Keeneland Not Immune From Simulcast Decline

Simulcast handle at most Kentucky racetracks has fallen or remained static in each of the past several years. An exception has been Keeneland, which experienced nine consecutive years of growth through 2000, when the amount wagered on simulcasts topped a record $104 million.

Through July 8 of this year, though, handle on simulcast-only days at Keeneland was down $4.3 million, or about 8%, from the same period in 2000.

Keeneland officials aren't sure why simulcast handle has fallen this year, and to complicate matters, this year's live spring meet was up 2.1% in on-track handle, and 8.5% in on-track attendance, from last year's comparable meet.

In early July, the Matrix Group of Lexington surveyed simulcast customers at Keeneland to get their input. Several questions dealt with patrons' viewing and wagering habits as they relate to the TV Games Network, which debuted on basic cable in the Lexington market the last week of 2000.

The survey dealt solely with pari-mutuel wagering and didn't discuss casino gambling, which has been targeted as a major cause for the decline in wagering at Kentucky tracks. Those most affected -- Churchill Downs, Ellis Park, Turfway Park, and Players Bluegrass Downs, a harness track -- are located near the Ohio River, where riverboat casinos operate in bordering Indiana and Illinois.

Keeneland has surveys done from time to time for all aspects of its business. "You have to remember we're comparing this year's numbers to the best year we've ever had," said Jim Williams, Keeneland's director of public relations. "It's difficult to zero in on a particular factor (for the decline). Is it the economy? Is it competitive forces? Or are some players just not coming (for simulcasting) as often as they once did?"

For the first six months of 2001, excluding Keeneland's live meet, Lexington account-holders have wagered about $1.7 million through TVG's Oregon hub. When the live meet is factored in, the number increases to $2.085 million. It's possible some Keeneland patrons have chosen to watch races at home and wager through TVG accounts. Then again, some of it could be new money. In any event, officials said it's far too early to assess the impact of account wagering in the Lexington market.

"TVG is every day helping to preserve brand loyalty of Kentuckians to racing against enormous economic competition that's targeting the Kentucky racing industry," said Mark Wilson, chief executive officer of TVG. "Without TVG in Kentucky, I think there would be a double whammy."
In the Louisville, Ky., market, purses continued to rise at Churchill Downs for years after an account wagering program was launched. They've declined a bit since 1998.

With the advent of direct casino competition, the Churchill Sports Spectrum simulcasting facility in Louisville has experienced double-digit declines in handle, said John Asher, vice president of communications for Churchill Downs.

Some other tracks in the state appear to be holding their own so far this year. The Red Mile, a harness track located about five miles from Keeneland, is up about 7.5% in simulcast handle on Standardbred racing for the first six months of 2001.

At Turfway in Northern Kentucky, handle on simulcast-only days is down only 1% for the first six months of this year. (On most days from January through the first week of April, Turfway offers live racing.)
Track president Bob Elliston said there was resurgence in wagering after the Kentucky Derby in early May. Handle in May was down 1%, but it jumped 15% in June. It appears July's figures will be up a bit, he said.

For the first six months of 2001, the TVG hub handled a total of $19.1 million. Kentucky-only handle wasn't available.

Marty Maline, executive director of the Kentucky Horsemen's Benevolent and Protective Association, said almost $800,000 in TVG source-market fees was returned to Kentucky purses from January through June. For the first three months of the year, $280,000 went to purses; for April, $121,000; for May, $231,000; and for June, $167,000.

The five Thoroughbred and three Standardbred tracks in the state split the revenue according to a market-share formula.