Network moves billions in bets

NEW YORK - The totalizator system that links hundreds of betting outlets inside and outside the United States processes billions of dollars in wagers every year on Thoroughbred racing and other parimutuel sports. The system includes everything from tote machines manned by clerks behind grandstand mutuel windows to computers that sit in climate-controlled rooms with restricted access.

Four tote companies operate in the United States - Autotote, United Tote, AmTote, and Las Vegas Dissemination Company, a relatively small operation that serves most of the Las Vegas casinos, several offshore sites, and North Dakota Racing Services. Autotote is by far the largest tote company, with 65 percent of the market share of the country's parimutuel wagering. AmTote and United Tote split the rest of the market, with the exception of the Las Vegas Dissemination clients.

The computer systems operated by the four tote companies can communicate with each other through a language called the Inter Tote System Protocol, or ITSP, which was developed at the request of Thoroughbred Racing Associations, a racetrack trade group. ITSP was developed after the racing industry began to embrace full-card simulcasting in the early 1990's.

Tote systems commingle wagers - or combine them - by using a complex hub-and-spoke system that enables bets to be merged into the system at a variety of different sites and through different methods. Ultimately, the betting data is consolidated at the host track, which in nearly all circumstances is the site of the live race and which serves as the national hub for the final calculations to determine payoffs.

Information about a bet can be forwarded through several systems before it ends up at the host site. A $2 win bet placed with a mutuel teller at an OTB in New York, for example, may be transmitted to the OTB's headquarters, where all of the OTB's bets are consolidated, before being sent to a regional hub, where it is consolidated with other wagers, and then finally to the host site.

The racing industry has 54 hubs, which are defined as any site "with a self-standing computer that can do price calculations," according to Chris Scherf, executive vice president of Thoroughbred Racing Associations. Several of those hubs are known as superhubs, which are able to merge data from other hubs.