If the Betfair share price bloodbath continues what will be the impact on punters?

It seems to me that the main obstacle to Betfair's future growth is governments outside the UK adopting a different attitude to that of the UK.

However, in the long run, consumerss worldwide get what they want - they go '''pirate'' if they don't.

many global punters will want a low-margin exchange platform which, in order to operate, is taxed on gross profits worldwide.

Short term we may see governments siding with local high margin operators, but lnog term they'll find their citizens won't wear that.

Betfair as a product will be ok in the long run.

Yes, looking in more detail, I must admit, I though this was one of the worst excuses for falling revenue from a finance director I have ever read - and there have been some feeble excuses used by companies over the years:

"Average spending per punter fell sharply on both poker and horse racing...On horse racing it blamed lower average stakes by punters, which it said not only reflected the recessionary background to consumer spending, but less interest in the flat racing season.

Finance director Stephen Morana said: “The flat season is suffering as it loses more and more good horses to stud as soon as they've won as three-year-olds.

“The jump season has been hit by the weather, which doesn't just mean an immediate loss of revenue but also means punters have less form to go on and just get bored.”

Sure, horses being retired to stud is a sadness, but do you know many punters who have left the betting shop or hit the withdraw button for this reason?

Escapee  heres a bit of advice from an old  boy . your market maker  would  strangle his  grand mother  for a profit .

it may mean in a roundabout way that betfair NOT offering their customers any shares in the ipo was after all some recognition of their loyalty.

As for the average spending per punter sharply falling, I can only only comment on my own experience in that my spending has fallen in some ways due to the lack of punters wishing to bet against me. A sort of downward spiral that needs addressing (if the backer spends less then so will the layer and visa versa). 

Also fresh talk of requests that betfair punters should pay the horse race levy is not helping confidence.

hazel said: 
A sort of downward spiral that needs addressing (if the backer spends less then so will the layer and visa versa).

A downward spiral which was initiated by the Premium Charge, imo.

anyone who views the forum would never consider investing in shares would they? nearly every one would jump ship straight away if there was a good alternative and its only a matter of time ...

I've said it all along, the Premium Charge will get them in the end. If America do open it's markets to exchange betting do Betfair honestly think the Americans will sit back and invite them in. No chance, they'll bring a bigger and better and fairer exchange out, and most of us will defect.

Betfair could lose every pc payer tomorrow and, apart from the flies-round-sh1te ir markets, no one would notice any difference. The idea that any existing or future exchange will be salivating at the thought of attracting a group of ponces who'll be willing to give them back 5p for every £1 they take out of the pot is so delusional it belongs in the city.

15 to 9's expected.  Any initial offering comes with the hype.  Over the past year...two....possibly three there have been very few "anticipated" floats and betfair was in the media monthly leading up.

Reading through the thread, alot of points that make betfair a positive for a portfolio.  The expansion world-wide is, as pointed out, heavily reliant on legislation, making the deal then, of course, convincing the public (thus the barrage of 'billboards' on the home page with price comparisons, etc). 

As the Canadian who moved here in 2001, the perception of gambling in North America is totally different than in the UK and Europe.  The word 'flutter' doesn't exist and though addiction affects people world-wide, in the states it isn't a matter of losing your grocery money but more on a level of losing cars, jobs and homes.  As well, 'trading' is still perceived as some sort of world that the "common punter" can't get involved with.  All challenges for the marketing and 'education' team.

But at what price for the shares; still not sure myself though a mate of mine who works in financials in Canada put them at $12/$13 U.S. when I had him look at it.

Then, from there, it is, well, a gamble on what territory can bring betfair mighty returns.

Racingcert
Can't believe this

Finance director Stephen Morana said: “The flat season is suffering as it loses more and more good horses to stud as soon as they've won as three-year-olds.


Understandable comment when you factor in that BF is now not run by racing people or even betting people but by IT and financial people.

DFCIRONMAN, it's not a criminal offense ( nor even a criminal offence )
to discuss 99.999999% of things on an internet forum.

And betfair's shares do not fall into the 0.000001% of things you can not talk about (in the UK at least)


Personally I only glanced at the initial float info but i thought I dicerned from it that betfair were speding £330m on re-architecture ( what ever that means ) over three years and this was effectively making their bottom line operating profit look a lot smaller. Thats a lot of money to invest.... and for what purpose ?

