Who is Winning in Ohio – The Racinos or The Casinos?


There is a storyline developing in Ohio about competition between casinos and racinos. In the current narrative, the racinos are winning the race to the bank. The rules and the scoring procedures are not clear to anyone except the reporters. The article below is typical; in July, Hollywood had $12.9 million in slot revenue and Scioto Downs had $12.7 million. The numbers changed between March and July, but the interpretation and terminology has not changed.

The battle is playing out in Columbus, where Scioto Downs Racino saw a 3 percent boost in revenue to $12.8 million in March, while revenue at Hollywood Casino Columbus dropped 12 percent to $18.3 million from a year earlier. Scioto Downs bested Hollywood Casino during the month for its haul from video slots, with $12.8 million to the casino’s $12.4 million. Columbus Business First, 4-7-15

The day after the July figures for Ohio were released I got a call from a radio reporter. She started with the premise that racinos are more successful and winning the game. She wanted my opinion; “Why, she asked, “Are the racinos more popular and profitable than casinos?” A really good question, if it were true that racinos are more popular and profitable. In the first place, gross gaming revenue is not profit and I failed to see how she arrived at the conclusion that racinos are more popular. She was not comparing apples to apples; there are seven racinos and only four casinos in Ohio. The total revenue from the seven was indeed more than from the four.

July gaming revenue for Ohio was up over 30 percent; the casinos were up only 2 percent, but the racinos were up 37 percent. The increase was due in large part to the addition of two racinos. On a same store basis, the racinos were up 7 percent. Individually, the casinos averaged $17.3 million in gross gaming revenue and the racinos averaged $10.4 million for July. There are 7927 slot machines in the casinos and each averages $196 win-per-day; there are 10,473 slot machines in the racinos, averaging $225 win-per-day.

Revenue at Hollywood Casino Columbus totaled $18.2 million in July, up 3.4 percent from July 2014…The four casinos in Ohio posted combined revenue of $69.5 million in July, up 2 percent. Revenue at the state’s seven racinos totaled $73.1 million in July, up 37 percent from July 2014, when only five were open. Mark Williams, Columbus Dispatch, 8-8-15

In total, the casinos averaged considerably more revenue than the racinos for July. However, it is true that slot machines at the race track are averaging $30 a day more win per day than those in casinos. So are the slots at the track more popular? I think not, the difference is in population, not popularity. The two properties with the most revenue were the Hollywood Casino in Columbus and the Hard Rock Rocksino in Northfield. Hollywood had $18.1 million in revenues and the 2234 slots averaged $187 a day. The Hard Rock had $18.7 million in revenues and its 2280 slots averaged $265 a day. Both are in the most populous regions of the state. Hollywood is situated in the Columbus Combined Statistical Area (CSA) which contains 2.5 million people. Hard Rock is located in the Akron (CSA) with 3.5 million people. Third on the list was the Horseshoe in Cleveland with $17.8 million. It might be expected to top Hard Rock as they are both in the same CSA. But located in downtown Cleveland, Horseshoe does not have the ease of access or parking that Hard Rock has.

The racinos are not more popular or more successful than the casinos. The casinos and racinos with the best locations and the least competition have the most revenue. There is competition between the racinos and the casinos for every customer. They compete against each other and against gaming properties in Indiana, Illinois, Pennsylvania, Michigan and West Virginia. Those with the largest population base and fewest competitors are the winners, regardless of whether racino or casino.

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