By MARK MAYER
The sport of kings is becoming the port of slots.
"I remember the comedian Joe E. Brown once saying, ”˜I follow horses and my horses follow horses,’" MGM MIRAGE chairman and chief executive officer J. Terrence Lanni said during the Global Gaming Expo at the Las Vegas Convention Center.
Lanni moderated a panel of racing and entertainment experts who agreed that slots are essential to saving the horse racing industry.
"I’m now in the gaming business," said Peter Carlino, chairman of the board and CEO at Penn National. "I lost $2 million at Charles Town (West Virginia) Racetrack before adding slots. Now we have a $500 million product."
The horse racing industry continues to lose money across the country, according to Carlino who noted that "43 of the 50 states are facing deficits."
Steven Crist, chairman and publisher of the Daily Racing Form said that slots and racing, "make for a funny marriage, but a great one financially."
Crist said he hopes slots can draw fans into racing, but expressed serious doubts.
"I started as a lover of racing, a purist," Crist said. "Now I will be seeing Aqueduct in New York adding $250 million in revenue when slot machines are installed next year. I don’t get how people can sit in front of machines and pull handles. Slot players have little in common with race fans."
Handles, however, translate into handle and even Wall Street has caught the sniff emanating from the emptying stables.
"There is no doubt that cashflow is $20-$30 million additional with slots," said Michael Tew, gaming analyst at Bear Stearns & Co. "In 12-18 months, we could see Kentucky, Maryland, Pennsylvania, Ohio and Nebraska commit to slots at their tracks."
The horse racing industry is trying to use the money accumulated from slot play into bolstering purses, which in turn will attract better fields and, hopefully, more interest.
"Slots and races need to be integrated," said Mark Wilson, president and CEO at TVG network, which broadcasts 14 hours of racing daily in selected markets.
"New Mexico racing was totally revitalized by slots," Wilson said. "We are trying to show that racing still has marketing power. Ours are the only interactive broadcasts nationwide. We need fans for the sport and slots is helping bring people into the tracks, which in turn helps us."
Carlino would like to see the revenue come in, but believes there is too much racing on a yearly basis.
"Slots can go all the time at the tracks, but it would be better for us if we cut back racing dates," he said. "We could pour more money into quality races. That’s what our business really needs."