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Author Topic: Hawthorne: rumors abound  (Read 5337 times)
CLOCKERTERRY
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« on: January 02, 2006, 12:17:32 AM »

Lots of rumors at the old mill today, mostly regarding steps Hawthorne is talking about taking to cut and/or avoid costs. Maybe even a partial reconfiguration of the plant to use less of it, and a few participatory expenses dropped. None of it sounded real positive, either as an indicator of current business and current Illinois racing health, or as things customers will like. We'll leave it at that, and will see. Rumors are rumors.

Meanwhile, the Spring handicapping contest series sounds like it is going to rock! Starts Jan. 14. See Hawthorne website.
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Stat Man Steve
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« Reply #1 on: January 02, 2006, 09:14:06 PM »

Spring Contest should be wonderful.

Potentially moving the Handicapping & Business Center from the 3rd Floor is a potentially grim situation for those of us who use it regularly.  I'd really hate to see it moved to the First Floor, esp. Grandstand Side - lots more people might be walking through the room, lots of strangers.  Those of use who bring our Laptop Computers are concerned about the serious increased risks of theft, depending on if and where it might be moved to.  I do my work for both of my jobs on my Laptop, sometimes doing work tasks from the Center with the internest access.  Losing my Laptop by theft or damage would be an absolute disaster for me.   I remember when we had to move at Sportsman's in 2000 to the second floor when there was no Handicapping Center, we had people getting their coats stolen, I had to deal with a Con-Man (the one I chased out of the Center 3 years later at Hawthore on Derby Day).   

Other potential concerns as well.   To me, having Scott at Hawthorne, and a decent, non-transient-filled/relatively well monitored Handicapping Center with Internet Access are two of the big reasons I'm drawn to Hawthorne.  The great Hawthorne Rewards program and the Handicapping Contests are the other two.  I'd really hate to see one, and certainly not 2 or more those things change, in an manner that I and a number of my 3rd-Floor/Handicapping Center friends would be disappointed, if not turned off by.   

So, hopefully rumors, options and/or possible tentative plans are no more than that.
« Last Edit: January 02, 2006, 09:16:17 PM by Stat Man Steve » Report to moderator   Logged
beatledave
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« Reply #2 on: January 02, 2006, 09:57:08 PM »

It's not the first time they've tried to move Scott from the 3rd Floor to save expenses.  He's always been able to win out and I hope that he does again.  As a kid (long before I ever worked at Hawthorne), my father and I used to sit on the (old, enclosed) 3rd floor to watch the races.

One of the reasons we stopped making the daily drive was when they closed the 3rd floor during the week in (I want to say) '87 or '88.

Scott was instrumental in revitalizing the 3rd floor - the contests have helped as did the healthy dose of new monitors when Sportsman's moved over in 2003.

here's hoping they leave the 3rd floor as is (close the second floor granstand if you must close anything)
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laurajean
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« Reply #3 on: January 02, 2006, 10:45:45 PM »

One of the major reasons I can feel comfortable going to Hawthorne is the Handicapping Center. As a woman going to the track alone I would not feel safe on the 1st floor grandstand side by myself. I like being able to spread my handicapping on the table. I also like knowing that my handicapping stuff is safe while I go place a bet or get something to eat. 

The Handicapping Center tells me that Hawthorne is serious about providing service to the serious handicapper.  It would be interesting to see how many winners of the Pick 5 contest and the Sunday handicapping contests are regulars of the center. I counted over 10 and I bet if I looked at the programs I would find at least a dozen more.

While I am not planning to go to Hawthorne until live racing starts I am thinking seriously about the contests coming up in January. 
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g3tPWNed_24
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« Reply #4 on: January 05, 2006, 02:32:09 AM »

terry you mentioned the"health" of illinois racing, how would you describe the current health of our game here in this state?
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CLOCKERTERRY
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« Reply #5 on: January 05, 2006, 10:18:04 PM »

terry you mentioned the"health" of illinois racing, how would you describe the current health of our game here in this state?

