Excellent analysis from the “-Punt”- blogger.
Serial bet winners are accused (that’-s the word) to withdraw money from the BetFair machine, compelling BetFair to attract new money from newbies at a high marketing cost, and thus BetFair has decided to tax those serial bet winners.
I wonder what a Harvard or Wharton MBA would think of this reasoning.
It is my understanding that, in the betting and gambling business, you are always trying to attract new blood to make up for the disillusioned gamblers that you are losing on a daily basis.
Am I correct, folks?
Why don’-t BetFair raise moderately the trading fees for everybody, or try to reduce the cost of the BetFair IT architecture by slashing out what has been unnecessary added by their IT maniacs?
Previously: BetFair impose new “Premium Charges”, and their very active traders are up in arms. – 2008-09-09
This kind of sums it up.
Feck N. Eejit
26 Sep 10:39
Betfair should have been looking to stop insiders, spoofers, trappers, hooverers, overround bots, fast pic boys and shell and pea merchants from using fairly simple edges to take money out of the pot for ever. Instead the prison guards just want a bigger cut of that action.
Feck N. Eejit
27 Sep 10:24
The hra = horse racing regulatory authority = the body that slaps the wrists of those cheats who are too obvious.
The bha = British horse racing authority = the outfit that oversees British horse racing, who think inside information is “the lifeblood of the sport” and who are complicit in the selective watering of racecourses so that betting on horse racing becomes a lottery which helps their bookmaker funded levy.
Betfair = a business that allows shysters to fleece their customers for a share of shyster profits. They say they need this money in order to find more clients for the shysters to replace the ones the shysters sickened off the site.
Feck is someone who has bet horses all his life. Too succesful for any bookie to keep his account open.
Betfair should have saved him, but a large chunk of his profits goes to the insiders. He doesn’t bet in-running.
He’s saying the bookies offer better value, unfortunately they won’t allow him to bet.
That’s where we are today, a positional player with superior knowledge who can’t make it work. Great industry, isn’t it ?
That guy just wants everybody to play HIS game. He`s living in the past and is just not competitive any more. The days of just him against the bookie are gone, it`s now him against 1000+ other players that are just better than him at playing these new games.
Exchanges offer a free market and everybody plays by different sets of rules whatever they maybe. Complaining about somebody with faster pictures or spotting an overround is just throwing your rattle out of the pram.
Of course, Barry. Anyone who favors a level playing field should have his head examined.
It’s also perfectly legit for betfair to exploit and profit from this, in the short term.
Why would you care if that means betfair runs a business that’s unsustainable in the long run.
Increasing shareholder value in the short term, and worry about a collapse later is something the average citizen is quite comfortable with, these days.
Betfair is a business, not a service. It does exist to make money in whatever way they percieve is profitable for them. Providing a means as an Exchange is secondary. They could go bust next week or turn in to a bookmaker, but either way they owe us nothing.
In an exchange in the true peer to peer definition, I do favour a level playing field and that`s the level that is available to everybody, I.E for Inrunning horses it would be on the course near the finishing line, to bet at home is deliberately betting with a handicap.
You’re right about one thing. Not everything that goes wrong is betfair’s fault. They didn’t choose to have a monopoly, they didn’t choose to become complacent – it just happens.
The Gambling Commission is just as much to blame. Evidently their main objectives are not just there to protect the consumer, but to protect companies like betfair from themselves as well. That’s what regulation is about. As it is, in-running and the associated negatives like bad PR, legal costs, bad decisions etc. are killing betfair. There was no need for that to happen, but I can live with it.
Al Capone ran a business too. Despite trying hard for years, all the Feds could get him for was Tax Evasion!
That doesn’t mean that scams such as numbers rackets and dealing dope are to be tolerated.
Barry, your understanding of what is fair and appropriate in a betting exchange is quite incredible. If you attempted those arguments – even with the British Gambling Commission (visibly tolerant of grey areas) – you’d be de-licenced. Fast.
Yes, THAT Adonis
If your mentioning Capone, as you saying something about the Exchanges are Illegal?
I realize now that question might not be the best one to answer
On the original topic, there is the transaction charges that were introduced to recover funds from those heavier users.
Plus seems something is hitting an exchange forum regarding the PC allowance. It should be quite quiet with a lot of vocal users unable to post.
Barry, maybe this will be helpful.
