For all the differences between the horseracing and betting landscapes in Britain and North America - size, history, administration and race and bet types, - one similarity of principle has emerged over the last five years. The live televised racing scene has crystallised into two entities, and the impact on both the foundation and prosperity of the sport and the availability of its betting facilities has been thrown into the blender.
In Britain, the 60 racecourses have lined up equally between the two cable and satellite broadcasters - Racing UK (RUK), with 30 tracks on board, and At The Races (ATR), with 29, but soon to become 30 when the new venue of Great Leighs attains its long-awaited completion. In North America, the dominance and extensive exclusivity of TVG has been challenged by the major corporate racetrack owners Magna Entertainment Corp. (MEC) and Churchill Downs Inc., which have jointly formed the cable and satellite broadcaster Horseracing TV (HRTV), shutting out TVG from coverage of their many high-quality courses.
Into the mix have been catapulted bookmaking, advance deposit wagering and online betting facilities, the biggest attraction for the public and the most significant cash provider for racing outside the deep pockets of racehorse owners. What will come out at the other end, and when, is impossible to say with any certainty. Interested parties have their own views, based on which side of the divide they sit, but it would take someone akin to a soothsayer, let alone an experienced industry observer, to imagine where the path will lead. The road-makers are still at work, using different maps to plot their separate ways, and sometimes giving the impression they are making up the journey as they go along.
Two examples of intricacies that can only ripen confusion and spread uncertainty are worth recording, before attempting to untangle the web spun by rights-holders seeking to manage content to best advantage. Ascot, Britain’s best-known international venue, lined up with At The Races when the second coming of that daily satellite broadcaster emerged from the ashes of a failed venture known as Attheraces in June 2004. At the time, as Ascot negotiated with its bankers over loans to service a £200 million redevelopment scheme, huge uncertainty surrounded previous rights, which may have meant Ascot having to repay a significant sum. Partly to allay the fears of financial institutions, Ascot fell in with ATR, and was given a five per cent stake in the company for its allegiance.
However, the contract, which runs until 2012, did not include pictures supplied to betting shops, and when these came up for renegotiation earlier this year, Ascot decided to jump on to the back of another media rights horse. It sided with Amalgamated Racing - Amrac for short - which had set up a joint venture with the stock market-quoted betting-shop services provider Alphameric to introduce a new channel, Turf TV, offering pictures from aligned courses to off-track bookmakers. Until then, for 20 years the betting industry had had only one company to deal with, Satellite Information Services (SIS), which took pictures from Racing UK courses under contract, and by sub-contract from At The Races’ courses through an organisation called Bookmaker Afternoon Greyhound Service (Bags). Bags has outgrown its title by owning horseracing rights and covering evening racing, while ATR controls no betting-shop picture rights in Britain, but it does use SIS to produce its programmes on a daily basis, and has a contract with it to distribute pictures into betting shops in overseas territories such as Sri Lanka.
Confused? You soon will be… Explaining the decision to go with Amrac, Ascot’s finance director Janet Walker says: “We believe Amrac is the best vehicle for racing’s commercial relationship with the betting industry. And the decision has no impact on our separate satellite media rights arrangement with ATR, and should in no way be interpreted as a negative reflection on our relationship with that company.”
In North America, the picture began to get decidedly murkier in March this year, when Churchill Downs bought a 50 per cent stake in HorseRacing TV, which had previously been owned wholly by Magna. It was the biggest in a series of deals that the two sides concluded at the time, and out of the arrangement came the formation of another joint venture called TrackNet Media Group, through which one partner’s horseracing content would become available to the other’s various distribution platforms - Magna’s advance deposit wagering (ADW) site XpressBet, Churchill’s similar newcomer TwinSpires.com. TrackNet would also deal with providing content, from pictures to betting availability, for third parties, it emerged. These were to include racetracks, OTBs, casinos and other ADW operators - but not TVG, it seemed; well, not without a groundbreaking change of heart. HRTV immediately took over coverage of Churchill Downs, and as contracts run their course, it picked up exclusive rights to Arlington Park on August 6, Fair Grounds in November and Calder on January 3, 2008. It was not long before the consequences became clear. The 2007 Kentucky Derby was shown exclusively on HRTV and bet on through TwinSpires and winticket.com (whom Churchill Downs subsequently purchased). TVG and its wagering partner Youbet did not get a look-in. The same applied to the second races in the US Triple Crown, the Preakness, run at Magna-owned Pimlico, but come the last leg, the Belmont, exclusivity returned to TVG, under its contract with the New York courses. Just before the Kentucky Derby, a contributor to the Turf’n’Sport website was moved to remark: “At the best possible time of the year for generating positive horseracing buzz, the industry has succeeded in turning on itself and creating negative headlines.
