Churchill Downs unveils new way to bet on horse races

Gregory A. Hall, The Courier-Journal | USATODAY

Churchill Downs Inc.'s newest gambling site looks like the kind of betting that Congress has been reluctant to allow on the Internet.

But Churchill Downs' newly launched Luckity.com is legal because it takes advantage of federal law that allows interstate gambling on horse races.

It's an attempt to attract a broader gambling audience that is less interested in horse racing, generating revenues to result in fatter racing purses and bigger payouts.

Luckity.com gamblers can bet their lucky number or have the game choose a number for them. But rather than spinning wheels, horses in races running live somewhere around the world determine a winning bet.

Luckity players can see the location of the race and the names and odds of the horses if they want — though not the video. But the game is more aimed at the gambler who couldn't be bothered by the difference between a filly and a mare. For instance, gamblers who pick numbers for the Luckity Fast 2 don't know — unless they want to — that they're placing an exacta bet on the Tuesday opener at Beulah Park near Columbus, Ohio.

Because of the reliance on live horse racing, the game is still a far cry from an online slot machine with instantaneous results. Minutes can go before the next race starts. And finding out if you're a winner still requires the time it takes to declare a race official. Payouts can vary greatly, since they're based on the pari-mutuel pool.

The target demographic is women over

35 who enjoy slots, the lottery and social networking games, said Ted Gay, president of the newly created Churchill Downs Interactive subsidiary. Gay said the Luckity target customer is more likely to attend night racing and bet casually on their favorite names or jockeys.

"Luckity is really designed with those fans in mind," he said, "and with an effort to bring other fans like that to racing."

Gay declined to specify the amount invested in Luckity or discuss revenue projections. Bu

t he said horse owners and true horse bettors stand to see bigger purses and payouts as more money goes into the betting pool.

"You applaud them for thinking of new things," said Marty Maline, executive director of the Kentucky Horsemen's Benevolent and Protective Association that includes owners and trainers.

But Maline said it remains to be seen whether this effort by Churchill pays off commercially.

"Nobody really understands it fully," he said. "I don't know that they understand it fully," in terms of how it will impact business.

Overnights and early weekdays will be slower for Luckity because of the limited number of races available. Weekends will be the peak time, as more races run domestically and internationally.

The site, which offers 24 cash games, with more planned, attempts to reduce pari-mutuel wagering to simpler terms.For example, Luckity refers to its games as "pool wagering." Different names are given for games and wagers, which are categorized to give players an idea of whether they're betting on something — like a single-race win, place or show bet — where they'll know the outcome fairly quickly.

Churchill Downs introduces Luckity - a new way to wager Ted Gay, President of Churchill Downs Interactive, describes a new online site called Luckity

As an example, Bubble Pop requires players to pop three numbered bubbles in what is traditionally known as a trifecta, where bettors have to pick the first three finishers in order.

Payouts are whatever is paid at the track. Those who play a game tied to the Pick 6 — picking the winner of six races in a series — could see larger payouts.The site also has a free bingo game that offers "clovers" to winners that can be entered in a weekly drawing for $250. That bingo game can be a diversion for players in down times when there aren't many live races going on, Gay said.

He declined to elaborate because he said he is unfamiliar with the site."But I must make the point that somehow the horse racing industry is doing everything they can to create new gambling scenarios that have less and less to do with the magnificent sport of horse racing," he said. Gay said the game has been in developmen director of the Family Foundation of Kentucky, which opposes expanded gambling, said he has concerns about how the convenience of gambling from a website could lead to increased social costs because of problem gambling.

Luckity benefits from some of the more than $200 million Churchill invested in its TwinSpires.com online pari-mutuel betting site.t for about a year and has been undergoing tests for weeks.

While appealing to slots players, the computer games do not directly resemble a traditional slot machine, like the Instant Racing game — which allows bettors to make wagers on old horse races — in use at Kentucky Downs in Franklin, Ky., Ellis Park in Henderson and in Arkansas.

Asked whether Luckity goes after the same market by repackaging horse racing, Gay said Luckity is closer in approach to TwinSpires.com, because Luckity takes wagers online on live horse races and will be available through mobile devices.Churchill Chairman and CEO Bob Evans has dropped hints about the game, including at the company's annual meeting in June. It also was advertised on at least one infield toteboard at the company's Central Avenue track on Kentucky Derby day.Whether specific Luckity games will target the Derby and its unique — for American racing — 20-horse fields that offer the chance of large payouts remains to be seen, Gay said.

By tying the bet to a live race, Churchill officials are using the same federal law that allows traditional interstate horse race wagering, something the horse industry has closely protected for fear of losing the exemption that is a key to its simulcasting and online business.

Churchill officials said Luckity is simply a new form of advance-deposit account wagering on live racing.Churchill's top lobbyist, Senior Vice President Brett Hale, didn't express concern that the act might be altered because of Churchill's use of the horse racing law for customers who aren't necessarily seeking to bet on horses.

"We changed the interface, but it's essentially the same back end," Hale said. "I think an objective person looking at this will understand that it is exactly the same thing as online wagering and on horse racing."

Company officials said Luckity is not directly related to its hopes to participate in an online

poker business, if states or Congress pass legislation making it clearly legal.

Horse racing benefits from a federal law allowing interstate wagering, while other forms of online gambling lack clear federal authority.

While Luckity is not directly part of Churchill's push for online poker, spokeswoman Courtney Yopp Norris said the investment in the wagering platform used by Luckity and TwinSpires would be used to help Churchill compete with legalized internet gambling.