Goodlatte - Racing's Role
Horse racing remains the focal point of debates over legislation to prohibit online gambling in the United States. Two separate prohibition bills--one sponsored by Rep. Bib Goodlatte, R-Va., the other sponsored by Rep. James Leach, R-Iowa--were passed Thursday by the U.S. House Judiciary committee. The key argument involving the Goodlatte bill is whether the legislation provides an exemption for racing. Goodlatte's opponents say that his bill clearly leaves the door open for interstate race betting and criticize him for allowing one type of gambling online while banning all other types. Goodlatte maintains, however, that determining the legality of online interstate race betting under the terms of his bill is in the hands of the Justice Department, which has already stated that the Internet race betting is illegal, despite the presumption that it is authorized by the Interstate Horseracing Act. The next step for both bills is debate in the full House of Representatives.
Youbet Eclipses Derby, Preakness Marks
California-based online bookmaker Youbet.com Inc. reports that its International Racing Group (IRG) and United Tote subsidiaries surpassed all previous records for betting volume on last month's Kentucky Derby as well as on last week's Preakness Stakes. Youbet is reporting that it processed almost $5.6 million in wagers on Kenducky Derby day, a 34 percent increase over 2005; United Tote processed a record $175.0 million in wagers for the Derby, and IRG handled $4.3 million in live operator-assisted wagers on race day.
For the Preakness, Youbet processed $4.2 million in wagers on race day, topping last year's race-day total by 18.5 percent. Of the total that Youbet customers wagered on race day, $2 million went to the race card at Pimlico Race Course, a 7.6 percent increase over 2005, even as Pimlico's handle from all sources on race day declined by 3.8 percent from the previous year. Youbet users wagered nearly $1 million on the Preakness itself. IRG, Youbet.com's telephone wagering company, handled $3.3 million in wagers, up 239 percent from 2005. IRG contributed $1.3 million to the Pimlico pari-mutuel pool on race day.
The 2006 Kentucky Derby and Preakness Stakes rank No. 1 and No. 2 respectively as Youbet's largest ever race day totals.
BoHorse
Brother Derek, the horse that was favored to win the 132nd Kentucky Derby, ran with Bodog.com as its exclusive sponsor. Bodog.com announced prior to the race that its brand was to be visible to thousands of spectators during Derby weekend at Churchill Downs in Louisville, Ky. The company held onsite events and presented a $25,000 check to Brother Derek's trainer, Dan Hendricks, in support of a charity to be named by Hendricks.
Packer's Tantalizing Offer
Australian media mogul James Packer has reportedly made a tantalizing new offer to racing industry broadcaster ThoroughVisioN (TVN). Packer's Publishing and Broadcasting Ltd. in March made a $25 million bid to TVN for a 25 percent stake in the company. Now PBL says Australian cable TV company Foxtel, in which it has 25 percent ownership, could be a partner in the offer. This will not up the offer price, but it could lead to TVN being carried in Foxtel's regular platform.
Betfair Bits
Christian Hellmers, Betfair's director of U.S. business development, said on May 4 during a panel discussion at the National Equine Law Conference in Lexington, Ky. that Betfair could boost the $134 million annual win wagering market in the United States by 59 percent if exchange betting was offered to U.S. customers. He also said that gross revenue in the United States under such a scenario would hit $30 million by 2007 and $50 million by 2008. The money, he said, would be shared in the form of purses by Betfair, racetracks and horsemen.
Australian media outlets reported Monday that after a series of meetings with Racing Victoria's integrity department and senior management, betting exchange Betfair is set to be given approval to operate on Victorian race fields in June. Racing Victoria Chairman Graham Duff said Tuesday, however, that these are premature assumptions. The RVL board, he said, did not have the issue on the agenda for its next meeting scheduled for June 1. He added that the board has yet to formulate a position on the subject. Betfair is reportedly set to meet with RVL again on Wednesday.
Tote Tactics
The British Tote announced this month that it intends to renew its £3 million sponsorship deal signed with Channel 4 in 2005 to gain on-screen credits at the beginning and end of each program and at either end of ad breaks. It will hold discussions with the Racecourse Association and the Levy Board before confirming how much it intends to pay.
The ROA's Proposal
The British Racehorse Owners Association (ROA) has asked a group of 25 wealthy owners to help fund the purchase of the Tote. ROA President-elect Stephen Crown and Jeremy Furniss, a partner at corporate finance specialists Livingstone Guarantee, are advising the ROA and recently met with the Department for Culture, Media and Sport (DCMS) to discuss the association's proposal, of which the association said the DCMS has been supportive. The proposal would see the initial set of investors help fund the purchase and then sell a portion of their shareholding to a broader set of investors within the racing industry. Online betting exchange Betfair in March proposed the possibility of entering into a partnership to keep the Tote within racing. The government remains committed to selling the Tote to a racing trust.
Competing with Online
Facing competition from Internet betting, Canterbury Park in Minnesota, where online betting is illegal, implemented some changes this season to keep bringing bettors to the races. The racetrack now has roving mutuel tellers taking bets on the grounds, upgraded betting machines and opportunities for uneducated bettors to learn how to pick winners. "We think focusing on live racing is the way to grow it," said Canterbury President Randy Sampson. "For better or for worse, that's the direction we're forced to go. Track officials are pursuing bills that would legalize online betting, allow slot machines at the track or expand Canterbury's card club.