01/30/2015 3:20PM

Hints of progress in talks between Stronach Group, Mid-Atlantic tracks


Now two months old, a simulcasting dispute between a company controlled by the Stronach Group and a group of racetracks has shown some signs of progress over the past several weeks, according to an official involved in the discussions, though a deal has not been reached.

The dispute, which has blacked out some of the most popular signals in the U.S. at offtrack betting sites in Ohio, Pennsylvania, and Texas, among other states, since early December, has been locked in a stalemate over the pricing of the signals. Both sides have traded proposals over the last two months, and the latest round of talks is signaling that an agreement may be near, the official said.

“We’ve exchanged another proposal, and we’ve had movement on both sides,” said Phil O’Hara, the executive directive of the Mid-Atlantic Cooperative, a collection of 23 Thoroughbred and Standardbred tracks that banded together a decade ago to increase their leverage in the simulcast market. “Things are progressing.”

Late last October, talks between the Mid-Atlantic Cooperative and Monarch Content Management broke down over Monarch’s demand that the tracks within the cooperative pay different rates for simulcast signals based on whether the tracks held live Thoroughbred racing or not. Monarch is a division of the Stronach Group, and it controls the rights to Stronach-owned tracks like Gulfstream Park, Santa Anita, and Golden Gate Fields, along with other tracks, such as Tampa Bay Downs.

Monarch officials did not respond to requests for comment by early Friday afternoon.

The Stronach Group owns a national account-wagering company, XpressBet.com, which allows customers to bet on the affected signals. While residents of some of the affected states can open accounts with the service to get access to the tracks, other affected states, such as Texas and Pennsylvania, have restrictions on account wagering that have frustrated horseplayers seeking to bet on the Monarch signals.

With players in some of the states increasingly being pushed toward account-wagering options to bet on the likes of Gulfstream and Santa Anita, pressure has been building on the cooperative to strike a deal. That’s not necessarily the case for Monarch, whose parent company derives far more revenue from a bet through XpressBet than at an unaffiliated offtrack site.

“It’s been very challenging for all our co-op members,” O’Hara said.

Monarch officials have stated in the past that they believe harness tracks and tracks that no longer hold live racing should pay a higher rate than those sites in the co-op that share a portion of their simulcasting revenue with their horsemen. A previous agreement between the two sides had treated all sites within the co-op equally as far as price.

The Mid-Atlantic co-op includes 12 harness tracks, along with several tracks, such as Suffolk Downs and Colonial Downs, that are not currently expected to host live race meets this year or did not run a live meet last year.