Almost all of this focuses squarely on the tribal casinos and the power the state granted them when the casinos came around. The cliff notes version is that if the state allowed any sort of "competition" to the tribal casinos they would have a drastic change in their taxes they pay to the state. They view allowing ADW wagering as a threat, and as a result, it will not be getting anywhere soon.
I dealt with it personally, Arizona politics is a mess and the OTB systems there are miserable. Basically a couple terminals in bars or restaurants, no one has a clue about anything going on.
Funny thing is, phone wagering is very costly to the track based on who the provider is. My guess is they are losing money with the venture. Imagine, each phone call costing something like $1.60, with no minimum for a wager and I doubt they would have the foresight to seek volume breaks.
So, a customer would have to place a $20 bet at a minimum each time they called just to basically break even.