Vic Zast

From the perspective of being an owner, an industry pioneer in corporate sponsorship, a track president and fan, Vic Zast writes the "Destinations" column for The Blood-Horse. His five-star ratings of international events have shed light on racing in all corners of the globe - from England, Australia, Hong Kong, Dubai to Japan.

Vic is a regular contributor to MSNBC.com, a columnist for the Illinois Racing News and has written on racing for ESPN.com, National Public radio and The Age, Australia's leading daily.

Vic makes his home in Chicago and lives in Saratoga Springs in August.

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Monday, February 21, 2011


Science Fiction, Watson


(CHICAGO, IL – February 21, 2011) Even before the computer Watson clobbered its two human competitors in the men vs. machine showdown on Jeopardy last week, horse racing should have been on the alert for possibilities that technology might bring to the handicapping process. The length of time that it takes for people to learn how to read the past performances has forever been viewed by the sport as a detriment to creating new fans. Artificial intelligence may be able to solve the problem.

Educating the uninitiated, an idea that’s countercultural and downright ludicrous, has been the superficial solution of port-brained operatives who refuse to accept that most people prefer knowing to learning. Like cavemen teaching apes to use pieces of stone to write on the walls of their shelters, these proponents of organized instructions for prospective fans have made little progress at anything and now represent a species endangered. If nothing else, Watson gave proof that machines can be endowed with the mental agility of Homo sapiens. Someday soon, they’ll be doing their work.

“I, for one, welcome our new computer overlords,” wrote game show contestant Ken Jennings on his Jeopardy drawing board after suffering a beating by the room-sized computer. Up until Wednesday, Jennings had emerged on top in 74 straight Jeopardy bouts against humans. Facing Watson, he seemed to be slow with his answers and lacking knowledge. The machine, on the other hand, was quick to recall all that was lodged in its “brain” and able to untangle convolutions. Watson was, in effect, solving problems. That’s what betting on horses requires.

Horseplayers enjoy the mind game that handicapping offers. They get an intellectual boost from winning and losing. Being wrong is what keeps them involved despite squandering fortunes. Dopamine levels spike to delirious highs when a horseplayer wins because losing is normal. Under the spell of this human cocaine, the gambler believes he can beat an impossible game. Like in golf or with video games, facing the challenge, not overcoming it, is the ultimate quest.

One reason the challenge can never be met is because horseplayers are dealing with information about events that have happened. What has happened has only some bearing on what will happen next. No matter how sophisticated the data available is, it will be only somewhat predictive. Horseplayers rarely admit that they lose because they’ve looked backwards instead of ahead – it’s always the high rate of takeout or the fault of another or some other injustice that screws them. Doesn’t that tell you how strong their belief in the unknown is and how powerful their confidence gets?

Given the tendency for people to believe in themselves, the computers of the future could produce better wagering results than those achieved by an experienced handicapper. Artificial intelligence that's delivered without burdening the horseplayer with the task of analysis could be delivered in a variety of ways. By tapping an app on the face of a telephone and keying in questions to Watson, the patron could summon up a variety of information without having to know how to search for it. What would make this delivery of service appealing is that it would provide options, not conclusion, unlike conventional tip services that start at the end, destroying the fun of the puzzle.

In mere seconds, Watson could analyze the data that advanced players pour over for hours. It could sort out the probabilities associated with each horse in relation to the odds so that bettors know the underlay and overlays in comparison to factual history. The limitation to having an instantaneous answer for any question is merely a function of budget. If the sport locked up the intelligence provider with a license to manage the program’s distribution, such delivery of information could provide racecourses an opportunity to offer patrons something they can’t find at simulcast outlets or online.

Nevertheless, handicapping by having a machine do your research would be so popular with fans that there’d be no restricting it. For the game to refrain from capitalizing on the enormous bounties that would flow from providing the uninitiated instantly with knowledge that takes years to acquire would be difficult at best. Moreover, who’s that organization or person to work on behalf of the many and determine what’s best for the sport? The simplest of things are damn near impossible to organize.

What makes these possibilities even more science fictional is that horse racing doesn’t have the money to take on a project of this scope, even if it possessed the vision. Racecourse owners have arms too short to reach into the bottom of the bags filled with items that need funding already. The industry’s disorganization interferes with its abilities to tackle challenges. Its structure, based on 30 different states determining 30 sets of rules, is antithetical to teamwork.

It would be interesting to know what emotions are being felt in the hearts of the strategic business planners at a publisher of data such as the Daily Racing Form or organizations such as the Thoroughbred Racing Association and The Jockey Club with their Equibase Company asset - entities that derive their purpose in being to fact collection. The unprocessed information that horseplayers receive now from these sources are headed for obsolescence. As a reference tool, the information used for handicapping horse races will be as out-of-date as casebooks for lawyers and medical journals for doctors soon. A de-emphasis of the importance placed on reading the archaic language of past performances will lead to a need for being more observant of proceedings.

Ironically, an information delivery revolution might be just what is needed to turn horse racing’s fortunes. Theoretically, the sport’s opportunists can turn to Watson to open wide a fascinating game to audiences that heretofore couldn’t understand it. Once they do, all the impatient, attention deficit-plagued, give-me-the-baby-without-the-pain types may become interested in gambling the cool way.