I would say the patient is still alive, more alive than in many racing states, but slowly bleeding to death out the back door. It's the same as everywhere. The racetracks and horsemen sell their signal to rebate operations and handle stays the same or grows slowly as the same people bet on the same tracks, but instead of 20% handle at the track or OTB, it's 3% handle from the rebate house. They've sold their business to the distributors.
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David
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« Reply #6 on: January 05, 2006, 11:14:16 PM »

In keeping with the manufacturing analogy, if you are a mfgr. and make a great product, it isn't going to do you any good unless you 1.) contract with distributors (the often maligned "middleman") to market, deliver and provide sales of your product (vast majority of manufacturers) or 2.) hire your own sales force and develop distribution of your product and by-pass the middleman (Dell Computers etc.).

Either way thier is a cost to get your product to market, and perhaps a hidden cost if you choose Option 2 and aren't able to execute the sales and distrubution yourself and your good product goes unsold or you limit your potential market by region of type of customer.

Is horseracing different? probably not - what if starting tommorow Hawthorne wasn't available on any on shore or off shore, rebate or no-rebate, legit pool comingling or non legit books (those that don't comingle)? Would people who were betting there all come back to Stickney to wager? How much of that handle would find a new path into the pools locally? Probably next to nothing if my guess is right. Is the 3 percent of a large number bigger than the 20 percent of next to nothing number?
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jrstark
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« Reply #7 on: January 05, 2006, 11:56:48 PM »

The problem is there are legal distributors who pay more who are not allowed in the market.  Let them in, and the tracks get a higher percentage and more promotion.

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CLOCKERTERRY
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« Reply #8 on: January 06, 2006, 12:16:05 AM »

In keeping with the manufacturing analogy, if you are a mfgr. and make a great product, it isn't going to do you any good unless you 1.) contract with distributors (the often maligned "middleman") to market, deliver and provide sales of your product (vast majority of manufacturers) or 2.) hire your own sales force and develop distribution of your product and by-pass the middleman (Dell Computers etc.).

Either way thier is a cost to get your product to market, and perhaps a hidden cost if you choose Option 2 and aren't able to execute the sales and distrubution yourself and your good product goes unsold or you limit your potential market by region of type of customer.

Is horseracing different? probably not - what if starting tommorow Hawthorne wasn't available on any on shore or off shore, rebate or no-rebate, legit pool comingling or non legit books (those that don't comingle)? Would people who were betting there all come back to Stickney to wager? How much of that handle would find a new path into the pools locally? Probably next to nothing if my guess is right. Is the 3 percent of a large number bigger than the 20 percent of next to nothing number?

The problem with the manufacturer analogy is that no manufacturer sets the price for a product and then sells it to distributors for 15% of the MSRP. Moreover, no manufacturer that has a company store gets into a situation where one of the distributors can sell his product to the exact same customers for 1/2 the price at the company store. Finally, no manufacturer gets into a situation where the distributors won't allow the manufacturer to lower his price to be competitive. But all three are exactly what has happened in racing.

To get control of things again, every track would have to pull their signals from the big rebaters, onshore and off, all at once. The real plum is not the video signal but access to the pools. Not too many non-pool bookies are going to pay track prices on big things like pick-6's and superfectas if they are the ones with the risk.

People aren't going to come back to Hawthorne to bet. They aren't going to go back to the OTB's and the dumb surcharges. Total betting would probably go down if rebates were cut out. But there's a role for the TVG's and Wintickets and YouBets, for people who like the convenience of betting from home. Tracks should be getting a much higher percent from these outfits, and they do. I heard Magna was charging something like a 10% fee for tracks like Gulfstream and Santa Anita. Any outlet that isn't another racetrack with its own live racing program should be charged substantially more, and that includes Las Vegas casinos.

There should also be some way for the track itself to be the one paying the rebates no matter where you play from. Just like when you buy a car, the rebate comes from Chevy, not the dealer down the street. Distributors are just that. But in horse racing they have become the show. The tracks and horsemen are just cheap commodities, a small cost of the final product.

Problem is, it won't happen in the current environment. It would be collusion and price fixing. Tracks would have to turn into a real league like the NFL and sign over their signal rights so the League could do the negotiation of an entire package. Besides, every track still sees other tracks as the enemy, not other forms of gambling or distribution.  
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David
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« Reply #9 on: January 06, 2006, 09:03:16 AM »

I'm not going to argue that the pricing structure is not the smartest thing the industry has ever done, but what I will suggest is that the entire problem is due to the large takeout that the tracks have, the takeout has risen over the years - both directly and indirectly through more people betting the higher cost exotic wagers. While it might be said that the pricing of the signal is out of whack - I would suggest the pricing to the gambler is out of whack as well and that the end result is someone willing to sell at a more reasonable level.

