Jockey Change - Belmont, 6/10, 12th race

[marcus]

i definately want these guy\'s in - but their ability to wager so to close to pool closing is something which everyone should have the abilty to do regardless of the location of where the wager originates from , it\'s an issue that needs to be addressed ...  i don\'t advocate closing these practices down but the technology does give an unfair advantage to the user - of course they still have to pick a winner .
 

[jmetro]

marcus Wrote:
-------------------------------------------------------
> i definately want these guy\'s in - but their
> ability to wager so to close to pool closing is
> something which everyone should have the abilty to
> do regardless of the location of where the wager
> originates from , it\'s an issue that needs to be
> addressed ...  i don\'t advocate closing these
> practices down but the technology does give an
> unfair advantage to the user - of course they
> still have to pick a winner .

That\'s just it, these bettors have more sophisticated technology than the race tracks, or at least it seems so.  We\'ve all seen horses odds drop from the time they leave the gate until the time they finish.  Tracks say they need 45 seconds to \"batch\" their bets from simulcasting outlets, causing the delay in odds posting, yet the whales evidently have techonology that does it in a matter of seconds.

[imallin]

Everyone DOES have the ability. If you bet 10 or 20 million (or more) a year, i\'m sure some rebate shop will gladly take your action and if you can write your own computer program, i\'m sure they will let you in on this computer betting.

I could see if they said that only certain people could do it, but if you are a big bettor, i\'m sure there\'s a rebate shop that will take your action and give you whatever you want.

[asfufh]

If you think this \"scourge\" is going away, think twice.

Here\'s some excerpts from Youbet\'s May/06 conference calls. You have to read between the lines. Like saying the CRW whales don\'t win all the time...yea, right thats because they are grinders using historical probabilities....over time they win (big!, especially with the benefit of rebates) because of their unfair advantage of timing and access.

How many times have you tried to bet at the last possible minute only to be shutout or see the odds change against you after you bet. The tracks let these guys bet thousands at the last second and, in addition, let them electronically access the track\'s tote system to calculate the correct amount to bet ,for example, on each exacta combination that is more than their model determines is historically correct. As someone suggested, one possible way to screw up these systems is to require them to process their bets a couple of minutes before the pools close...I think the end result if this rule was instituted would be they wouldn\'t bet anymore. These guys are not horseplayers!!! Asfufh

Youbet.com Q1 2006 Earnings Conference Call Transcript (UBET)
Related Stocks: UBET


Youbet.com (UBET)
Q1 2006 Earnings Conference Call
May 4, 2006, 9:00am Eastern

Executives

Richard Land, Investor Relations Counsel
Chuck Champion, Chairman, President and CEO
Gary Sproule, CFO
Scott Solomon, General Counsel
Lonn Powell, VP Public Affairs.

Analysts

Ryan Worst, Brean Murray, Carret & Co.
Mark Agento, Craig-Hallum Capital
Todd Eilers, Roth Capital Partners
Traci Mangini, Think Equity Partners
Steve Altabrando, Sudotee and Company

Presentation/Champion:

Also, we're in the process with the ORC, Oregon Racing Commission, in testing CRW. CRW is Computer Robotic Wagering. We're working on an individual basis with tracks a well. What CRW allows is high end individuals to place bets in a paramutual pool through the same type of transparent compliant systems that others do. They don't have any incremental access to data. Obviously their bets have to be taken like everyone else's prior to post. We're scrutinizing and watching that business very carefully. By allowing this process to take place we're attracting larger bettors to the pools. We think it's going to be very positive in the long run and we're working on that test. We expect that at the completion of that test in June we should be having CRW integrated in our overall operating plan in Oregon and will be offering it to others.


Q&A:
Traci Mangini.

And then just lastly on the CRW system, the robotics wagering. If you could give a little more detail on the mechanics of how that system works. I'm assuming that it's going to diversify your high volume customer, maybe make more of a younger demographic than say your Wales and IRG. Is that correct?

Chuck Champion.

Actually, I'm not sure about the demographic mix. A couple of individuals that we've talked to about this and are engaged in it are frankly not 22 years old, they're probably 45-50 years old. Basically, what the system allows is that a person using mathematical formulas looks at all of the race data available and handicaps each and every horse on a statistical basis and then determines, based on these statistics, exactly what the horse should go off at, and the monitors that up until about 2 minutes before the pools close and make bets, makes a bet into the pool where they believe value exists. It's really, in some senses it's not different than what another handicapper will do. It's crunching a lot more data a lot more quickly and then giving the individual the opportunity to place a number of bets fairly quickly. Again, they're not batch bets, they're individual transactions. We don't allow anyone to batch 50 bets and send them in. we don't allow an individual to collect bets from other people and then send them in. this is something that comes off of their computer programs and they have to place the bets.

