Close to 150,000 people will jam into Churchill Downs for the Kentucky Derby, making it one of the best-attended sporting events in America. But the rest of the year, racetracks are emptier than ever, not because the sport is getting less popular, but because the track is a terrible place to bet on a horse.

The whales, the big bettors who support the industry, don’t show up at the track because they can get a better deal elsewhere — by calling in their wagers to phone-betting hubs in exotic, loosely regulated locales like St. Kitts or North Dakota. Say you want to lay $1,000 on a horse running at Aqueduct. You call the hub in Fargo, then an operator takes your bet and relays it to New York, where the money is fed into the racetrack’s pool. Why not just bet directly at the track? Because you get a better return on your investment by staying away.

The phone hubs take advantage of the economics of simulcasting. Racetracks “sell” their signals to one another in exchange for 3 percent of the handle. If a horseplayer sitting at Santa Anita bets $100 on a race at Belmont, Belmont gets $3. The hubs pay a little more for this privilege than the tracks, between 7 percent and 9 percent, but since they don’t have to maintain a grandstand or feed horses, they can kick money back to their customer

The bigger the bettor, the bigger the rebate. The average racetrack’s house take is 20 percent. You’re subject to that bite whether you bet at the track or over the phone. The difference is that the highest-rolling players, who have the clout to negotiate rates, are refunded 10 percent of their wagers by the phone hubs. That cuts their disadvantage in half. Suppose you’ve been betting $5 million a year at the track and only breaking even. If you bet that same amount of money through a hub, you’ll get a $500,000 rebate. Suddenly, instead of spinning your wheels, you’re a professional horseplayer earning a fabulous six-figure income.

Since rebates were first offered at Las Vegas sports books in the mid-1990s, they’ve changed gamblers’ habits immensely. Maury Wolff, a professional horseplayer in Virginia, quintupled his action once he started getting rebates. He also stopped going to the track almost entirely — you’ll see him there 10 days a year. “I’m exclusively out-of-the-house now,” says Wolff, who was a 200-day-a-year racetrack regular a decade ago. “It’s way more efficient.”

At the track, Wolff has to wait in line for tickets and copy exact prices off a TV monitor. At home, he can watch the odds on his computer and get a bet down with a mouse click. Plus, he has piles of handicapping records on his desk — take those to the track, and you’ll look like Groucho juggling tip books in A Day at the Races.

For some guys, rebates mean the difference between feeding bales of cash to the horses and staying at home and watching baseball on Thursday afternoons. Dana Parham, who may be the biggest whale of all, bragged to a University of Arizona symposium that, thanks to rebates: “I am directly responsible for over $2.4 billion in handle since January of 2000. One hundred percent of this is new money that would otherwise not be in the pools at any level.”

What’s happened here is a market correction in racetrack takeout. For years, gamblers have complained, and rightly so, that a 20 percent bite made winning nearly impossible. But there was no way to change it. The track and the OTB were the only places to bet, and their rates were set by state racing boards, controlled by politicians who sin-taxed gamblers as hard as drinkers and smokers. Now, phone hubs, whales, and the racing industry have worked out a new arrangement. It leaves out the $2 patzer, who doesn’t bet enough to qualify for rebates, but so what, goes the attitude. The biggest customers get the best deals.