Louisiana HBPA Says No to TVG Exclusive Deal

The Louisiana Horsemen’s Benevolent and Protective Association has decided not to consent to the sending of the signal from Evangeline Downs Racetrack & Casino to TVG under the current exclusive arrangement between the track and racing network.

The decision, announced April 5, was made on the belief the exclusion of the other competing account wagering companies is not in the best interest of Louisiana horsemen or the racing industry, the Louisiana HBPA said. Other companies would have access to the Evangeline Downs signal under a sub-licensing agreement, but horsemen said the deal isn’t favorable.

Evangeline Downs launched its 2007 Thoroughbred meet April 4.

The Louisiana HBPA board of directors unanimously authorized president Sean Alfortish, an attorney, to take all necessary action to withhold consent from any Louisiana track entering into exclusive agreements with TVG.  The Louisiana HBPA said it’s willing to consent to giving TVG the Evangeline Downs signal under “acceptable terms” of a non-exclusive agreement.

Horsemen under the Interstate Horseracing Act of 1978 have the right to give consent before signals can be transmitted across state lines.

“Under the terms of the TVG ‘exclusive’ simulcasting contract, TVG makes more money on their host fee than the hosts, Louisiana horsemenand Evangeline Downs, combined,” Alfortish said in a statement. “TVG also holds the exclusive right to sell the simulcasting signal to other TVG competitors such as Youbet.com and AmericaTAB, and offers the simulcasting signal for sale in exchange for a host fee that is almost triple what has been the fee in the past, with the overwhelmingly larger share of the fee being retained by TVG.

“The Louisiana HBPA believes that the effect of TVG’s resale method has been the pricing of TVG’s competitors ‘out of the market,’ meaning the growth of the market for our simulcast signals is stifled. It is a historic fact that Youbet.com has not taken the Evangeline Downs signal since the last meet, and as a result, the horsemen and track are missing out on the millions of dollars wagered on Youbet’s share of the market.  This TVG exclusive agreement seems to provide an unfair impediment to the open market place where horsemen and tracks have the greatest opportunity to maximize their revenue from their product.”

John Hindman, vice president of communications and general counsel for TVG, couldn’t be immediately reached for comment April 6.

In an interview earlier this year with The Blood-Horse, TVG senior vice president and general manager David Nathanson said revenue from sub-license fees is used to improve production and distribution for the network, which also offers account wagering, and also said exclusivity is key to making products stand out in the marketplace.

“We’ve been vilified,” Nathanson said in January. “Let’s look at the facts. Since our inception, we’ve generated about $220 million that we’ve given back to horsemen and racetracks.

Nathanson also said the sub-licensing model has enabled Youbet.com and AmericaTAB to become the No. 2 and No. 3 account wagering providers in terms of handle behind TVG.

The Louisiana HBPA said it has other concerns about the TVG exclusive contract because TVG’s televised programming routinely shows Evangeline races after they are over or not at all. TVG has reasserted the Evangeline Downs signal will not be shown live if any other track with an exclusive TVG agreement is racing.

Last year, the Illinois Thoroughbred Horsemen's Association denied its consent for Hawthorne Race Course to send its signal to TVG under an exclusive arrangement.

Exclusive contracts between TVG and Churchill Downs Inc., which owns Fair Grounds in Louisiana, began expiring in March. CDI expects to launch its own account wagering system before the start of the Churchill Downs spring meet April 28.