Vic Zast posts his ideas about horse racing regularly on Facebook.com and Twitter.com. Please visit him there.


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Monday, February 14, 2011


Metacognition


(CHICAGO, IL – February 14, 2011) Paul Roberts, the British racecourse consultant, is back in Saratoga Springs on St. Valentine’s Day. He’s the darling of the New York Racing Association. Since Roberts came aboard in 2008, a large part of his job has been to get the people of Saratoga Springs, who know about Saratoga Racecourse, to teach him about Saratoga Racecourse, so that he can teach NYRA about it. Another part of his job is to advise NYRA on how to spend its hard-fought gains from the Aqueduct racino wars in a way that will update Empire State horse racing suitably.

Some people would complain that NYRA, by hiring Roberts, has placed an expensive and unnecessary step between them and the fans that they serve. Other people would incorrectly assume that the highly-paid executives of NYRA should know what to do because of their own capabilities. Still others might argue that there are plenty of professionals already suited to serve Roberts’s purposes right under their noses – Sheikh Mohammed restored Greentree with local talent. And there are others, specifically those who have tried to bring much-needed change to a place where change isn’t wanted, that are perfectly comfortable with NYRA’s decision to bring a stranger in – in fact, they are thankful.

“Until you know that you don’t know, you don’t know,” was the advice of Aristotle, the father of metacognition. John W. Santrock, a professor and the former chair of Psychology at the University of Texas at Dallas, defined metacognition as “knowing about knowing.” Wisdom comes only after we become wise enough to understand that we don’t know everything. Having someone on the outside to fill you in on what you don’t know is a practice that’s prudent. On the other hand, not knowing squared produces compounded stupidity.

Before the Internet, there were probably as many people as there are today who considered themselves experts in a given field even though they knew nothing. But with the freedom to express oneself at the drop of a hat, unknowing people these days are able to pop off with occasional consequence. Technology seems to have emboldened society beyond its true capabilities. The sport of horse racing – oh heck, make that the world - is rife with egotists.

One issue that’s been wrought by intellectual narcissism is the debate over takeout. Many gamblers, having scant idea of how much money it takes to run a racetrack, are convinced that the handle would grow and shed bigger proceeds for operating the track if less money was taken from the pari-mutuel pools. They use examples where this has been true for short periods of time to make their argument. But they refrain from explaining how the benefits that flow from a buck bet are to be met if their proposition is faulty.

The argument over exchange wagering provides a similar example. Opponents of exchange wagering worry that the popular scheme will scalp the pools that exist, leaving the tracks even more wanting than they are from the rake that they take from wagers made away from their premises. Proponents rightfully say that exchange wagering is the boost that the sport needs to attract young people, provide a fairer shake to the faithful, and make horse racing a more attractive alternative to games of chance that subtract dough from their players slower. Both proponents and opponents would be better off by leaving the decisions to experts.

Granted, the experts haven’t always performed expertly. Horse racing’s behind the times, fraught with entanglements caused by its own doing and appearing unable to reach consensus on anything – a little like Washington, perhaps. But takeout rates, exchange wagering, casino partnerships, legislation liaison and a plethora of other preoccupations that get the public’s ire up are not petty annoyances that will disappear at the wave of a wand. Coincidentally, it’s worth noting that a lack of intelligence and experience was not the cause of these troubles. It is, for the most part, a short-sighted view to make money at any cost that threatens the sport with extinction.

Malcolm Gladwell, the author of Outliers, wrote that 10,000 hours of practice are needed before you can claim to have mastered a field. Even geniuses in the three fields where child prodigies exist – mathematics, music and chess – require long periods during which they are deeply immersed in a subject before becoming fully developed in it. It is ridiculous to believe that people with experience on only one side of an issue can provide dogmatic positions with ultimate confidence on issues that have many sides.

The changing landscape of what constitutes sport, including horse racing, has created a news environment that’s made practitioners stretch beyond their experience. Last week, Alex Waldrop trotted out an old NTRA research study that claimed one of four US adults are fans of the sport and that five million unique individuals visit a track or an OTB facility twice monthly – a mathematical conclusion that no research professional or fool with an abacus could support. Turf writers, with the sufficiently-developed skills to break a horse race down, interview its participants or recognize the stories that would intrigue readers, often veer recklessly into debates about business, legislation, finance and marketing for which they’re unprepared to participate. Bloggers, thrilled by the ability to have their own voices heard, produce monologues that amount to white noise, rarely accepted with respect because they lack depth and substance.

Aside from publications such as The Blood-Horse and Thoroughbred Times, where the wherewithal exists to hire a specialist to cover the business side of the industry, the breeding side and the racing side, there aren’t many public forums where an opinion on all these topics are legitimate. Reckless opinions fly like flak, wounding those who happen to be targets. The cacophony of a million words colliding in cyberspace has become content for the masses - who, like the character George VI in The King’s Speech, say a mouthful when they can’t hear themselves think.

