Betfair to do fixed odds betting sportsbook

[Iron]

Does that mean that it would be like betting at Hills or Ladbrokes, ie you pick a horse you fancy and back it at either SP or whatever odds the bookie are currently offering?

If so, will it run alongside the current peer-to-peer exchange model, or replace it?

This is a link to the article: http://www.bloomberg.com/news/2011-10-2 ... -says.html

Jeff

Oct. 20 (Bloomberg) -- Betfair Group Plc, the world’s biggest person-to-person online betting exchange, could increase profit by more than 50 percent with a new fixed-odds sports betting plan, according to Numis Securities.

[hgodden]

Run alongside it if I understand correctly. Like Betdaq and their '1bet' proposition.

At least part of what the 'analyst' says is rubbish though. Betfair don't dominate sports betting, they're still far smaller than the big bookies

[Iron]

Let's hope so.

I've emailed Betfair to ask for clarification.

Jeff

Run alongside it if I understand correctly.

[hgodden]

Most people who use betfair like to think of themselves as better than the herd and are more interested in the 'value' or at least the better prices that the exchange mechanism gives them. If betfair were ever to take that away and throw away their core business they'd be committing suicide so I don't think there's too much to worry about. IMo they're just adding to what they already have and trying to make more appeal to the more 'simple' punters in a similar way to what they did when they introduce the BF SP

[LeTiss]

I've emailed Betfair to ask for clarification.

Jeff

LOL you totally crack me up

You're like a dog with a bone Jeff, you would have made a good detective

[andyfuller]

Betdaq don't take on liability do they with 1bet? That is just a simplification of using the betting exchange. Bet £100 on it and £100 goes into the exchange as I understand it.

Betfair are going to offer a sports book like William Hill I believe. Bet £100 and all, non or some could go into the exchange as I understand it.

So I think it will have impact on the exchange.

[andyfuller]

If all it was doing was feeding more money into the exchange I very much doubt it would bring in the kind of profits being talked about just through potentially increased commissions.

[LeTiss]

If they run it alongside the exchange, then surely nobody will take a reduced fixed odds price when there's better available on the exchange itself?

It suggests what we've been thinking for a while, Betfair want to get rid of the layers!

It means there won't be a PC charge with fixed odds. They would be competing against other bookies, so wouldn't have charges. They would just close successful punters instead, like the bookmakers do

[Iron]

Possibly, but if a horse were available at (say) 6.0 with Betfair The Bookie and 7.4 on Betfair The Exchange, people would say 'You're having a larf, mate!' to Betfair The Bookie!

So the only way they'll make it work IMHO is if they:

A. Offer much better prices than Hills, Ladbrokes, etc, possibly by laying Joe Punter's bets and backing slightly higher on the exchange (assuming there's sufficient liquidity).

Or

B. Do away with the exchange side of the business.

Jeff

Most people who use betfair like to think of themselves as better than the herd and are more interested in the 'value' or at least the better prices that the exchange mechanism gives them.

[Euler]

I did ask Betfair for clarification some time ago. If I can find the email and they approve I will post up their explanation. It sounded to me like you navigate to the market and when you place a bet you decide at that point if it is via the sports book or the exchange. I don't think all sports and markets will be on the sportsbook to start with.

From a strategic perspective it looks a little odd. Betfair re-invented the concept of the bookmaker, now they are taking a step backwards to the dark ages. I think it is an error. They should be pushing forward not backward. The market is already well served and a lot of these guys have a high street presence. From a strategic perspective Betfair could find themselves stuck in the middle with a brand that doesn't actually stand for anything. They could easily let somebody in the back door via a competitor with a stronger proposition. I.e. we are not a bookmaker.

They seem to have invested a lot of money in it, so if it doesn't work then it will be interesting to see their next move.

The key at the moment is who becomes their next CEO.

[Iron]

Not sure if that's meant as a compliment, but I'll take it as one! Thanks!

Jeff

LOL you totally crack me up

You're like a dog with a bone Jeff, you would have made a good detective

[Iron]

Betfair just sent me this email:

'I can confirm that Betfair will continue to offer the peer to peer betting exchange. Any 'sports book' type site that may be introduced in the future would just be another addition to the Betfair portfolio. We will not be using it to replace the exchange'.

Jeff

[Iron]

Betfair have sent me a follow-up email, which appears to imply that fixed odds betting isn't just an idea, but will definitely happen:

'I have spoken to the relevant department. Yes Betfair will continuing doing peer to peer exchange when fixed odds betting is introduced. The bet exchange will remain our main focus.'

Jeff

[andyfuller]

Not sure why you thought it was just an idea but yes it is definitely coming. It was supposed to be launched any time now originally I believe but it now seems to be April.

[hgodden]

It suggests what we've been thinking for a while, Betfair want to get rid of the layers!

It means there won't be a PC charge with fixed odds. They would be competing against other bookies, so wouldn't have charges. They would just close successful punters instead, like the bookmakers do

Why would they want to get rid of the layers? Laying is one of betfairs USP's.

I don't go allow with the idea that they want to get rid of the PC payers either. Why would they when they're making so much money out of us and we get all the risk?!

Andy, whether or not the money ends up on the exchange eventually is open to question.... but personally I can't see it taking a great deal of business away from the exchange. Just like when they introduced their own SP and we all held our breaths, it barely caused a scratch to the exchange. Hopefully it wont make too much of an impact again this time