Anne M. Eberhardt

Topics: THG and Future of Racing on TV

The THG believes it will continue to impact advance deposit wagering economics.

The Thoroughbred Horsemen’s Group, which advocates a new economic model for pari-mutuel wagering and has been engaged in high-profile battles in the racing industry, isn’t going away anytime soon, its president said July 18.

“This is just the beginning,” Bob Reeves said during the National Horsemen’s Benevolent and Protective Association summer convention in Hershey, Pa.

Reeves brought National HBPA affiliates up to speed on the THG, which has 18 member horsemen’s associations, as well as the economics of pari-mutuel wagering. The focus of the THG has been on advance deposit wagering, which it believes doesn’t return enough revenue to purses in most cases.

Earlier this year, the THG struck an agreement with the six New York off-track betting corporations, a development Reeves said is huge given the fact the six OTB systems combined account for about $2 billion in handle each year. Reeves offered no details of the agreement but did say the OTB corporations pay licensing fees to the THG.

“They apparently see the value of talking with the THG,” Reeves said. “We executed a written agreement with all six corporations. We have validated our business model with the most sophisticated bet-taker in the United States.”

The THG remains in a dispute over ADW revenue with Churchill Downs Inc., which owns Calder Race Course in South Florida. Before CDI and the Florida HBPA signed an agreement on purses and revenue from slot machines, the six OTB corporations in New York were the only out-of-state wagering outlets permitted to import the Calder signal.

Reeves, who called the THG “the only feasible opportunity for owners to meet the challenges” of the new wagering environment, noted that he and other THG directors have been sued by CDI. National HBPA president Joe Santanna, also a THG director, joked about the lawsuit when he presented Reeves with the National HBPA Industry Service Award for his work with the THG.

“We honor Bob for an unbelievable job,” Santanna said. “If we do go to jail, I’m asking for the cell right beside him.”

Earlier in the day, Keeneland president Nick Nicholson said discussions with Reeves and others about ADW have led him to wonder about the future of horse racing on television networks such as HRTV and TVG. Nicholson issued a warning of sorts and suggested ADW revenue as a means to keep racing on TV.

“If you care about racing on television, if you like TVG and HRTV, I’m telling you it’s in jeopardy,” Nicholson told National HBPA affiliates. “The big racetracks don’t care about these entities and aren’t going to pay (for TV coverage). If don’t find a way to pay for TVG and HRTV, they are going to go away.”

Nicholson said ADW revenue could be used in part to pay a “broadcast fee” to support televised racing.

Keeneland and Turfway Park, of which it is a 50% owner, have exclusive agreements with TVG that expire in 2009. Officials at both tracks have said live coverage of their racing product on TVG has helped handle. In addition, the two tracks now get all source-market fee revenue paid by TVG in Kentucky as the only TVG-exclusive tracks in the state.

Horsemen’s groups have said they support wide distribution of signals through ADW outlets and don’t have a problem with broadcast exclusivity or fees paid to support TV exposure.