The biggest horse race of the year is nearly here again, but residents of Canada’s most populous province still won’t see any wagering markets on their usual sports betting sites.
Indeed, Ontario sports betting is now offered by more than 30 regulated sites in the province. However, none of them offer wagering on horse racing, and none of them will have markets for Saturday’s Kentucky Derby.
The reason for the horse-racing scarcity has to do with the rules for legal sports betting in Canada.
While provinces can authorize wagering on most sports, horse racing is not one of them. The only legal form of betting on horse racing in Canada is via the pooled, pari-mutuel model that is overseen at the federal level of government. The sport was also exempted from federal legislation passed in 2021 that legalized single-event wagering throughout the country.
As a result, operators in Ontario’s competitive market for internet gambling (which launched in April 2022) can’t take action on horse races. Some operators did but then dropped the sport once they entered the province's regulated market.
So where CAN you bet the Derby?
The only entities that can legally take bets on horse racing in Ontario (and, therefore, for this year's Derby) are connected to Toronto-based racetrack operator Woodbine Entertainment Group, such as its two digital platforms, HPIbet and Dark Horse Bets. Woodbine is the only holder of a federal pari-mutuel betting license in Ontario, which allows it to offer wagering on horse racing online, at the track, and at OTBs.
All of the above is no different than last year’s Derby. However, there is hope things will change before the end of 2023, as Woodbine wants to integrate its wagering capabilities with the legion of apps and sites that have started doing business in its backyard.
“We've made a lot of progress,” Michael Copeland, president of commercial operations for Woodbine, told Covers in an interview this week. “Our hope and expectation is that we're able to go live before the fall, and, right now, we’re cautiously optimistic that we’ll be able to do that.”
Woodbine envisions a setup wherein the Ontario-based customers of well-known sports betting sites, such as DraftKings or FanDuel, can access horse-racing content using those sites. However, while a bettor could log on to and use the platform of a sportsbook operator, any wagering on horse racing would flow through Woodbine’s systems behind the scenes.
Updated Kentucky Derby Post Positions pic.twitter.com/PSIaS7KnoT
— Kentucky Derby (@KentuckyDerby) May 4, 2023
This arrangement would provide sportsbook operators with additional betting markets in Ontario and introduce or reintroduce users to gambling on horse races, potentially giving Woodbine a new source of horseplayers. That would help the horse-racing industry overall, which relies on funding provided by pari-mutuel wagering and competes with sportsbooks for the attention and money of gamblers.
The numbers from the first year of Ontario's iGaming market also provide a good reason for Woodbine's interest in joining the fray. The first-of-its-kind market for Canada saw $35.5 billion wagered and $1.4 billion in revenue generated by more than 40 operators.
Woodbine already has one partner lined up for its back-end services, but the company, which acts like a not-for-profit and supports the horse-racing industry, is not naming names yet. Woodbine has had talks with several operators, Copeland said.
“It would be widely distributed across the industry,” he added. “If we weren't able to integrate and be offered alongside the other sports within sportsbooks, I think it would be extremely dire for the racing industry because I think that will ultimately be the platform of choice for sports bettors and horseplayers to make bets.”
A big day
Copeland also said that the technical work needed to make Woodbine's systems compatible with online sportsbooks is essentially done now (albeit it was perhaps a bit more work than anticipated) and that the company has had encouraging conversations with government agencies, such as iGaming Ontario. Once regulators finish their testing and are satisfied the setup is sound and will not violate any existing gaming rules, the wagering can begin.
Unfortunately, the wagering will not begin in time for this year’s Kentucky Derby, which is a huge day for horse racing and Woodbine. Although iGaming operators in Ontario are probably hearing from customers who want to wager on the 149th Run for the Roses, they'll have to wait for now.
“It's the biggest day of the year, in fact, because the eyes of certainly North America, but the world, are really on racing,” Copeland said. “And that generates interest not only in the Derby itself, which we offer to our customers, but all the surrounding racing.”
