TrackNet, THG Clarify 'Proposal' Stands

TrackNet, THG Clarify 'Proposal' Stands
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TrackNet Media Group said April 22 it doesn't like a proposal from horsemen that would allow advance deposit wagering companies the cards of the Kentucky Derby Presented by Yum! Brands (gr. I) and the Kentucky Oaks (gr. I), locking in place a stalemate over broader revenue sharing models.

Scott Daruty, president of TrackNet, said the April 21 proposal from the Thoroughbred Horsemen’s Group, which is negotiating license fees on behalf of Kentucky horsemen and others, contains the same one-third revenue sharing plan THG is seeking in all agreements.

“They have said they aren’t using the Kentucky Derby and Oaks as leverage for their overall business model, but in fact that’s exactly what they are doing,” Daruty said.

Daruty, who has repeatedly said the THG proposal is economically infeasible for racetracks and advance deposit wagering companies, said the attempt by the group to allow a wide distribution of ADWs to carry the Derby and Oaks cards is also a bargaining tool.

“They will say later, if you agreed to it for the Oaks and the Derby, why won’t you consent to it now?” he said.

THG has been locked in a well-publicized stalemate with TrackNet over a revenue sharing plan in regards to wagers handled by ADWs, but want the Derby and Oaks cards to serve as a temporary détente, similar in nature to proliferation of ADW signals negotiated for the 2007 Claiming Crown at Ellis Park.

THG president Bob Reeves earlier on April 22 clarified the group’s proposal to TrackNet on making wagering signals for the Oaks and Derby cards, which will be held May 2-3 at Churchill Downs, and are traditionally two of the sport’s largest wagering days.

Churchill Downs Inc., which owns TrackNet along with Magna Entertainment Corp., had written letters to the THG claiming Kentucky horsemen had in a 2006 contract already approved the distribution for three individual Churchill Downs races: the Derby, the Oaks, and the May 3 Woodford Reserve Turf Classic (gr. IT).

“What we are trying to do was get TrackNet to agree to offer the entire racing programs of the Oaks and Derby to all account wagering programs,” said Reeves, who acknowledged the respective contracts signed by the Kentucky Horsemen’s Benevolent and Protective Association and the Kentucky Thoroughbred Association. “Some of the media are confusing things.”

Reeves said that from his understanding, the provisions for the 2006 contracts approving the three races vary slightly, but do grant the approvals.

In related news, the Pennsylvania HBPA announced April 21 it would also use the THG to broker a deal with owner MTR Gaming Group for ADW signal rights to the Presque Isle Downs & Casino meet, which begins May 9.

It was previously announced that horsemen’s groups were allowing THG to negotiate deals at Lone Star Park, Calder Race Course, and Churchill Downs, which are all governed under the TrackNet content umbrella. But it was also recently announced that THG would represent Ohio horsemen in negotiations with Thistledown, a TrackNet track, and River Downs, which is independently owned.

“The point is that we are not just picking on TrackNet,” Reeves said. “Those race meetings (of TrackNet’s) just happened to come up first in chronological order. We have a great relationship with TrackNet -- at least up to the point of negotiating the ADW signals -- and I am looking forward to working with them on other issues in the future.”

Daruty claims THG is still “framing” these negotiations as a “TrackNet issue.”

“I’d just comment that I haven’t seen any other account wagering company step forward and say they’ll sign the one-third model,” he said. “That’s because it’s economically infeasible.”

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