorporate an attractive element of sports betting.  This and innovations like in-race wagering emulate proven advantages of sports betting.  However, the extent to which sports bettors can be attracted to pari-mutuel wagering is problematic, given the disparity in takeout percentages.  On premier race days like the Triple Crown events and Breeders’ Cup, people who do not normally bet on horse racing often partake.  Whether fixed-odds betting, in-race betting, and other elements of sports betting can bring in sports bettors on pedestrian race days is the predominant issue for horse racing.

Copyright © 2022 Horse Racing Business