Breeders' Cup Deal With TVG Poses Questions

A deal that gives the TV Games Network the exclusive right to conduct interactive wagering on Breeders' Cup Championship Day races has left other account-wagering providers wondering how the decision will impact their ability to carry the Breeders' Cup program Nov. 4 at Churchill Downs.

According to a release from TVG, the long-term license applies to pari-mutuel wagering through interactive television, online, and interactive voice-response telephone wagering systems. Breeders' Cup and TVG also will combine on promotional and marketing activities.

Ken Kirchner, director of simulcasting for Breeders' Cup, said the deal affects only interactive wagering tied to television, online, and automated telephone systems. For example, he said services offered by Greenwood Racing, Ladbroke, and associations in New York wouldn't be affected.

"It's my understanding that 98% of their business comes through operator-assisted calls," Kirchner said.

Hal Handel, chief executive officer of Greenwood's Philadelphia Park, said the company hadn't received an explanation, and probably would be notified by Churchill Downs through its simulcasting contract. Greenwood offers account wagering through automated services and live operators.

"What I can't get my hands around is under what right and authority Breeders' Cup has to come into Pennsylvania and dictate how we do business," Handel said. "That's what amazes me."

Ira Block, New York City Off-Track Betting Corp. attorney, said Monday the entity has attempted to "get some clarification" from Breeders' Cup on the effect the deal could have on its operations. "At the moment, TVG is not accepting accounts, let alone wagers, from people in New York, so I don't believe there will be any meaningful impact, at least currently," he said.

In 1999, Breeders' Cup handled about $4.5 million through account wagering services, while total handle topped $100 million. John Hindman, director of communications for TVG, said there is no handle projection, at least for this year.

Kirchner said interactive handle would "depend on what we anticipate will be a much greater rollout by TVG" in future years. Officials had hoped TVG's wagering service would be available in California in time for the Breeders' Cup, but California Gov. Gray Davis vetoed an account-betting bill late Saturday.

Officials couldn't say what effect the deal would have on account-wagering providers in future years should TVG expand it scope as planned.

Kirchner said the deal with TVG would affect Youbet.com, which offers computer-based automated betting. "Customers would be excluded via the Youbet platform, but Youbet customers are customers of Ladbroke's Call-a-Bet system, so they could use Ladbroke's 800 number to wager," he said.

Ladbroke's system is based in western Pennsylvania at Ladbroke at The Meadows, a Standardbred track.

In making the announcement, Breeders' Cup president D.G. Van Clief Jr. said: "TVG is our choice to develop interactive wagering because it possesses strong marketing resources, professional programming and promotion, several operational proprietary interactive wagering platforms, the desire to draw new fans to the Breeders' Cup and, importantly, the commitment to support the racing industry through source market fees -- a fair revenue-sharing plan for proceeds from interactive Breeders' Cup wagering."

Some other providers, including Greenwood, said they also have a desire to attract interest in the Breeders' Cup. Greenwood, a principal in The Racing Network, apparently had hoped to eventually send Breeders' Cup races to Great Britain as part of a daily program it intends to launch in October.

"We're trying to promote American racing, not restrict it," said Bill Hogwood, president of TRN.

The Breeders' Cup/TVG partnership has other implications. The National Thoroughbred Racing Association has taken heat from some of its members for its marketing partnership with TVG, and in a couple of months, the NTRA and Breeders' Cup are expected to complete their consolidation. The three entities will be even more closely linked.

"How is this supposed to be a building block to have everyone feeling warm and fuzzy (about the NTRA)?" Handel said. "You have to count to 10 on something like this. The NTRA is supposed to be sensitive to the Mid-Atlantic's concerns, but there's this incestuous relationship with TVG. We'll have to take a serious look at it."

Chip Tuttle, vice president of communications for the NTRA, said there is "a big misunderstanding in this deal" due to inaccurate media reports. Tuttle agreed with Kirchner that NTRA members that offer account wagering wouldn't be greatly affected by the Breeders' Cup/TVG deal.

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