Fade to Black
One of the interesting things about Thoroughbred racing is the penchant so many people have of knocking something into oblivion, and later complaining about the fact it’s gone. Take TVG, for example.
David Nathanson, senior vice president and general manager of TVG, was given an opportunity on these pages (the Final Turn of Feb. 17, page 1130) to explain his company’s reliance on exclusive rights agreements with racetracks. Nathanson provided some background and statistics related to TVG’s reach (it’s now in 20 million American homes) and distribution of revenue from wagering ($220 million has been paid to tracks, horsemen, and the NTRA).
The knockers came out of the woodwork after Nathanson’s published defense of exclusivity. Most of the e-mails I received had nothing to do with exclusivity or contracts between TVG and tracks. They were critical of the programming, particularly the on-air talent, whether it related to perceived bad handicapping or bad hair. Some said they would prefer track feeds with no handicapping whatsoever. Others said TVG’s rival, HRTV, had smarter, less annoying on-air personalities. Hardly anyone had a kind word to say about anything TVG has done.
That isn’t new. Going back to TVG’s early days, Hall of Famer trainer D. Wayne Lukas dubbed it "mute TV"—an obvious reference to his frequent use of a television remote control’s mute button.
Everyone’s a critic, and just about everyone in horse racing is a handicapper. It’s the nature of a game in which you are betting against everyone else—not against the house—that you might think your opinion is superior to other handicappers, especially television talking heads.
The same week Nathanson’s commentary was printed, TVG released a statement saying it had broken off talks with Churchill Downs Inc. management to extend or renew exclusive contracts with the company’s four racetracks, headed by Churchill’s flagship facility in Louisville, Ky. For months, the industry’s worst-kept secret was that CDI and its new chief executive, Bob Evans, were not enamored with the terms of the exclusive contracts with TVG.
The departure of the Churchill tracks from TVG is a blow to horseplayers, and no matter how Nathanson spins it (he said the sale of several tracks by CDI was "diminishing its importance to our business"), it’s a blow to TVG, too. The result will leave the company without signals from racing’s two largest track owners, CDI and Magna Entertainment, which means TVG will not televise Churchill Downs, Fair Grounds, Calder, Arlington Park, Gulfstream Park, Santa Anita Park, Lone Star Park, Pimlico, and Laurel. It also means that programming from Churchill Downs throughout Kentucky Derby week will be missing, including the popular show "The Works," which allowed racing fans throughout the country to get a close look at the training regimen of most Derby contenders.
There is evidence that TVG can survive the loss of the CDI tracks. Gemstar-TV Guide, TVG’s parent company, has invested as much as $200 million since the racing network’s launch in 1999, and isn’t going to quietly walk away. TVG’s programming simply won’t be as good as it has been in the past because of the loss of so many top-quality signals.
CDI management can’t be blamed for not acting in the best interests of racing fans. CDI, like TVG and Magna Entertainment, is a publicly-held company whose first obligation is to its shareholders. TVG and Magna are acting on behalf of their shareholders too, when negotiating for the terms that best suit them.
Thus we have three public companies looking out for themselves in contract negotiations, on which they have so far failed to come to terms. The ultimate victims are the racing fans each of these companies need to survive.
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