Twinspires, XpressBet see betting declines for first quarter

Handle through two of the three leading national account-wagering platforms in the United States declined in the first quarter of 2011 compared with the first quarter of 2010, according to the platform operators and regulators in Oregon, where the platforms have betting hubs. The decline signals a contraction in the account-wagering market for perhaps the first time.

Combined with a slight increase for the third large account-wagering operator the overall 7.9 percent decline is the first significant quarter-to-quarter drop for the leading operators in the account-wagering sector, which has been the only growing component of the national wagering market over the past several years. The decline far exceeded a 1.8 percent contraction in race days during the quarter and was a significant component in an 8.5 percent decline in total wagering on U.S. races for the first three months of the year.

Overall, handle through the three dominant account-wagering platforms was $365.5 million in 2011, compared with $397 million in the first quarter of 2010, according to the figures. The figures do not include totals from account-wagering platforms that do not have a hub in Oregon, but those operations, such as the New York Racing Association’s NYRA Rewards account-wagering service, typically serve local markets.

The decline was most strongly influenced by handle figures through the leading account-wagering company, Churchill Downs Inc.'s Twinspires.com, which merged with Youbet.com in the fourth quarter of last year. In the first quarter of 2010, combined handle through the two companies was $201.1 million, according to Youbet records and the Oregon Racing Commission, while in the first quarter of 2011, handle through Twinspires.com was $178.1 million, for a drop of 11.4 percent.

Rohit Thukral, the president of Twinspires.com, said through a Churchill spokesperson that the company believed the declines were related to overall weakness in the parimutuel market, citing reduced race days and smaller field sizes. Thukral also said that customers of Youbet who were moved to the Twinspires service when the two companies merged were in an “adjustment period” as they learned the features of the Twinspires website.

Handle through XpressBet also dropped on a quarterly basis, dipping 3.7 percent from $50.9 million to $49 million, according to the Oregon records. XpressBet, owned by MI Developments, has had declines on a quarterly basis in the past. The account-wagering platform is scheduled to be transferred to a company headed up by Frank Stronach on June 30, along with the other racing and gambling assets owned by MI Developments.

The only major account-wagering platform to post a quarter-to-quarter increase in wagering was Television Games Network, with quarterly handle of $138.4 million during the first quarter of 2010, compared with $136 million in the first three months of 2010, or a gain of 1.8 percent. TVG is owned by the British-based betting-exchange operator Betfair.

In total, horse racing account-wagering operators with hubs in Oregon had total handle of $395.2 million in the first quarter of 2011, compared with total handle of $420.2 million in the first quarter of 2010, a decline of 5.9 percent.