On Track - May

9 May 2002

Derby a Big Winner for Many

Many gaming companies, particularly those with an interactive presence, saw huge gains from the United States' biggest day of racing, the Kentucky Derby.

Companies with good news about the race included:

  • TVG

    The TV Games Network is enjoying record growth due to the opening of Hollywood Park, the Kentucky Derby and increasing popularity in Quarter Horse racing at Los Alamitos. From April 25 to May 4, the 24-hour horse racing channel and interactive wagering company registered more than 7,500 new subscribers and processed more than $8 million in total wagering handle--254 percent increase compared with the corresponding time period in 2001.

    TVG's total wagering handle on Kentucky Derby day this year was nearly $2.8 million, a 200 percent increase over 2001 Kentucky Derby Day wagering handle.

    TVG began processing wagers from California residents earlier this year and increased distribution of its television network in Southern California with carriage on Adelphia digital cable systems.

    It also recently announced a relationship with Fox Sports Net West and Fox Sports Net West 2. The agreement includes two hours per day of live racing coverage by TVG.

  • Youbet.com

    The week of the Derby was record-breaking for Youbet.com. The day of the Kentucky Derby, handle was more than $1 million, and a record 2,000 people registered in the 48 hours preceding the race. Y

    oubet.com's prior single-day record was set May 19, 2001, the day of the Preakness Stakes race. The largest handle recorded in a week was originally set during the 2001 Preakness week, but was broken April 20-27, 2002.

  • Churchill Downs

    The Kentucky Derby established betting records for both the race and the overall Derby Day card at Churchill Downs. A total of $79,094,806 was wagered on the Kentucky Derby and overall betting on the entire 11-race card was $123,315,302.

    The total for the 2002 Derby Day program at Churchill Downs sets a North American record for single-day wagering. The previous high was $108,603,040, the amount wagered on the 2000 Breeders' Cup Championship, which was also held at Churchill Downs.

    Overall wagering on the Kentucky Derby grew 11 percent over the previous record of $71,189,142 set last year. The on-track total for the day--which included an additional race--rose 9.73 percent to a record $19,400,818.

    The previous Derby Day record, established in 2000, included wagering on 10 races compared to this year's 11 races. Overall betting on the entire 11-race card grew 14.5 percent over the previous best of $107,598,904 established in 2001.

    On-track wagering this year on the race was $8,630,408, a 3 percent increase from last year's total of $8,360,273. The record for on-track wagering, $8,737,659, was set in 2000.

    Pictures Deal Still on Hold in England

    An official agreement between bookmakers and horse racing officials in Britain remains on hold as members of both sides await word from their members.

    Late last week, officials with the Racecourse Association and British bookmakers group reached an "in principle" agreement on how bookmakers would pay for satellite pictures and race feeds in their betting shops.

    The agreement was quickly criticized by key members from both sides. It remains unclear whether the two sides will head back to the bargaining table or try to push the agreement through.

    attheraces Off to Good Start

    The British Internet site attheraces averaged about £38,000 in wagers per week from 21,000 subscribers in the service's first 15 weeks.

    "Income from betting is broadly in line with management expectations. We've started very low, but that was always going to be the case," Ian Penrose, Arena Leisure Managing Director, told the Racing Post.

    In conjunction with Channel 4 and BSkyB, Arena launched the attheraces digital cable channel on May 1. The channel will offer interactive betting later this month.

    Hong Kong Jockey Club Facing Woes

    The Hong Kong Jockey Club is heading for its lowest betting turnover in seven years though the situation could improve if legislators pass the Gaming Ordinance Amendment bill on May 22.

    After 66 meetings of the current season, total turnover stands at HK$66.6 billion. With 12 meetings remaining, conservative estimates place total turnover at about HK $79.7 billion--about 2.25 percent lower than last year's figure of HK$81.5 billion.

    Government revenue is also expected to fall by about 2.25 percent to HK$10.7 billion if the slide continues.

    The last time turnover reached similar levels was in 1996 when it totaled HK$80.6 billion after just 71 race meetings. However, turnover went hit an all-time high of HK$92.3 billion the following season, which was also the last year of colonial rule. Since then, turnover has been on a steady slide downward.

    Jockey Club officials have warned that contributions to the government and the community this year could be adversely affected if action were not taken to stem the outflow of gaming dollars into Internet and offshore betting syndicates.

    Magna to Launch TV Network

    This summer Magna Entertainment Corp. plans to a launch a 24-hour horse-racing network that promises to educate and entertain viewers.

    The channel will be called HorseRacing TV and should be available nationally through satellite and cable television, though details are still being negotiated, said Jim McAlpine, president and CEO of the Canadian racing conglomerate.

    Magna now broadcasts live racing through the Racetrack Television Network, which is a satellite-based system offering eight channels of races from one of Magna's 11 horse and dog tracks and from tracks owned by Greenwood Racing. Greenwood is a partner in the network along with Roberts Communication.

    The Racetrack Television Network is an expensive service. The hardware and installation cost $450 and the service is $100 per month. McAlpine said it was too early to talk about the price of HorseRacing TV.

    TVG Reaches Deal with AmericaTab

    Television Games Network has entered a patent license and content agreement with AmericaTab Ltd., which enables that service to use TVG's technology to offer interactive wagering.

    The move opens betting on TVG partners at winticket.com, brisnet.com and tsnbet.com, all licensed by AmericaTab. The deal will also covers Northfield Park's Bet Harness.com and BetRunners.com, AmericaTab's only harness licensees.

    New Jersey Close to Account Wagering

    Off-track betting and phone wagering are close to being a reality in New Jersey after a deal was reached between groups representing harness and thoroughbred horse racing interests.

    Bets could be placed via telephone by the fall, while the first betting parlors could be open in late 2003, said Bruce H. Garland, senior vice president of the New Jersey Sports and Exposition Authority.

    The horsemen's agreement provides for 141 days of thoroughbred racing each year through 2004--21 more days than last year--split between the Meadowlands and Monmouth Park race tracks, said Dennis A. Drazin, a lawyer for the New Jersey Thoroughbred Horsemen's Association.

    The deal also provides $3.3 million from the authority for better purses for the thoroughbreds, which are overshadowed by trotters in New Jersey. The Meadowlands is the home of the Hambletonian and the Meadowlands Pace, both among the most important harness racing events of the year. Both have million-dollar purses.

    The agreement settles a lawsuit by the thoroughbred horsemen, which could have blocked simulcasting, one of the biggest moneymakers for the horsemen and the two state-owned tracks.