I think what is not taken into account is the value that the rebaters add to the equation (that value is new found gamblers), you have some guy in say Utah firing in on Hawthorne races because he feels he will get a good gamble on his dollar becuase he is betting into a lower cost structure - if that value goes away - so does he - he isn't going to say I really have grown to like Ill Bred 10,000 maidens, I'll need to pay full price to bet on them.

I think it is quite common for distrubutors to undercut the pricing of the factory on items, in fact it would never be the other way - as the distrubutors would find another product to sell if that was the case. One example that comes to mind would be Palm products  - Palm sells direct at full retail, and through Circuit City or others which discount the product.

Another analogy of my perhaps flawed thinking on the subect, If you are an artist and make a cool painting, so cool in fact that just about everyone in Chicago is willing to come and pay $ 1 just to see it, you are making money which is great. But if you could make a copy of the picture and send it around the country and others could promote and show it and you would get .20 cents of each dollar, aren't you going to make more money? Certainly you would if their are at least 4 new customers for every 1 that would have traveled to Chicago to see it.

Hasn't the race purses out paced inflation in the last 20 years anyways?
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laurajean
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« Reply #10 on: January 06, 2006, 06:11:37 PM »

If the Handicapping Center is moving, where to and why? I still don't see how moving everything around and building a new center would be a cost efficient move.  If they don't want the center on the 3rd floor, what do they want to use that space for. I had heard rumors of leasing out space for trade shows.  Is this what Hawthorne has in mind for the 3rd. floor?

 When Hawthorne visualizes their marketing plan for the center, who do they think is their customer base for the center. 

If I were the marketing manager of Hawthorne I would do several things before moving the center.

1. See if trade shows at Hawthorne could be a viable option for extra space. Why go through the expense of remodeling without knowing there is a firm commitment to using that space.
2. Find out what the people using the Handicapping Center think about the move. Will businessmen be interested in going down to the 1st floor to use the equipment at the center. 
3.What are the plans for the 2nd floor Grandstand side? Will that also be closed and what will it be used for?
4. The only logical placement for the Handicapping Center on the 1st floor would be over near the horseman's area.  But I can see there might be a problem finding enough space since that is also where the customer service center and historical exhibits are.  Might be an interesting battle to see who keeps their share of space.
5. If they do close down the 3rd floor, where will they hold the contests. I have been in the contests since the diva one and they have gotten more and more popular.  It was very crowded  for the "Hair of the Dog" contest. I could see them getting more and more popular.

I am not really familiar with Hawthorne management. But I have worked several places where it seemed that with a little more pre-planning things might have been more successful.  Since I am not privy to what management is saying I am just guessing and coming up with some questions I sure wish I could have answered.  It think it is a lot easier to do the research and then come up with a plan then doing something and realizing the consequences were not what you wanted.
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dukek
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« Reply #11 on: January 06, 2006, 06:50:19 PM »

laurajean, you used some things together that don't seem to apply at Hawthorne, you said Marketing Manager and plan in the same sentence.  Since Hawthorne brought in the new guy, all that's happened is people have gone elsewhere.  The Handicapping Center and contests were a good place to go and this year we had to hear this guy talking all day long on those bad Sunday contests when it was a ghost town up there anyway.  Replace that guy, let McMannis do his job and bring someone in that has a clue as to how to bring people to the track, then maybe things would be better for racing in the state.