At a time when online racebooks that offer betting on all major Thoroughbred tracks continue to make inroads, and at a time when the World Trade Organisation has ruled America must open up horse betting to offshore racebooks, the existing companies are bitching at each other.” The punchline summed up: “How long will it take horseplayers to catch on and simply move their accounts offshore?” He clearly is not the soothsayer identified earlier, who might supply the answer to what will come out of the mix. But he does have a point.
A similar observation holds good in Britain, though with a different emphasis. At times the two sets of particular circumstances in Britain and North America do run along parallel lines, but at others they are subtly interlinked and completely separate. The differences, and some of the connections, can be seen in the betting arena, where HRTV and TVG have their own direct outlets, but Racing UK has a joint venture and At The Races remains corporately aloof while relying on bookmaker partners to provide one of 30 income streams. The key in Britain is Turf TV, the betting-shop channel set up in part by the Racing UK courses, which flickered into life with six exclusive members (including Ascot) and a small percentage of betting-shop supporters, mainly small independents until the Tote joined up, but none of the four majors, which account for 80 per cent of the UK estate.
On January 1, Turf TV will be bolstered by 25 other RUK courses. The split will be equal - just as it is in the choice facing satellite viewers, who need two TV accounts to cover the field - and the dominant bookmakers, who have lined up solidly behind SIS and the status quo, will have to decide whether they can survive on half rations for their horseracing coverage. On that decision could depend a large slice of British racing’s future prosperity. The situation in North America depends on whether racecourse and betting operators choose TrackNet or TVG. It seems they cannot have both. In each case, the participants have made their positions clear.
Robert Evans, president and CEO of Churchill Downs, told a shareholders’ meeting: “I understand our objectives on occasion may ruffle a few feathers. That is one of the things about competition. It is not really our intent just to go out and be disruptive. Our intent is to compete aggressively and to attract more customers to our business. There are always a few potential consequences when you challenge the status quo.” In response to the Kentucky Derby impasse, TVG general manager David Nathanson said: “We attempted to negotiate with TrackNet Media and its owners in good faith, but thus far have not seen any terms from them indicating a strong desire to reach a mutually beneficial long-term agreement. We remain open to negotiating an agreement that is in the best interest of the racing industry, the respective parties and, ultimately, the racing fan.”
In Britain, Turf TV has become the dividing line between broadcasters and rights-holders Racing UK and At The Races. RUK executive chairman Simon Bazalgette reflects: “Historically British racing has not been good at being commercial about negotiating its media rights, and has allowed third parties, such as BSkyB (the satellite provider) and the bookmakers, to get a lot of the economic benefit. Now racecourses can manage the business themselves, keeping more of the commercial benefit in racing and having greater control over the presentation of the sport. Turf TV is a great deal for the racecourses.” ATR chief executive Matthew Imi takes a dispassionate view of Turf TV, since betting-shop rights do not figure in his company’s portfolio. “It will be interesting to see how it works out, but we’re not threatened by Turf TV,” he says. “The most fascinating aspect is not whether Turf TV gains any material traction among the big bookmakers, but what the net effect will be on British racing. For us, though, it’s a valuable opportunity to concentrate on our core business, which is to exploit our partners’ rights. Getting together in the UK with Racing UK is not on our radar.” It might not be war, but for the moment, and maybe for the foreseeable future, it clearly is every man for himself.
