Horsemen seek bigger slice of Internet pie

Jul 22, 2008 7:06 PM

By GT Staff | It’s no secret the pari-mutuel horse racing industry has been stagnant the past few years – the amount bet over the last five years has dropped 3 percent. At the same time, the amount bet over the Internet and by telephone into advanced deposit wager (ADW) accounts has skyrocketed.

The disconnect hasn’t sat well with the race tracks and trainers, who typically receive just a small portion of the Internet pie while the simulcast companies and OTBs get rich.

For instance, typically in racing about 82 percent of the gross pari-mutuel handle is returned to the winning bettors. The remaining 18 percent is split between the tracks, the trainers and the account wagering companies.

Of the 18 percent, the lion’s share – up to 80 percent – would go to the ADWs. The math doesn’t add up for track owners and horsemen who believe they should have a larger slice of the pie.

The horsemen at Ellis Park in Kentucky a couple of weeks ago took steps to correct what they perceived as a pari-mutuel injustice. The result was a better deal, and more money for the horsemen in charge of putting on the show.

The horsemen’s representative – the Kentucky Horsemen’s Benevolent and Protection Association – threatened to block the simulcast signal sent to OTBs if they didn’t receive a better cut.

Ellis Park, faced with the prospect of cutting purses or closing the track, opted to give its share of the pari-mutuel handle to the horsemen.

To help compensate for the loss of revenue, Ellis cut a deal that would make its races available to 10 Internet platforms, rather than one or two account wagering companies.

Similar disputes earlier this year affected the size of purses at Churchill Downs and Calder Race Course.