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Horse Race Betting Then and Now

Thoroughbred and jockey on the track showing tote board. Text and Photo copyrighted - photo Tamara Bauer.

Horse rack betting prior to the mid 1800's took place between owners. The public had only two options for wagering: the bookmaker to the pool. Bookmakers had no legal status, and often when they had too many winning bets, would be unable to pay. The pooling of wagers, gave a percent of the winnings going to the organizer of the pool, who often disappeared without paying. The public had no legal redress.


by Joseph Oller, participated in a pool for the 1864 French Grand Prix, won, and yet was never paid. Oller then developed a plan and presented it to the authorities, which they approved but had no authority to sanction. Oller began operating his lottery and pool, establishing a common fund for pool bettors, with absolute guarantees for the drawing of horses names and payment to the winners. Later, after establishing a reputation for honesty, he developed another horse race betting system which he named pari-mutuel, or mutual betting. The pari derives from the French verb to bet parier. This new system allowed those betting among themselves, to divide their winnings in proportion to their individual wages, providing the ability for bets to be as varied as possible.

People quite liked the new system and its honest dealings. For the first time, those who could afford to bet but didn t have time or the money beyond the bet, to cover the expense of attending the races, this new style of horse race betting was terrific. To make sure to include the bettors at the tracks, Oller sent tellers to the race courses, using carriages as mobile offices. The business continued to be successful and soon Oller was selling pari-mutual tickets for races in England and Belgium.

Oller's success was based on several factors: wagering was made easy for the public and operations were honest, plus a percent was eventually granted the governments. In 1887,the pari-mutuel horse race betting system was declared legal, excluding all other systems, which in effect made the adoption of pari-mutuel mandatory for all racing>
. Another good business move was the allocation of a percent off the top, to be be divided among the jockey clubs, to offset the expense of operation the pari-mutuel.

The pari-mutuel gradually extended to most countries where Thoroughbred racing was popular. The only real difficulty remaining was to service bets quickly and accurately. A fast, accurate tally system for horse race betting was still needed and fellow in New Zealand by the name of Ekberg, did just that, by devising a manual machine he named a totalisator to automatically record wagers. This system continually improved and an electronic version was devised by another man from New Zealand, named George Julius, later knighted for having done so. The system became common the world over, driving the bookmakers away, for the most part and horse race betting became ever more popular with the public.


For quite some time, horse racing was America's top sport, but as the racing public grew, it became recreation for the city dwellers too instead of only those who were owners, trainers, breeders, or who lived in the country rather than urban settings. From the last half of the 19th century on, bookmakers totally dominated the horse race betting scene. Pari-mutuel was first introduced in New York in 1877, yet had it not been for the efforts of Colonel Matt Winn in 1908, the bookmakers might have maintained their dominance.


In 1908 prior to the running of the Kentucky Derby at Colonel Winn's Churchill Downs, the local authorities sated that betting would not be tolerated, but Colonel Winn, hating to lose revenue from wagers examined all statutes and discovered there were no restrictions at all regarding pari-mutuel. This system was immediately adopted at Churchill Downs and was likewise instated the next year at Pimlico, by the Maryland Jockey Club.

Gradually because of so much irregularity in the operations of bookmakers, pari-mutuel horse race betting systems were adopted by associations throughout the country, with New York being the last state to make it mandatory.

In 1929 the English Race Course Betting Board began using an American manufactured totalisator, the same electric tote was finally first installed in American at Aqueduct in 1933.

In past days, the majority of race people were honest, yet the occurrence of the few dishonest were always enough to disturb the confidence of the public. The establishment of the pari-mutuel which eventually banished the cheating of the bookmakers, and the electric tote which guaranteed the efficiency and accuracy, revolutionized horse race betting.

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