Q & A: Andrew Macdonald, Woodbine Entertainment Group

Woodbine Entertainment Group, which in June 2001 changed its name from Ontario Jockey Club, said earlier this year that it would offer wagering via the Internet sometime during the next six months. IGN spoke with Andrew Macdonald, Woodbine's director of business development, about what type of Internet wagering system the company will employ and how Woodbine will work with its partners to offer online horse race wagering throughout Canada. Macdonald said Woodbine is presently reviewing the services of several different online wagering software vendors and would choose a vendor within the next few weeks.

IGN: What are you looking for in an Internet wagering platform?

Andrew Macdonald: The system we're looking for would basically be replacing our current system. Our current system for wagering over the Internet is a test that we call PC Tab, and basically what it is, is we've been operating telephone account betting for several years now with an automated IVR--Integrated Voice Response system--whereby the system listens to touch tones, and that's how you place your bet, fully automated. So the PC Tab we've been beta testing, customers using it do all their selections over the Internet. They select the track they want, the runner they want, the wager type and the bet amount, and they submit it. That goes to us over the Internet. Once it gets to us, we convert it into touch tones and run it through our PC Tab system. So it's Internet front end, with telephone account betting IVR back end.

We did it that way to appease our federal regulators, the CPMA, Canadian Pari-mutuel Agency, because at the time they were not in favor of full Internet wagering, and this suitably convinced them that this was just a form of telephone account betting, which is legal. What we're now looking for is--our regulators have basically discussed the possibility with us of going to a full Internet system, so we don't have to convert it back into a telephone bet, and as a result of that, we're looking at vendors who can provide us with a full Internet solution. So you place the wager over the Internet, we accept it electronically, and there's no conversion to touch tones, which makes it a much better product, primarily because it's much quicker. You don't have to wait for it to be converted into touch tones and run through the system, so it does make placing bets a lot quicker, and it allows more services because everything is digital and electronic rather than having to go into an analog system.

IGN: Can you tell me about the regulators changing their minds? Was there a new rule passed?

AM: No, I believe it's just their interpretation of the existing regulations. I don't know exactly why they did that, but I think it's a combination of a number of things. I think it's a combination of the environment changing, more competition coming through in the U.S., obviously California, as well as other areas where they are permitting Internet wagering. As well as the fact that before, I think the Internet was just a big, scary unknown for people, and now that we've been conducting this PC Tab test for several months, they've grown more comfortable that it can be secure and is not a free-for-all whereby information is flowing insecurely.

IGN: So the beta testing has been going on for a few months?

AM: It's been going on since the summer of 2001.

IGN: How many users have tried it?

AM: We're limited to the number of users by the CPMA; because it was a test, they have limited us to no more than 250 users. And typically we're seeing about 40 active users a week.

IGN: Is it only available to Canadians?

AM: No, it's available to anyone who has a Horseplayer Interactive account. Horseplayer Interactive is our brand of services that we use to service customers away from the track and away from our off-track betting. So it's our suite of services that goes to the home or goes to anywhere else the customer chooses to bet. Horseplayer Interactive runs our telephone account betting, is heavily affiliated with our television channels, as well as Internet wagering, PC Tab, as well as any other developments we're looking at doing that way--wireless wagering, things like that.

IGN: Once you select a platform and get out of beta testing, what will the branding be for your Internet betting?

AM: It will be a Horseplayer Interactive product. The reason it's Horseplayer Interactive is that Horseplayer Interactive is used by Woodbine Entertainment for use for our customers, but we also license it to other racetracks in Canada, so rather than having them have to build the infrastructure and system that we've built, for their areas, which are often much smaller than ours, we basically license the service to them and we set up accounts on their behalf for their home market areas, and allow them to use our existing services. We currently have arrangements with all of the Maritime tracks in Canada, with a track in Saskatchewan, with most of the Ontario tracks, with a track in Alberta, so we've got most of country--or a lot of it in any case--using the service to fulfill their telephone account betting.

IGN: So once the Internet site goes up. . .

AM: That will be a service we'll offer to them as well.

IGN: So you could potentially bet on any track in Canada if all of these tracks sign up for the service?

AM: It's not so much you could bet on any track in Canada. Basically, the way Canada works is we're divided into home market areas. So, for instance, our home market area is the greater Toronto area. We could only accept telephone accounts for people who reside in the greater Toronto area. But what we've done is, for instance, the track in Windsor, their home market area is the area around Windsor, specific to certain counties. We've licensed our telephone system to them, whereby we set up accounts on their behalf, and now anybody from Windsor, and that area, could set up an account through us and the track at Windsor, and we remit the money back to Windsor that comes from those bets, minus an administration fee. So we've basically arranged partnership deals with all those areas that I talked about earlier--the Maritimes, most of Ontario, Saskatchewan and Alberta, and currently we're in the process of closing a deal with British Columbia to enter into that marketplace.

IGN: Once the Internet system is set up, will the tracks that you already have partnerships with be able to license the wagering platform from you?

AM: That's correct. As part of what we currently offer to them, we plan on also offering to them access to this Internet wagering system, and the people who already have accounts can use that same account. So with the same account, now you can place bets through the telephone and the Internet. Or through whatever other services we offer. The same accounts, you don't have to do anything different, it's just whatever method you prefer or whatever combination of methods.

IGN: Do you have a target launch date? I know you're just now looking at platforms.

AM: We don't, simply because the unknown for us is the time it will take to satisfy our regulator that requirements are being met, so until we've gone through that stage, I'd be reluctant to give a launch date, simply because that's the biggest unknown in the timetable.