STACKING THE ODDS
Dressed in a top hat and a slick black suit, Ron Luniewski — president of Xpressbet, a horserace gambling company headquartered in North Strabane — cut a stark figure against the 2,500 or so mostly plainclothed spectators of the race unfolding below him.
“I looked like the Monopoly man,” he recalled, chuckling.
But sometimes it pays to be dapper — especially if you’re in the company of the Queen of England, who had invited Mr. Luniewski to her private box for the 2003 Royal Ascot to be a spectator. She has long been a staple of the event; her procession signals the start of each day’s races, and her personal horses participate.
Mr. Luniewski, assuming the viewing area would be intimate, donned his best digs. But when he arrived, he found more than 2,000 other people milling around, too. He was one of few dressed formally.
Hemay have been overdressed,but Mr. Luniewski walkedaway from the race that dayhaving rubbed elbows with representatives of Royal Ascot, England’smost-attended horse racingevent. They started discussi-onsabout a possible partnershipthat day.
Now, North Strabane-based Xpressbet claims to be the preferred U.S. betting site for this year’s Royal Ascot race, according to the company. As the preferred U.S. betting site, Xpressbet will be the service that most attendees — either at the event or stateside — who are betting in the U.S. betting pool will use. This is the first year the company has the designation.
The race event started Tuesday, will run through Saturday, and is expected to draw a crowd of 300,000.
Founded in 2002, the company has been in the international market for horse racing for a while now. It has relationships with 130 tracks in the United States and 25 international tracks, Mr. Luniewski said, among them locations in Turkey and Australia.
The company was founded by the Magna Entertainment Co., which is now the Stronach Group. Its purpose is twofold: it serves as a wagering portal for thoroughbred, harness, and quarter races, and streams live video of horse races from across the world.
“Quite frankly, our real core is our ability to send signals out. We have to send data, waging, and video pathways out,” Mr. Luniewski said.
“Somebody told me this about a year ago, but I believe we’re one of, if not the largest, streamer of video on the internet. We run 364 days a year. Seventeen to 22 hours a day we’re sharing live horse racing. At a peak Saturday, we’re showing 22 concurrent race tracks at the same time.”
He declined to comment on the private firm’s annual revenue, but said it manages up to $750 million annually through its betting service. It employs about 150 people in its North Strabane location, which handles customer service, live advance wagering, government relations, and holds the company’s executive offices.
Xpressbet’s main feature is “pari-mutuel betting,” which lets folks who are betting on a race contribute to a common wagering pool.
“For example, if I’m in Las Vegas, in a sports bar there, and I bet a hundred in race to New York, that hundred goes into the common wing wagering pool in New York,” Mr. Luniewski said. “And then everybody that’s participating in the pool splits the pool.”
Pari-mutuel betting is a staple of Xpressbet and its parent company, the Stronach Group, which owns a number of racetracks including the Portland Meadows, Gulfstream in Florida, and Pimlico Racetrack in Baltimore, where the Preakness is held. Xpressbet rents its North Strabane offices from Gaming and Leisure Properties Inc, which owns the Meadows Racetrack and Casino.
The company is working in a challenging industry.
In the past five years, wagering on horse races has declined, according to a report by the IBIS World, which does industry research across a number of fields. Annual revenue is down 2 percent since 2011, the report found, which it attributed partly to the growth of gambling enterprises like “racinos,” which are hybrids of casinos and racetracks.
Additionally, the report said lowemployment and low levels ofdisposable income per capita havedepressed the industry’s growth.It added that the horse racingindustry is expected to continueto decline through 2021.
While Xpressbet has expanded internationally, it looks at Pittsburgh as a hub to lead the mainthrust of its innovation.
It’s in a partnership with Carnegie Mellon University’s CyLabs, a technology research institute at CMU that helps public and private companies develop new technologies. Mr. Luniewski said the partnership, which was started a year ago, helps attract prospective employees to the region, and Xpressbet receives education on technology through the partnership.
CMUconfirmed the partnership,but did not have someone availableto comment further.
The partnership is necessary, Mr. Luniewski argues, to combat what might be a potentially lethal trend in the thoroughbred racing industry: its inability to snatch the attention of millennials, who either aren't financially equipped to enter the gamblingbased sport or do not have the leisure time that older generationshave for the sport.
Part of the solution, he said, lies in attracting a slice of the market interested in the intersection between data analysis andgambling.
“We’re certainly not one dimensional,” Mr. Luniewski said. “We believe that some of the fundamentals of the sport need to change ... the venues need to be updated, and how we market and promote the events at the venues need to change.”