Perhaps the most curious participant in Tuesday morning’s “View From the Top” keynote session at the 2023 Global Gaming Expo (G2E) was Bill Carstanjen, CEO of Churchill Downs Inc.

As the company’s name suggests, CDI counts among its assets both America’s best-known horse track (Churchill Downs) and race (the Kentucky Derby). But while its TwinSpires wing boasts one of the nation’s top advance deposit wagering platforms, CDI’s entry into the mobile sportsbook space tanked, and the company’s frustrating decision not to obtain a sports betting license for Arlington Park in Illinois precipitated the demolition of a beautiful racetrack.

“At first we thought everything we knew about horse racing online would translate to other sports,” Carstanjen said when asked by CNBC’s Contessa Brewer about the failure of TwinSpires’ sportsbook. “But they really haven’t.”

Carstanjen added that CDI was aware the sportsbook industry could wind up favoring a handful of well-financed behemoths that could absorb short-term losses, but “that just wasn’t the way our company was gonna go. The long haul you needed to sign up for just didn’t feel right to us.”

‘A great game if you’re the house’

Before Carstanjen appeared onstage, Brewer recalled how she thought Vegas’ upcoming F1 race and the recent Sphere opening would be the happy backdrops for her questioning. Instead, she noted that the recent cyberattacks on MGM and Caesars and Hamas’ military assault on Israel had sobered things up considerably.

“The world is in turmoil now,” she said, raising the prospect of a potential recession and the ongoing “cost of living crisis.”

While he conceded that the cybersecurity threat “has never been greater than now,” Carstanjen largely struck an optimistic note.

“It’s still a strong economy. I’ve seen times that were much more concerning than now. We just have to keep our eyes on things,” he said. “Things are not quite what they were a year or so ago. There seems to have been some settling down, but things are pretty darn solid, pretty darn good.”

They could be better, in his opinion, if skill-based — aka “gray” — games were outlawed. Pointing to CDI’s operations in Kentucky, Pennsylvania, and West Virginia, he said, “Some states, it’s just grab the foothold, and I would say the gray-game operators have used the legal and legislative system fairly effectively. They try to create ambiguity, they try to create noise — make it confusing, make it ambiguous, try to get a foothold, and argue that you’re going to get hurt if you pull the machines away.”

At the end of the day, though, he’ll always have parimutuel horse betting.

“People are betting against themselves, and as the house, you take a rake,” he explained. “It’s a great game if you’re the house.”

Photo: Mike Seely