04/22/2007 11:00PM

Youbet in contract dispute


Youbet.com, the online horse race wagering company, is unlikely to carry most signals from the tracks owned by Churchill Downs Inc. and Magna Entertainment Corp. this year because of a dispute over a provision in a contract being sought by a new Churchill-Magna company, Youbet announced on Monday.

Youbet.com's chief executive, Chuck Champion, said on Monday that officials of the new Churchill-Magna simulcasting arm, TrackNet, were requiring that Youbet.com drop a sub-licensing agreement with Television Games Network in order to receive the signals from Churchill and Magna tracks. TrackNet was formed earlier this year to sell and acquire racing signals for account wagering purposes.

"We don't know why anyone in the industry should have to choose one content provider over another when we are willing to pay fair prices for both," said Champion.

Youbet's announcement came five days before the opening of Churchill's spring meet on April 28. The Kentucky Derby, the highest-handling race in North America, is scheduled for May 5.

TVG's roster of tracks includes those operated by the New York Racing Association - Aqueduct, Belmont, and Saratoga - along with Del Mar, Keeneland, and Oak Tree at Santa Anita, among others. Youbet also operates an offshore rebate shop, International Racing Group, that would have to drop the TrackNet signals.

Last week, AmericaTab, a large account-wagering provider, said it would no longer carry races from TVG tracks as of May 5 because it had signed a deal with TrackNet. Youbet and AmericaTab were the only two large account-wagering companies in the United States that reached agreements with all signal providers in order to offer customers the widest range of signals.

Scott Daruty, the chief executive of TrackNet, said that the company objected to Youbet being the only account-wagering service that was carrying TVG's tracks on a sub-licensed basis, and so TrackNet was prepared to deny them its signals.

"We don't think they should be in a position that they are the only ones that can offer one-stop shopping and exploit that," Daruty said. "We are not prepared to allow that."