Daily Archives: April 1, 2008

Meet Jeffrey Ma (at right on the photo), the ProTrade co-founder, and whose gambling life is the basis of the upcoming movie, 21.

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No GravatarJeffrey Ma

ProTrade

(Justin Wolfers was a ProTrade adviser at inception, but his name was later removed from their website.)

Previously: The Jock Exchange: Wall Street is about to launch a new way to trade professional athletes the way you trade stocks.

Previous blog posts by Chris F. Masse:

  • “We’ll be eight degrees hotter in 30 or 40 years and basically none of the crops will grow.” “Most of the people will have died and the rest of us will be cannibals,” said Turner, 69. “Civilization will have broken down. The few people left will be living in a failed state —like Somalia or Sudan— and living conditions will be intolerable.”
  • QUESTION TO THE READERS: Could anyone guess what Nassim Nicholas Taleb would think of the prediction markets?
  • YouTube Videos on Prediction Markets
  • The Prime Minister of Ireland has just said he will resign, but neither InTrade nor BetFair would give the first fig.
  • How have Jason Ruspini’s tax futures markets at InTrade-TradeSports fared, so far?

APRIL FOOLS DAY: This year, again, CNET makes fun of the wisdom of crowds.

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No GravatarCNET: Edit wars come to spy agencies&#8217- Intellipedia.

Intellipedia

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The full listing of all the April Fool&#8217-s Day jokes&#8230-

Previously: The 2007 CNET joke&#8230-

Previously: The 2008 Midas Oracle joke&#8230-

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Previous blog posts by Chris F. Masse:

  • Thanks to enterprise prediction markets, senior management can move faster to deal with problems or exploit opportunities.
  • NOTE TO SELF: Set up customized e-mail alerts for brand-new, hot Midas Oracle stuff.
  • DAYS OF RECKONING, PART TWO: Matt Drudge features the prediction markets. + Reuters has the right terminology (“traders”, “prediction exchanges”) but ignores BetFair.
  • DAYS OF RECKONING: The New York Times is telling the business world that enterprise prediction markets are an essential management tool.
  • HubDub will soon distribute a continuously-updating chart widget displaying the state of their prediction markets.

Independent production company seeks deep throats to spill beans on online poker industry and BetFair Poker.

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No GravatarBetting Market:

I am a researcher employed by a leading award winning UK based independent production company, that specialises in factual programmes. We are currently researching the online poker industry, for a forthcoming documentary that will look at the broader issue of the regulation of the online gambling industry.

I am interested in hearing from people who were or are involved in any disputes with their online poker provider. I would be particularly interested to hear from persons involved in the recent incidents at Absolute Poker and Ultimatebet. And I am keen to track down anybody with inside information relating to the recent Betfair heist (not least the player who goes under the name &#8220-Chillindude&#8221-).

All information received will be treated in the strictest confidence and anonymity will be afforded to anybody that wishes to appear in the programme, but does not wish their identity to be known.

In the first instance, please contact me at the address below, so that we can arrange a meeting.

Email: pbenckendorf (at) web.de

Previous blog posts by Chris F. Masse:

  • REBUTTAL: SalesForce, StarBucks and Dell demonstrate that enterprise prediction markets as intra-corporation communication tools (as opposed to forecasting tools) are overhyped by the prediction market software vendors and a little clique of uncritical courtisans.
  • Comments are often more interesting than the post that ignited them.
  • Harvard fella says prediction markets are doomed.
  • How should prediction market firms (e.g., InTrade-TradeSports, BetFair-TradeFair) deal with Blogosphere’s criticism?
  • BetFair’s future bet-matching logic
  • If Midas Oracle were to meet, would we use Huddle, and why?
  • WORLD’S SUCH A SMALL PLACE: Smarkets meet HubDub.

BetFair Australias spin doctor tells all about their payments to the horse race industry.

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Crikey:

Andrew Twaits, director of corporate and business affairs at Betfair [Australia], writes:

Re. &#8220-High Court shock for the racing industry&#8221- (28 March, item 20). I wanted to drop you a note to clarify some important facts following your article in the Crikey newsletter.

Towards the end of your article you said, &#8220-&#8230-Betfair have offered to pay a fee of 27 cents out of every $100 bet. The TAB currently pays a fee of $5 in every $100 wagered!&#8221- Both those statements are false.

First, Betfair offered Racing NSW a product fee based on a percentage of gross profits- not turnover. We have never offered to pay Racing NSW (or any other racing body in Australia) a percentage of our turnover.

Second, the TAB does not pay NSW Racing or the NSW Government as a percentage of its turnover. It makes its payments as a percentage of its revenue – just like Betfair has proposed. See the Betting Tax Act (NSW) 2001 to see exactly how the TAB is taxed. The requirement to pay product fees to racing based on revenue is found in the Racing Distribution Agreement between the TAB and the industry – not surprisingly, we don’t have a copy but the payment model is referred to in Figure 20 of the Wagering Industry Review Issues Paper published last week by Alan Cameron AM. You can read a copy here.

To understand the practical difference between the TAB paying a percentage of turnover vs. a percentage of gross profits, you need only consider how much money goes to the racing industry or government when the TAB runs a zero take-out promotion such as &#8220-Fat Quaddies&#8221-. The result is that it doesn’t matter whether they &#8220-turn over&#8221- $100,000 or $10 million&#8221-, the industry and government receives nothing – because the TAB makes no revenue. That’s not a criticism of the TAB, they do it to get their aggregate takeout rates below the statutory threshold, and the promotions are great for racing, but it does highlight the false nature of the conventional wisdom that the TAB pays on turnover.

In relation to our offer to Racing NSW, its worth pointing out that Racing NSW has declined to tell anyone what they believe we or any other interstate wagering operator – including bookmakers and TABs – should be paying for the &#8220-right&#8221- to cover NSW racing. Nor will they say publicly whether they think that any interstate wagering operators who do pay a fee should be able to advertise, as the local operators can do.

As a final point, before we were licensed in Australia, we offered to pay every State racing body 20% of our gross revenue (from our global customer-base related to betting on their races. That offer was rejected and discussions were cut off. We accrued product fees for the racing bodies at that rate the entire time we were licensed and we still hold them in trust. To date, only Tasmanian Racing and RVL have accepted the accrued product fees.

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UPDATE: Deeper analysis by Bill Saunders&#8230-