“The requirement… is one of fair and open dealing. Openness requires that
the terms should be expressed fully, clearly and legibly, containing no
concealed pitfalls or traps. Appropriate prominence should be given to terms
which might operate disadvantageously to the customer. Fair dealing
requires that a supplier should not, whether deliberately or unconsciously,
take advantage of the consumer’s necessity, indigence, lack of experience,
unfamiliarity with the subject matter of the contract, weak bargaining
position or any other factor listed in or analogous to those listed in Schedule
2 of the regulations. Good faith in this context is not an artificial or technical
concept; nor, since Lord Mansfield was its champion, is it a concept wholly
unfamiliar to British lawyers. It looks to good standards of commercial
morality and practice.
I wouldn’t say betfair have always lived up to good standards of commercial morality. Even today, when the average customer hasn’t got a clue how much betfair is charging them, and how much they are extracting with their cross-matching algorithm. I’m sorry to say that the average gambler is an easy victim, especially in an unregulated environment. The media don’t care either, because one shouldn’t gamble in the first place. It’s a rotten industry, we all know that, and so the circle is round.
It is the Gambling Commission’s job to make this work. To professionalize the gambling industry, especially P2P-betting as far as I’m concerned, because this will attract the entire investing community in the long run.
They have failed, and we should now break them. Or retreat, and let it be. I haven’t made my mind up yet.
Congratulations! You’ve had a winning week on Betfair. And like 98% of your fellow winners out there, you won’t be paying any Premium Charge; and by our estimation, you never will.
There’s been a lot of misinformation in the press and chatrooms about the new charge, so we just wanted to assure you of this after your successful week and to share some information with you.
The charge will only affect customers who, in the long-term, generate very little commission compared to the amount they win. Those customers pay less as a proportion of the funds they remove from the exchange than we spend bringing those funds to the exchange in the first place. This behavior is unsustainable for the long-term health of the exchange and not in the interests of customers, like you, already contributing their fair share.
We don’t want to limit any customer winning because that’s not what we’re about – we are just asking a few to contribute a little more, so that we can continue to grow the exchange for everyone’s benefit.
In its first week, the Premium Charge is being paid by fewer than 500 customers. During this period, we had more than 110,000 people punting on the exchange, so, fewer than 0.5% of our customers fell into the new charge category.
Betfair’s liquidity continues to be excellent. For example, the volumes traded in our football markets, last week, were the third best ever, surpassed only by the final weeks of Euro 2008 and the World Cup.
Many thanks for your support and we hope you continue to be a winner with Betfair.
The Betfair Team
I hope the press is reading this. Reverse countermeasure manipulative action is what is needed. You’ll be doing the average online gambler a favor, and by god he needs it.
Never a dull moment with betfair around.
RNSW and HRNSW saying “Betfair, your business model sucks!”.
What do I think ?
Betfair Customer Services
03 Oct 09:09
Betfair today issued proceedings in the Federal Court of Australia challenging the validity of decisions by Racing NSW (RNSW) and Harness Racing NSW (HRNSW) to impose a 1.5% turnover fee for all wagering operators wishing to cover NSW thoroughbred and harness races.
The proceedings in the Federal Court are brought under section 92 of the Constitution, alleging discriminatory conduct in interstate trade and commerce. Betfair succeeded in a separate section 92 action against the Western Australian government earlier this year.
Betfair’s Director, Corporate and Business Affairs, Andrew Twaits, said: “We’re happy to pay a fee to the NSW racing industry on all our wagering revenue but the turnover fee imposed by Racing NSW and Harness Racing NSW is highly discriminatory.
“The fee equates to around 60% of our gross revenue but less than 10% of TAB’s revenue. Both RNSW and HRNSW are fully aware that it’s impossible for us to compete on those terms. They’ve left us with no option but to challenge the validity of their decisions.
“The only fair basis on which to charge for race fields is to implement a gross revenue model where every wagering operator pays at the same rate. That way, even if there is any transfer of customer expenditure from the TABs to other wagering operators, the NSW racing industry will continue to get the same proportion of revenue from every dollar spent by punters.”
Things come…….and some things go:
In the beginning, people wanted to share in the success of an enterprise, so the Owners offered a share of their businesses for sale by Private Treaty. Mostly, they got paid, and the Clientele got what they paid for.
Enter the Spivs…
The Spivs used the flaws in Private Treaty trading to find ways to abstract much larger sums (for themselves) than Clients needed to pay. Because there was little knowledge about what was Fair Value, few Clients (at first) complained much.
Then they got wise….
They saw a bright spark (a truly Sharp Mind) establish a Stock Exchange which took on the responsibility of matching buyers with sellers and guaranteeing deal completion with no risk of non-payment or non-delivery of shares. The Stock Exchange’s ONLY source of income was a commission from their Clientele. They had then (and still do today) absolutely NO INTEREST in either side of the deals they matched. Such Stock Exchanges have stood the Test of Time.
