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Kevin Smith

Sky Goes Live with Virtual Horseracing

7 September 2004

A week into its launch on Sky officials with Inspired Broadcast Networks are pleased with the demand for virtual horseracing, another sign that virtual gaming is a sector of the interactive gaming industry worth watching.

Patrick Herridge, a spokesperson for IBN said that the first week of action on Sky Vegas Live, Sky's iTV entertainment and betting channel, was tremendous.

"The take up of virtual horseracing has been hugely encouraging," he said. "The horses had an influx of users in the week since going live and have proven to be a very popular service."

For IBN, which is owned by parent company Leisure Link, the Sky deal marks a new entry into the at-home entertainment and gaming market. In addition to its at-home delivery, IBN has 6,000 gaming and entertainment terminals, 4,000 fixed odds betting terminals, and 1,000 digital jukeboxes in a variety of locations throughout the UK.

Luke Alvarez, co-CEO of Inspired Broadcast Networks, said his company is slowly increasing its market share in what is becoming a highly competitive sector of the industry. He said all of IBN's units combine to make a very formidable team.

"With over 10,000 networked devices in pubs, bars, leisure venues and licensed betting offices across the country, we are by far the largest network of broadband enabled entertainment and gaming terminals in Europe," he said.

Now IBN is hoping to make similar inroads in the iTV sector.

The launch of Virtual Horse Racing (VHR) on Sky is just the fist phase of what IBN hopes is a long-term partnership with one of the UK's leading broadcasters, according to Herridge.

"This is very much the first step in the Inspired Broadcast Networks relationship with Sky," he said. Even after only a week of being in service for consumers Herridge said the early results were a sign that a "good future is forthcoming for virtual racing products."

He said upgrades to the current system, and additional virtual racing products, are planned over the next few months. Adding a virtual greyhound racing program is just one of the possible upgrades in development, according to Herridge.

The VHR was launched on Sky Vegas Live as part of the new show The Horses. The show is broadcast daily from 3:30 p.m.- 5:30 p.m. and allows viewers to bet interactively on the virtual races they are watching. The program also features live commentary from experienced racing pundits.

The system, which was developed with partner Red Vision, includes life-like graphics of horses and the track they are running on. A random number generator creates race results for the system, which can be operated 24 hours a day.

Virtual racing offerings have gained popularity in betting shops over the last few years as a way for visitors to bet when races are cancelled due to bad weather or there is downtime in between post times.

Alvarez said the original virtual racing was beamed to betting shops only a handful of times a day and now "there are more than 30 a day. It is amazing, this started as a bad weather option but the demand has been incredible."

Last year over £500 million in bets were generated through virtual racing, according to ISB, with the bookies making £100 million on the extra business.

As the popularity spread with virtual racing, so did the offerings for punters in betting shops. Bookmakers added virtual roulette and other fixed odds betting terminals in their shops.

The long-term future of FOBTs remains unclear as the UK government and various court cases have cast a shadow on the industry, but Alvarez doesn't see anything changing immediately until the government does a through analysis of the situation.

Dave Mousley, Managing Director of Red Vision, said the addition of the virtual racing product on Sky should only increase demand for the product at betting shops.

"Interactive television opens up a whole new audience for this sort of product and to be the first to launch on a Sky branded channel is a hugely exciting validation of the work we have put in," he said.

Sky Vegas is a free channel for the 7.1 million Sky Digital viewers in the UK and Ireland.

Richard Flint, Channel Head, Sky Vegas Live, said his firm is delighted with the early results from the virtual racing program.

"Now that we are live we are very pleased with the results, although this is very much the first step for our partnership and we are planning to roll out other virtual racing products over the coming months," he said.

Hill Expands Virtual Roulette Offering

Just a week after the launch on Sky officials with William Hill announced that it expects to have 5,200 virtual roulette and slot machine devices installed in its' shops by year's end.

In May the company said it would have 4,000 of the touch-screen terminals by the summer and did not "expect this number to vary significantly" by the end of the year.

The amount bet with William Hill rose 42 percent to £3.9 billion in the first six months of 2004.

Gross win at the group's 1,600 betting shops rose to £290 million - with almost one pound in four being lost through roulette and other slot machines rather than on traditional over-the-counter bets.

Finance director Tom Singer said the average operating profit from a roulette terminal was £400 a week. He insisted there was "more [growth] to come" from the new machines as William Hill sought to negotiate better terms with suppliers.

Asked about a possible regulatory clampdown on betting shop roulette, Singer echoed Alvarez feelings that no decision is imminent.

"The government will want to see the results of market research over the next two years," he said. "We are reasonably confident the situation will remain unchanged, at least for the medium term."

He noted that culture secretary Tessa Jowell, who is preparing a wide-ranging gambling bill, has made clear that virtual roulette in betting shops is "on probation."

Singer said William Hill understands Jowell's position and pointed to the group's emerging Internet and interactive television betting offerings as other potential sources of growth.

Sky Goes Live with Virtual Horseracing is republished from
Kevin Smith
Kevin Smith