Vic Zast posts bits about horse racing and other things on Facebook and Twitter.




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Monday, February 07, 2011


Game Changer


(CHICAGO, IL – February 7, 2011) Before Gov. Chris Christie came to Chicago on Friday to bribe Illinois businesses to move to New Jersey, he signed an assisted suicide bill for his state’s horse racing business, or so some people would have you believe. The bill makes it possible for Garbage State racetracks to engage in exchange wagering - the enormously popular, computer-required product that’s changing the game of gambling.

One such person is a former consultant for the European Pari Mutuel Association, Carlo Zuccoli - a flamboyant Italian (is that redundant?) who pens the Internet site nelrossodelluovo.com about horse racing in the UK, a country where Betfair is killing the bookmakers’ trade and lowering the cash contributions from punting that go to support purses.

“Ciao, horse racing in America,” said Zuccoli, sarcastically. He considers exchange wagering a curse - an invention that provides “peanuts” financially to the racetracks, drains money from the tote, encourages race-fixing and won’t maintain liquidity if the commissions negotiated are anywhere near what US tracks should demand.

North American racetracks made a crucial mistake decades ago when they began selling their product to off-track horse racing retailers at rates that are too lean to compensate for revenues lost by the exodus of gamblers from their premises. “We have to have a partnership where they have a vested interest in our success and we have a vested interest in their success,” observed Stephen Burn, the smooth-talking president of TVG - the new owner of Betfair, in a telephone interview. “But, equally, we can’t keep putting the price of the product up in a way that marginalizes fans,” he added.

The number of fans at racetracks has been dwindling for nearly four decades and even Burn will admit that exchange wagering will do little to help attendance. Nevertheless, the Betfair czar argued unconvincingly that players will begin taking their laptops to the races, that they’ll use smart phones to make wagers from their seats and that his company’s sponsorship of stakes races boosts the gate. “Racecourses in the UK are seeing their hospitality program numbers through the roof,” he remarked, in what was his biggest overstatement – an unfounded “credit due here” appropriation.

Regardless, attendance has always been the responsibility of racetracks, so Betfair shouldn’t be charged with the job of creating fans. Perhaps someday the sport will experience a true divide – a small number of fans, who come out to the track for the animals, the food and the ambiance, will stand apart from the gamblers, who hole up in their homes with computers – but it’ll be a shame if it does. Or is that what the sport has come to already?

Of the two fan groups in horse racing’s future, it’s the gamblers who most crave exchange wagering. They will pay commissions for winning that are tiny in comparison to current takeout rates in the pari-mutuel system. An exchange enables a player to back or lay horses at fixed odds, avoid breakage disparities and hedge bets while races are being contested. Betfair will create a rebate program to attract “whales” in order to protect its liquidity during the start-up stages. The company is convinced it will draw younger players into the game because of the concept’s dynamism.

Demographically, Betfair’s customer base is a generation younger than the racetracks’. The sport has been attempting to attract the emerging computer-savvy, tech-oriented audience through social network marketing for a half dozen years; it seems to be making little headway with this initiative. But Jeff Platt, president of HANA, the 1800-member strong community of horseplayers, believes Betfair’s technology – dedicated to serving the gambler with lower takeout - may produce better counts.

“Look at the music industry,” offered Platt on the telephone, using a most unfortunate analogy. “Along comes a group like iTunes and they totally revolutionize the music industry. Now you have millions of people downloading just the songs they want for 99 cents a song and you see growth in the music industry,” he argued, making the common mistake of automatically connecting low prices with a sounder business.

For the record, music sales have plunged to $6.3 billion from $14.6 billion in the last decade, according to the Recording Industry Association of America. Creating availability of product and lowering prices have not helped record sales, but have harmed them. Musicians and singers are reacting by developing Internet stores for products that bear their names, pumping up the volume on concert touring (including the concert ticket prices) and stretching their resources out into other realms of entertainment like never before. What Platt could have said, with more thought for the good of the game in mind, is that the industry will have to learn how to live with exchange wagering and prosper with it. That, not the price of a download, is the big issue in this.

“It’s unclear if the betting exchanges have helped or hurt racing in the UK,” said Alastair Donald, managing director of the International Racing Bureau, from a perspective that’s completely opposite, at least, geographically, from Platt’s. Horse owners and trainers will have something to say before they give it their imprimaturs. “Betfair has had a lot of bad press, but most of that press is the bookmakers who were keen to see it fail,” Donald noted. Burn explained it slightly less diplomatically. He said, “What (our competitors) don’t like about it is that they didn’t invent it.”

Betfair is science, as inevitable as GroupOn or stem cell replacement. If the world is able to produce something new, it produces it. When people want something, you make a mistake by not letting them have it Betfair claims three million customers. If all goes as planned, those in New Jersey will be able to bet Monmouth on Betfair this summer.

“This is a chance for racing to get on the front foot instead of the back foot,” Burn believes, not perplexed by the criticisms faced. Zuccoli, stressed to the max by what’s already gone on, said, “The exchanges are the most incredible invention in the last 50 years, technology-wise – no question about that. But they are the instrument of the devil.”

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