We've given the individual the technology in order fro them to do that and also maintain full transparency into what they're doing, how they're doing it, track each and every piece of their business. But, it's basically individuals that are not your ordinary handicapper, if you will. They're not individuals that have been around horses and racing all their life. These are guys for the most part that are extremely intelligent, well-educated and have spent time in the mathematically world and in the gaming world, as well, playing skill-based games. One individual, for example, is a chess master and a backgammon champion and he's got the most amazing mathematical mind one can meet. He's developed programs that find the value in the pools and he places bets against them. He doesn't win all the time, by the way. So it's not like it's a foolproof system where the guy places the bet and he's absolutely sure he's going to win. He just improves his chances because of all the statistical information that he can crunch. But he's getting no different statistical information than anyone else in the industry has access to. So, he doesn't have a special advantage from that standpoint. He's getting his information from the same data providers that everybody else is. He's just doing it in a faster way and with different types of programs that he's written.

Others do the same thing, their programs are just slightly different. They are very large players. They add liquidity to the pool because, again, they don't win all the time. They have better percentages, but they don't win all the time. So when other handicappers figure out one horse is better than another, there's usually greater odds spreads. So those individuals who really figured out when the big guys lose, they're usually rewarded to a greater extent. And that's why we think it's positive for the pools. But we also believe it's up to each track to decide. Each track is making the decision as to whether or not they want computer robotic wagering in the pools or not. So we turn it on at certain places and it's turned off at others. It's part of the conversations we have with the track.

[miff]

The guy described is fairly well known and was SUPPOSEDLY stopped from betting into the NYRA pools.

1. He was about break even and after rebate made app5-6% on volume.

2.The Ceo Champion is either a liar or misinformed.

3.There is no \"value\" or inefficiency being exploited.

4.The computer software indentified opportunities to place many bets,seconds before post with a high probability to break even or lose up to 6/7% mainly on exactas. The rebate was 10% yielding a consistent small profit.

5.Each time the computer saw the opportunity to prfit/small loss it executed accordingly.In all of those instances the PAYOFF of the winning exacta went DOWN and if YOU had it also, you got less(unable to say how much).

6.The one I am familiar with was nothing more than a \"skim\" off all players.


I understand it only works in big pools(NY, So Cal)I understand that more than one guy doing it basically renders the skim close to useless.There is NO JUSTIFICATION for anyone to have access to \"belly of the beast\" pool info unless ALL players can have it.

Mike

[TGJB]

Just so we all understand what\'s involved here-- this is basically a) someone creating a betting line and betting using it, b) a discount for volume (rebate), and c) software used to facilitate transactions (like in the stock market). The discount for volume is the same as in any business (again, like the stock market). If the line you come up with (meaning the handicapping) is bad, it doesn\'t matter what software you use to put in bets with, although the rebate will certainly help. But that\'s true whether you use software or not.

The big concern here is security, past posting. If that is dealt with, there is absolutely nothing wrong with anyone using technology to beat this market, just as many have used it in others.

[miff]

JB,

Given the brilliant computer minds of today, I find it unacceptable to let anyone with a computer program remotely near the pool data even to facilitate multiple large late wagers.

I do not have enough confidence in race track managers to ensure 100%integrity,I do on Wall street(in this regard) where there is all kinds of external oversight.


Mike

[TGJB]

Miff-- this brings up an entirely different question, and while I don\'t agree about the betting software (they could simply be shut off when they start to load the gate), I do agree on the bigger issue. That suggestion about having an ombudsman (and not just re betting, more for drugs) would be a step in the right direction. But if ever an industry cried out for federal oversight, this is it-- my hope is that if (when?) Congress gets busy with baseball, it will scare the crap out of \"the industry), and make them take all this stuff seriously. Baseball\'s pain could be our gain.

[miff]

JB,

Not to waste your time but any betting software is not TOO FAR from the amateur bettors(yet computer geeks)that past posted the pick six just two years ago.

Can you imagine if the amateur bettors were sophisticated gamblers who made a \"real\" looking or multiple pick six ticket.They could have spot played and maybe never been caught.

My point is that if guys like E.D. need that type of accomodation and there are external checks and balances, then OK,otherwise no.


