At the races rights deal to unravel?

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UK horse racing's £307 million (E444million) media rights deal could be in trouble as the Atheraces consortium demands compensation for lower than forecast profits or alternatively a complete renegotiation of the 10 year deal, according to the Telegraph.

Consortium members, BSkyB, Channel 4 and Arena Leisure, say the margin from their share of the Tote betting pool is falling way below expectations and this triggers a right to renegotiate in a window that opens on 22 January. The shortfall has happened as the Tote – the government controlled oncourse betting company – has cut its own margins, by cutting its take from the betting pools, in order to drum up higher volumes.

Although the 49 racecourses who struck the rights deal with Attheraces are unwilling to compensate the company, some observers believe this would be better than the alternative. The rights deal, struck at the height of the sports rights bubble, is now seen as very expensive and it may well suit Attheraces to tear up the agreement. If this happened they would doubtless claim back some of the £100 million they have already paid the courses.

Meantime, the Office of Fair Trading has already been investigating the deal in a mirror image of the EC probe into Premiership football rights, claiming the courses may have broken rules on collective selling. The OFT has agreed to stay its investigation until after any renegotiation of the contract has been resolved.