The Handicapping Center was moved to its current spot and built very nicely, there's no reason to move it, but it seems like everything has changed since the new guy came along.  At least we got to see the same 5 people win the stupid Pick 5 challenge every week.  Want rumors abound, how about getting rid of him and the rumors will go away.
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big wally
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« Reply #12 on: January 07, 2006, 11:50:45 AM »

With a 10% decline in on-track handle and all the give aways Hawthorne has with their rebate program and Handicapping contest(s) their bottom line really had to suck. They gave away money and no new blood came on board. Sounds like a marketing disaster to me.
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edwarren
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« Reply #13 on: January 07, 2006, 05:06:04 PM »

I would say the patient is still alive, more alive than in many racing states, but slowly bleeding to death out the back door. It's the same as everywhere. The racetracks and horsemen sell their signal to rebate operations and handle stays the same or grows slowly as the same people bet on the same tracks, but instead of 20% handle at the track or OTB, it's 3% handle from the rebate house. They've sold their business to the distributors.

I think Oak lawn and Tampax Bay are stringier with their signal. They do all right, don't they? Winter racing in Chicago? That's a tough row to hoe.
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John Frank
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« Reply #14 on: January 08, 2006, 01:05:44 AM »

Let me Add. I have never seen a more stupid post. This is why BTW has no comments.
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edwarren
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« Reply #15 on: January 08, 2006, 09:08:43 AM »

Let me Add. I have never seen a more stupid post. This is why BTW has no comments.

n/t
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edwarren
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« Reply #16 on: January 08, 2006, 09:20:52 AM »

Let me Add. I have never seen a more stupid post. This is why BTW has no comments.

Other than the bad spelling, what's the matter with it? I'm sure Tampa and Oak Lawn do better business than HAW and they are STINGIER about selling their signal. HAW has to sell it's signal because there is no on-track handle.
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Horse Voice
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« Reply #17 on: January 08, 2006, 11:16:51 AM »

Let me Add. I have never seen a more stupid post. This is why BTW has no comments.

I just looked up the word "irony" in the dictionary, and it reads:

Main Entry: iro·ny 
Pronunciation: 'I-r&-nE also 'I(-&)r-nE
Function: noun

The use of words to express something other than and especially the opposite of the literal meaning. Example: see John Frank post on BTW calling another member's post stupid.

Have another beer, jackass.
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off stride
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« Reply #18 on: January 08, 2006, 12:23:52 PM »

I just looked up the word "irony" in the dictionary, and it reads:

Main Entry: iro·ny 
Pronunciation: 'I-r&-nE also 'I(-&)r-nE
Function: noUN
Have another beer, jackass.
WHAT..ONLY 1???
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CLOCKERTERRY
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« Reply #19 on: January 11, 2006, 01:52:02 AM »

laurajean, you used some things together that don't seem to apply at Hawthorne, you said Marketing Manager and plan in the same sentence.  Since Hawthorne brought in the new guy, all that's happened is people have gone elsewhere.  The Handicapping Center and contests were a good place to go and this year we had to hear this guy talking all day long on those bad Sunday contests when it was a ghost town up there anyway.  Replace that guy, let McMannis do his job and bring someone in that has a clue as to how to bring people to the track, then maybe things would be better for racing in the state.

The Handicapping Center was moved to its current spot and built very nicely, there's no reason to move it, but it seems like everything has changed since the new guy came along.  At least we got to see the same 5 people win the stupid Pick 5 challenge every week.  Want rumors abound, how about getting rid of him and the rumors will go away.

There weren't that many Pick 5 challenges to begin and I don't remember it being the same 5 all the time. Think you are off base there dukek.

I kind of liked the old contests because it meant every month the 3rd floor would be packed for the contest, and I did better in them than I've been doing in these betting ones. But let's face it, mostly everyone was in those things for the hot dog, and it wasn't what you would call a real sophisticated contest format. Just pick the most winners.

The new contests don't get as many people because of the $20 buy in price, but I like them, and it seems like many of the "regulars" are up there every week. They've also attracted a few people who were regulars at other wagering venues. What you don't have anymore is all the 1st floor regulars who don't want to shell out $20. But for them there is, (or was? I see we have two buy in contests a weekend this Spring), the free Saturday Pick 5 contest.

One thing that didn't happen this year that brought in lots of people in the past was the free bad Italian buffets.
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CLOCKERTERRY
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« Reply #20 on: January 11, 2006, 01:58:43 AM »

Other than the bad spelling, what's the matter with it? I'm sure Tampa and Oak Lawn do better business than HAW and they are STINGIER about selling their signal. HAW has to sell it's signal because there is no on-track handle.

