April 6, 2017
Effective today, TOC has withdrawn consent for TwinSpires to accept ADW wagers from California residents on California Thoroughbred races. This decision was not made lightly and comes following several weeks of intensive work and negotiations between TOC and TwinSpires, as well as the other ADW companies, in an effort to help them comply with the terms of an agreement signed in December requiring the ADW companies to identify on-track ADW wagers using geo-location technology, which will provide a more equitable distribution of revenues from ADW wagers placed on track. The last thing we want to do is inconvenience the customer, which is why we have worked diligently with the ADW providers and have granted multiple extensions for compliance.
When the California account wagering (ADW) law was passed in 2001, it was never contemplated that ADWs would accept on-track ADW wagers in direct competition with live racing associations. As smartphone and tablet technology have rapidly expanded in recent years, however, all segments of the California Thoroughbred industry have recognized that something must be done to quantify the amount of “on-track ADW” taking place and to adjust the economic model to reflect the expansion of the ADWs into on-track betting. At the same time, the industry has consistently rejected any suggestions to ban on-track ADW out of respect for the players who attend live racing and wish to wager with their ADW accounts.
To address this issue, TOC reached separate agreements with TVG, XpressBet, NYRA Bets and TwinSpires in December 2016 that would require ADWs taking wagers from CA residents to geo-locate all customers when logging into their accounts for the purpose of identifying ADW wagers placed within the enclosure of racetracks on live racing days. The agreements also provided for a modification to the hub rates paid to the ADWs for on-track ADW bets such that the racetrack and horsemen would retain a larger portion of on-track ADW wagers than they receive when an ADW wager is made at a location away from the track.
This geo-location technology is readily available in today’s marketplace. Apple has long required geo-location for any wager made through an app offered at the App Store, which includes the TVG, Xpressbet and TwinSpires apps. Geo-location is also commonplace in some of the most popular smartphone applications including Uber, Google Maps, and practically all live television programming. Consequently, the main technological issue required by our agreement was to geo-locate wagers placed via web browsers or mobile web.
At the request of the ADWs, TOC agreed in December to extend the date of implementation for the geo-location system until March 15, 2017. This was designed to provide the ADWs ample time to program any required changes to their system. We are now three weeks past the March 15 deadline. Xpressbet, TVG and NYRA Bets have all made the necessary technological changes to comply with our agreement.
Unfortunately, we were informed yesterday that TwinSpires will fail to meet today’s deadline, which marked the end of a second extension granted by the TOC. In keeping with the terms of our agreement, we have notified TwinSpires that it will not be allowed to accept any ADW wagers from California residents on California hosted Thoroughbred races beginning today, April 6, 2017, until such time as it has implemented the technology necessary to fully comply with the terms of our agreement. California residents may continue to place ADW wagers on Santa Anita and Golden Gate with Xpressbet, TVG and NYRA Bets in the interim.