The Horse Wizard was a hybrid of a slot machine and a live race telecast, in which images of horses instead of cherries spun on the screen. Win, and listen to the sound effects of coins dropping.
It was Frank Stronach's pet project. To the founder of Magna Entertainment Corp., the Horse Wizard took the thinking out of betting, while offering the excitement and instant gratification of casino gambling to a new generation of patrons.
But if Stronach expected others around him to embrace his enthusiasm, he didn't hear it. "I remember sitting there, and he had some test ones, and I tried them and said, `This is really bad, Frank,'" recalled Gino Roncelli, a former Magna director."`
Oh no, they're going to get used to this. This is going to be great,'" Roncelli remembered Stronach saying. "I said, `Frank, this is a terrible loser.'"
Undeterred, Stronach authorized spending $15 million to $20 million to build and install Horse Wizards at Magna's major thoroughbred tracks. At Laurel Park, officials built a new room with flat-screen TVs, faux-velvet ropes and nightclub lighting to hold 36 of the slot-machine lookalikes.
But the device had little of the appeal of either slots or live wagering. The result: Virtually no one played. Less than a year after the VIP debut party in January 2005, Laurel shut the Horse Wizard lounge. The machines still sit in the roped-off room.
The Horse Wizard was, in microcosm, the story of Magna Entertainment under Stronach. Fueled by the auto-parts magnate's passion for horse racing, Magna's eight-year run as a public company has been marked by autocracy and misplaced risks that have disappointed even some of Stronach's allies in the fight to save horse racing, according to more than a dozen interviews with people in the industry and a review of thousands of pages of federal and state financial filings.
And his management acumen could have an even greater impact on the future of Maryland's racing industry, if voters pass a slots referendum in November.
Magna has lost more than $400 million since 2002 and survives on infusions from Stronach personally and his other businesses, filings with the Securities and Exchange Commission show.
It has had five CEOs in eight years - not including Stronach's three stints as interim CEO - and equally rapid turnover in track management. Most of Magna's tracks lose money - one exception being Baltimore's Pimlico Race Course, though its profit is entirely from the Preakness Stakes, the middle leg of racing's Triple Crown.
