Wagering vs. Sports Betting Growth: A Comparison

In an analysis of the Thoroughbred Racing Economic Indicators report for Q3, it’s evident that the surge in sports wagering isn't benefiting pari-mutuel betting. In the U.S., pari-mutuel wagering totalled $2.915 billion—down 4.57% compared to the same period last year. This decline is notable, especially as it far exceeds the mere 1.49% drop in race days, which totalled 1,189.

During this time, sports betting flourished, recording a 6% increase to $25.625 billion from July to September, according to legalsportsreport.com. This growth stems from multiple favourable developments, including expanding access to regulated betting across states and ongoing market launches. Despite the encouragement from experts at the 2018 BloodHorse and Breeders' Cup symposium regarding the integration of racing with online betting platforms, significant changes have yet to materialise.

While platforms like FanDuel and DraftKings now offer pari-mutuel wagering alongside sports betting, the industry persists with a high-takeout structure that discourages new participants. Additionally, racing's reluctance to adopt a fixed-odds betting model limits its competitiveness.

Despite a brief uptick in interest during the pandemic, pari-mutuel handle has fallen steadily since then, currently down 2.89% year-to-date. While it’s difficult to draw a direct correlation between racing's downturn and the rise of sports betting, the industry’s inertia in exploring innovative strategies has resulted in stagnation. In this evolving landscape, one would expect an increase in race wagering, not a decline.