Mike

[imallin]

Mike,

all players Do have it. You just have to bet 10 million (or more), be signed up with a place that permits it and have the intelligence to construct the software and implement it and all that good stuff.

It SEEMS like we all don\'t have access, but  we do. Its not the fault of the whales that you don\'t have the financial power to bet 10-20 mil or more a year.

What it comes down to is this. We SAY \"if all players don\'t have access, no one should\" but we MEAN, \"because i\'m not financially able to get access myself, i want to condemn the bigger bankrolled players way of doing things\"

Now, what WOULDNT be fair is if you DID have the ability to wager millions upon millions per year and were with a certain company and they told you, \"no, this is only for a certain few\"

Believe me, if you find a place and were betting millions (and making that place a fortune) the first thing they want to do is put you in a position to be able to bet as much as you possibly can.

Who\'s to say that that particular way is NOT the best way to do things? Because most horseplayers don\'t have the intelligence, bankroll or desire to bet in this fashion, doesn\'t mean that we should condemn those taking an edge where they can get it.

More power to em.

I WANT these guys in the pools...they aren\'t handicappers, they are \'dutchers\'. They spread money on tons of different combos....its not like they are hammering one or 2 numbers...they are betting hundreds and sometimes thousands of combos...thats good for me and you the way i see it because only one combo can win. If you get the winner, their losses on the other combos help boost your price.

[BitPlayer]

TGJB -

Preventing past-posting may be your chief concern but it\'s not mine.  What I want is disclosure of the rules.

I\'ll start taking your stock market comparisons seriously when horse racing prohibits trainers (the ultimate insider traders) from betting and giving tips to others.  Efficient markets, in theory at least, benefit us all by efficiently allocating resources.  Efficient pricing of exacta combinations makes losers of us all.

Horse racing is not a market.  It is an entertainment; a zero-sum game that I can choose to play or not.  In most games, the ability to take advantage of technology is limited in the interest of fairness.  Think aluminum bats or NASCAR.

I think, and I think most would agree, that in a parimutuel game, the ability to bet last, knowing what everyone else has bet, is an advantage.  If tracks are giving batch bettors that advantage, I want to know it, so that I can decide whether to play. I would also like to know if some players are being given access to Pick-3, Pick-4, trifecta or superfecta wagering data before wagering has closed.

What irritates me is that whenever these issues start to be addressed, people who either don\'t understand my issues or want to sweep them under the rug, change the subject to past-posting.  Yes, past-posting is unfair, but I think other things associated with rebate shops are also unfair.  I\'m not asking to make the rules.  I\'m asking to be told what they are, so that I can decide whether I want to play.

[miff]

Imallin,

From your post you do not understand the skim I\'m talking about.You never get more on your winning combo, always less, they bet every combo(for different amounts) with the software I\'m talking about.

There are several variations of this I hear but I\'m only familiar with one.As far as big gamblers/rebaters just handicapping without software, I agree, let them all in.

Mike

[marcus]

imallin -  though  what your saying is true , your changing the subject a little bit ...

[asfufh]

JB, I don\'t think a pari-mutual pool is a true market like the stock market.
In the stock market, there has to be two sides(i.e a buyer and a seller) to every specific transaction at a specified price at a specified time .
In a pari-mutual situation,there is no matching of specific transactions like in the stock market.A horseplayer(at least here in the USA) doesn\'t know the final price (odds) of a transaction until after the player has made the purchase(bet) and the pari-mutual pool closes.
Because of the way pari-mutual pools work, a tremendous advantage is created for anyone who knows the final prices(odds-payoffs) just before they place their bets in a pari-mutual setting...an advantage that ,by definition, doesn\'t exist in the stock market.
It\'s like having the button in every deal in Texas Hold\'em.
Computer robotic wagering gives this advantage to a few at the detriment of the other pool participants and should be banned in order to keep pari-mutual betting fair and equitable. Otherwise, we ought to change the whole wagering process over to a betting exchange system (eg. Betfair) . Asfufh

[Boscar Obarra]

  Splain to me how they \'skim\' by betting every combo?

  Can\'t be done. You have to have some kind of an opinion, and leave something out.

   You all are correct, that overall, they probably REDUCE the payoff on the winning combo most of the time, but that\'s because they have some opinion/info that lets them focus on the live numbers.


  The Legendary Stan Bergstein has some audio interviews on the net, the most recent talks of rebates, state of racing , etc.

 http://www.harnesstracks.com/worldinharness/archives/archivepage.htm