01/12/2004 1:00AM

Magna handle takes big dip


Out-of-state handle on Gulfstream Park's signal has dropped 14 percent this year compared to last year through the first seven days of the meet, a sign that Gulfstream's aggressive new policy of policing who has access to its signal has so far had a negative impact on wagering.

The new policy was put in place late last year by Gulfstream's parent company, Magna Entertainment Corp., the largest racetrack operator in the country. New restrictions include cutting off many account-wagering sites from Magna's popular winter signals, including Santa Anita, Golden Gate, and Gulfstream, and charging horseplayers for access to Magna's live racing signals over the Internet.

The decline is coming at a time when Gulfstream's signal appears to be more bettable than ever. Since opening on Jan. 3, the track has enjoyed good weather, full fields, and, on Saturday, national headlines related to Funny Cide's 2004 debut. On the negative side, players at four outlets in western Florida were prohibited from betting on Gulfstream through the first three days of its meet due to a dispute with Tampa Bay Downs.

Similar declines have hit Magna's Santa Anita, which has been plagued by short fields, as have all California tracks over the last six months. Since Santa Anita's meet started on Dec. 26, all-sources handle has been down approximately 16 percent.

Some of the declines at both tracks may be related to the hard feelings that Magna's new restrictions have engendered across the country. Criticism about Magna withdrawing its signal from other account-wagering operators has dominated Internet horse racing discussion groups lately, and a new Internet site, www.boycottmagna.com, was launched last week with the intent of uniting players behind an effort to hurt Magna's tracks. As of late Monday morning, a roster of players who have vowed to honor a boycott had reached 81at the site.

Gulfstream officials said Monday that they are not yet concerned about the declines. Scott Savin, the president of Gulfstream, said he was confident that business trends would reverse soon based on handle numbers over the weekend.

"We were down 8 percent on Saturday, and we were flat on Sunday, so we think it is beginning to turn around," Savin said, referring to offtrack handle. Savin blamed the current declines on horseplayers' unfamiliarity with Magna's account-wagering platform, XpressBet, which has struggled to gain customers and market share in the rapidly expanding business of account wagering.

Magna apparently is also losing bettors at offshore wagering outlets, which typically attract big bettors by giving rebates.

Savin said that Magna was charging rebate shops the "same effective blended rate" as last year for the company's signals. But Kirk Brooks, the president of one of the most popular rebate shops for U.S. racing, Racing and Gaming Services of St. Kitts, said that Magna had raised the rates for Gulfstream and its other popular winter track, Santa Anita, which has driven some of his customers to other racing signals.

Many rebate players are professional horseplayers who rely on the cash-back awards to turn a 1 percent to 2 percent profit. Any increase in the price of a signal usually eats into that margin.

Brooks said that his players were not betting Gulfstream at the same rate as last year. He said that despite the drop in business on Magna's tracks, handle through his shop has been up 1 percent overall this year. "Other racetracks are reaping the rewards," Brooks said.

An e-mail that Magna's customer service department sent to players who complained about Magna's new policy said that Magna did not intend "to dominate anyone" by the restrictions.

"But neither do we want to be dominated by anyone else," the response went on. "One of our goals is to provide stability to the industry so track operators, breeders and owners can plan for the long term; (sic) which will have tremendous benefit to the current fan and will help grow the overall fan base."

Savin said that Magna has amended the e-mail response to include more information on XpressBet and how players can open accounts with the service.

"Originally we gave the players some philosophical answers, when really what they wanted was wagering answers," Savin said. "I think there were a lot of misconceptions out there about XPressBet. We had to tell them that you can bet other tracks than Magna's at XpressBet, and that you can get free live streaming video if you sign up for an account."

The drop in business at Gulfstream is coming one year after Magna completed work on Palm Meadows, a $100 million training facility north of Gulfstream. Though racing officials approved of the training facility as a way to increase field size, many financial analysts questioned the high cost of the development.