Oaklawn does better because it gets huge crowds, but Tampa Bay is more myth than reality as far as being bigger time than Hawthorne. Their on track isn't great, and most of their handle is from out of state simulcasrt.The figures are at the bottom of Equibase charts. Sunday they did $257k on track, $283k intertrack in Florida, and $1.9M simulcast. Those are about the same as Hawthorne numbers for a Sunday. 
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CLOCKERTERRY
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« Reply #21 on: January 11, 2006, 02:02:16 AM »

With a 10% decline in on-track handle and all the give aways Hawthorne has with their rebate program and Handicapping contest(s) their bottom line really had to suck. They gave away money and no new blood came on board. Sounds like a marketing disaster to me.

It really depends on how their on track simulcast numbers are. They didn't report those. The other question you ask is how much worse it would be if they did not have all that stuff.

Overall I agree, it seems like a lot of effort to get people there, and not much response from the public.
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laurajean
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« Reply #22 on: January 11, 2006, 10:32:25 AM »

It really depends on how their on track simulcast numbers are. They didn't report those. The other question you ask is how much worse it would be if they did not have all that stuff.

Overall I agree, it seems like a lot of effort to get people there, and not much response from the public.

The problem with the contests is it is not bringing new people to the track.  The last contest had over 100 people but it still consisted of people who regularly go to the track.  Perhaps scarce marketing dollars should go to attract more new people to the track as opposed to spending it on people who would be at the track with or without the contest.

I shouldn't complain about the contests. I have made money off of them. But if the contest disappeared I would still go to the track.  If the Business and Handicapping Center was gone I would not go to Hawthorne. 

There are contests everywhere, even on-line.  But there is only one Business and Handicapping Center. If it was gone I have a lot of options. I could go to Trackside and hang out with John Frank. There is a OTB in South Elgin I could go to with is close to me and useful for making a bet and then doing the rest of my errands.  I could bet at home. 

I go to Hawthorne because I have learned how to be a better handicapper by going to the center.  My niece is getting old enough now to introduce to horse racing. I can take her and my sister-in-law to the track and use the center as a focal point. We could, like a lot of other people listen to the remarks before the races. Then we can visit the paddock, eat in the Gold Cup room and watch the races outside.  But it is sure nice having the center available to ask a question or sit down and watch a replay of the races.

I can go anyplace to play a contest or make a bet. I can only go to Hawthorne if I want to use the Handicapping Center.
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CLOCKERTERRY
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« Reply #23 on: January 11, 2006, 10:47:27 AM »

The problem with the contests is it is not bringing new people to the track.  The last contest had over 100 people but it still consisted of people who regularly go to the track.  Perhaps scarce marketing dollars should go to attract more new people to the track as opposed to spending it on people who would be at the track with or without the contest.

I don't agree with that. For instance my friends Dick and Tommy. Dick used to come every once in awhile, and Tommy maybe twice a season. He was a regular at Maywood. Now they are there every contest. They put a lot of real money through the windows, too. There's the couple who sits back by the windows close to us for every contest. They drive in from out by Peoria. They were never up on the 3rd floor ever day. Sometimes I see names on the contest board of people I recognize who I know are not regullars. So the contests do bring in some people who wouldn't be there otherwise. I'm sure Hawthorne keeps track of who's in the contest and who's using their Club Haw cards on the 3rd floor those days, too, as a metric.
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Horse Voice
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« Reply #24 on: January 11, 2006, 11:08:10 AM »

The idea that marketing dollars should be employed to attract "new" customers is to ignore the reality that horse racing just isn't very popular with the general public. IMO, it's a huge waste of time.

Most "new" players are brought in under the wing of an existing player. Think about how you got started: your Dad, Grampa, an uncle, a friend...somebody else took you to the track, and showed you the basics. The person who sees "Go Baby Go" on TV and decides to just up and wander into the track, and start plunging, is a rare bird.

Hawthorne is doing everything they can to hold on to the on-track customers they already have, while appealing to the simulcast players who clearly favor cards with full fields. They finished the recent meet down about $20K per day in on-track handle (that could be 1 or 2 guys lost to rebaters, BTW), but way, way up in simulcast handle; by today's standards in meet-to-meet comparison of racetrack handle, that's a huge success.
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