Later, Some Clients wanted higher-risk, higher-reward opportunities, but also wanted to retain the security of an independent, high-integrity matchmaker/referee. They wanted to buy Options – which are extremely Time dependent. So they established Options Exchanges which became especially adept at accounting for all of the potential pitfalls connected with Time (as well as Spivs!)
In parallel with this, classical bookmakers had been plying their trade, legally or otherwise, for centuries. Although many of them conducted their business with high levels of integrity, many didn’t. And lots of their Clientele were unhappy.
A Bright Spark (sharp mind?) decided that, in exchange for a consistent (unfortunately high) commission, he could pool all wagers and ensure that winners received their “fair share” of the pool. It wasn’t the most efficient business, but attracted many Clients because (again) of the impartiality of the stakeholder/referee to the content of the Client’s bets. Called the Totalisator, or Pari Mutuel, this form of betting helped limit the prospects for spiv-styled “bookmakers”, particularly in dog and horse racing.
But the bookies survived – especially those with high standards of integrity (even if they also retained high take-out goals!)
Enter the Betting Exchange.
The original idea was that punters could offer to bet or lay in an Exchange (cf: Stock Exchange) environment, have their bets matched by an independent Referee – who would also ensure payout by being Stakeholder as well – of the highest Integrity, and potentially save huge percentages of take-out made at that Time by both Pari-Mutuel(Tote) and Bookmakers. Savings of 20% were easily and correctly envisaged. All that was required was for the Exchange to maintain its stated goals and steer clear of crossing the line between Referee and Player.
It did, for many years. Business prospered. New Clients flooded in as advertisements informed them that they too could enjoy “person-to-person” betting via a Betting Exchange. Unfortunately, a “blind eye” was turned to Spivs bent on (IMHO) fraudulent abstraction of funds via Time manipulation – especially in the domain of Prior Knowledge.
Then, the Exchange decided that it was, in fact, a Bookmaker.
If not in Law, this was EXACTLY what its Clientele believed it WASN’T!
The Exchange decided that it could “cross the line” between Referee and Player, and help itself (generally via Clock-Freezing Abstractions) to a portion of Client’s submissions TO EACH OTHER. Furthermore, it also decided NOT TO TELL it’s Clientele until AFTER it began doing that!
The snowball began rolling.
Some might say understandably.
Some might believe irreversibly.
Later still, the exchange decided that it would levy charges against Clients who won their bets (or lays) in particular ways. The charges were generally considered punitive, especially by those Clients targeted. This action spotlighted that the exchange had an interest in who won, when and why.
The snowball grew.
And that, friends, is where IMHO we are today.
We can’t be sure that exchanges will realise the simple mistake they have made in failing to stay on the “right side” of the line between Referee and Player.
My own, strongly-held opinion is that ALL exchanges which fail to pull themselves back in line with Client expectations are destined to decline rapidly and be overtaken by those that do.
To me it is logical, and obviously so.
It’s just taken a long Time for many Clients to realise that they can ALWAYS do better if forced to look for better……..
Yes, THAT Adonis…..
Too much logic in that post, Adonis. Unfortunately, the average brain can be qualified as being selective, narrow-minded, short-sighted, prejudiced and drenched in a healthy dose of false hope to keep us going. These are the physical limitations that cause our behaviour to be inefficient, eventually, in the long run. Einstein has already shown that there is more to us than meets the eye, a part physically unconnected to us. So there is hope, after all.
One of those inefficiencies is what you and I have been warning about. A troubled company, uncertainty amongst shareholders, dissatisfied customers, an industry going in the wrong direction, regulators that don’t know how to deal with this. A lose-lose situation for everyone. That includes the shitheads out there whom you are quite familiar with. Like I said, they can’t see it. There are some advantages for those who are unwilling to see. Progress isn’t one of them… And it’s a funny thing, when you think about it, that some (most) people would not choose progress. Because it’s imprinted in every living organism, body and soul. It’s an auto-function of our presence in some way, and cannot regress. It’s also the one thing that can justify our existence. The one thing that can be exploited and offers huge reward in doing so, IF you define it properly. And that… is for each and one of us to find out for ourselves.
they are asking for you, on betdaq’s forum.
Where is Adonis?
Posted Today @ 10:58:15
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The Betdaq forum would benefit if the great man shows up here.
Posted Today @ 21:32:41
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I second that!