HOW THE TELEVISION BROADCASTERS LINE UP NORTH AMERICA HORSERACING TV (HRTV)
Owned by: Joint venture of Nasdaq-listed Magna Entertainment Corp. (MEC) and Churchill Downs Inc. Operates: Subscription national cable and satellite TV horseracing network. Live racing content is acquired by sister company TrackNet Media Group. Estimated coverage 11 million homes. Racetracks covered: 70-plus Thoroughbred, harness and Quarter Horse tracks, including Santa Anita Park (California); Churchill Downs (Kentucky); Gulfstream Park, *Calder (Florida); Lone Star Park (Texas); Arlington Park (Illinois); Pimlico (Maryland). International: UK tracks on Racing UK. MEC operates off-track betting network, and national account wagering business XpressBet. Churchill Downs recently opened online national account wagering service, TwinSpires, and more recently acquired account wagering operator AmericaTAB and affiliates. Overseas coverage: Racing World channel in Britain, joint venture with Racing UK. *effective January 3, 2008 TVG Owned by: Gemstar-TV Guide International Inc., global multi-media and technology company, including loss-making TV Guide magazine, in which Rupert Murdoch’s News Corporation has 41 per cent stake. Operates: Subscription national cable and satellite TV horseracing channel, and online betting network. Estimated coverage 50 million homes. Racetracks covered: Turf Paradise (Arizona); Del Mar, Fairplex Park, Hollywood Park, Los Alamitos, Oak Tree (California); **Calder (Florida); Prairie Meadows (Iowa); Ellis Park, Keeneland, Kentucky Downs, Turfway Park (Kentucky); Meadowlands, Monmouth Park (New Jersey); Ruidoso Downs, Zia Park (New Mexico); Aqueduct, Belmont Park, Saratoga, Yonkers Raceway (New York); Emerald Downs (Washington). International: Japan, UK tracks on At The Races. Some contracts with tracks owned by HRTV partners due to expire over next year. Has arrangement with online account wagering operators Youbet and The Racing Channel. Overseas coverage: At The Races in Britain, through arrangement with TRNi and the Dubai Sports Channel in the UAE. **through January 2, 2008 BRITAIN RACING UK (RUK) Owned by: 30 British racecourses, split Jockey Club Racecourses (50%), Chester, Goodwood, Newbury, York (sharing 25%), 11 smaller courses (sharing 25%). Owns all rights, including terrestrial TV, except for licensed betting offices (belong to Amrac, see below and facing). Operates: Subscription national cable and satellite (via BSkyB service, part of Setanta Sports package) TV horseracing channel, with links to small number of bookmaker partners; international channel, Racing World, in partnership with MEC and Churchill Downs; licensed betting-office channel, Turf TV, set up by Amalgamated Racing (Amrac), joint venture between Racecourse Media Services (separate company owned by RUK courses and Ascot) and betting-office provider Alphameric; overseas delivery of pictures and data from RUK courses in association with South Africa-based racetrack and betting operator Phumelela. About 200,000 subscribers (including Setanta, forecast to grow to 1 million when Premiership football comes on stream in Autumn 2007). Racetracks covered: Aintree, Ayr, Bangor, Beverley, Carlisle, Cartmel, Catterick, Cheltenham, Chester, Epsom, Goodwood, Hamilton, Haydock, Huntingdon, Kempton, Ludlow, Market Rasen, Musselburgh, Newbury, Newmarket, Nottingham, Pontefract, Redcar, Salisbury, Sandown, Thirsk, Warwick, Wetherby, Wincanton, York. International: France, Dubai, occasional other major races; HRTV (see above) coverage of North America on separate channel, Racing World. Overseas coverage: North America, joint venture with HRTV; Australia, jointly with At The Races; other territories, partnership with Phumelela (South Africa). AT THE RACES (ATR) Owned by: broadcaster British Sky Broadcasting (46%), racetrack owners Arena Leisure (46%) and Northern Racing (2%), and racecourses Ascot (5%), Newton Abbot, Plumpton and Ripon. Owns all media rights of participating courses except licensed betting office and terrestrial TV rights. Operates: National cable and satellite (part of Sky Sports package) TV horseracing channel, with links to bookmaker partners. ATR courses shown in betting shops through agreement with Satellite Information Services (SIS), which sub-contracts rights from Bookmaker Afternoon Greyhound Service (Bags). BSkyB subscription platform covers 8.5 million homes in UK. Racetracks covered: Ascot, Bath, Brighton, Chepstow, Doncaster, Exeter, Fakenham, Folkestone, Fontwell, Hereford, Hexham, Kelso, Leicester, Lingfield, Newcastle, Newton Abbot, Perth, Plumpton, Ripon, Sedgefield, Southwell, Stratford, Taunton, Towcester, Uttoxeter, Windsor, Wolverhampton, Worcester, Yarmouth. (Great Leighs will become 30th on opening). Plus all 27 Irish courses. International: France, Dubai, Germany, occasional other major races; TVG (see facing) coverage of North America. Overseas coverage: North America, arrangement with TRNi, through to TVG; Australia, jointly with RUK; other territories, distribution by SIS.