If they drop to £5 or £6 then I would double check my initial findings and probably rate them a bargian if found to be correct.

its waay tooooooo risky

people know how fast things can change on the web

I often wondered how many Betfair users read this forum - now, thanks to the new interface for it, I know - not many!

And most of those are, I suspect, lnog-term winners with agendas.

The Premium Charge is the LEAST of Betfair's woes - it targets people who won't leave the site while there's a penny to be made here.

The vast majority are unaffected by it and enver give it a second's thought.

I'd say Betfair's real problems are that UK horseracing, on which it was built as a business, has plateaued out, and illiberal governments outside the UK are making it hard to grow the business to justify its valuation.


It's unreal problems are the overwhleming negative sentiment at present, which could easuly drive the share price down to a fiver, especially as quoted prices are often based on thin trading, with few shares actually available at any given time,

Nearly everyone associated with Betfair has made a nice few qyid on the back of the Softbank buy-in and the initial float at overalued prices - worst case scenario is those who still hold shares mgiht not end up quite as rich as they expected.

But this company has still done well and, i think, can do so in the future.

I'm a great believer the public gets what it wants in the end and, though not all punters want betting echanges, enough will do in various targets companies to get Betfair in there eventually.

NoMark, the thought that any of the masters of the universe in the city could operate with a hidden queue is deserving of your smilie.

PS Stop crawling to the large forum city boy presence.

Some fatcs on Betfair and why it share price can't go belowe

Betfair has £170 million in cash and no debt...with 107 million shares that £1.58 of betfair share price in cash..this money has to be spent or given back to the share holders at some point

so for £3..50 per share your getting

Betfair is already in USA..TVG had a 2009 horse betting turnover of $550 million USD and revenue of $50 million USD...TVG is like a TAB..TVG H1 2010 turnover up by 20% and revenue up 13%...betfair has already got California and New Jersey to pass laws to let betting exchange and more states are very likely to pass law to...TVG will pay most of the coststart up cost of betfair USA and the cost geting the  USA states to change the law.. at the same time as betfair growing TVG business and profits

LMAX (75% betfair) Many analysis who say betfair should be trading at £5 say that LMAX will not be able to do to the CFD markets as betfair did to the bookmakers , that IG group and CMC markets will act to cut there marging and speads prices, and those margins are already tight..IG Group makes 50% profit on revenue CMC markets not far off that to, there is lot of room for a prices war and still make profits..where LMAX will only fall is if LMAX can not get the liquidity but after 1 month LMAX has the liquidity on major index and Forex...LMAX as of now is about 1/10 of the cost of IG markets..If i was to short sell any stock, it world be IG group, 50% profit on revenue is going be cut big time

Betfiar betting exchange ,  betfair says it would cost £300 million to make a betting exchange like betfair...

There to much cash and asset value in betfair for betfair to be prices just on a P/E only

Betfiar betting exchange ,  betfair says it would cost £300 million to make a betting exchange like betfair...

LOL. It would cost 10 to 20M for the software, and somewhat more for back office and operational stuff.

'Re-architecting' means scrapping most of their software and IT investment to date.

So it going to cost BF 300M to make a betting exchange like betfair. Double LOL.

I don't know anything about what true cost is  , but that what betfair said in report...that it would cost $300 m to bulid a Exchange like betfair..

What I do know is, that being a betfair PC payer, i'am wanting and hoping another betting exchange will come along and push betfair in price and liquidity..if it only cost 30m , why hasn't anyone done it yet?

betfair take so much less risk then other bookmaker/CFD company, and I think we see this in betfair stopping there high roller in Q1 ..betfair had £24,7m revenue, £6.4 EBITDA, and betfair f-cking stop it...Ladrbokes live and dies on there High roller winning or losing

I don't know anything about what true cost is  , but that what betfair said in report...that it would cost $300 m to bulid a Exchange like betfair..

If I have time later this week, I'll post a job on freelancer.com and see if someone in the east can knock one out in twenty days

How many people are going to use an exchange that is even more complicated for the casual punter to get his head around than Betfair ? Invisible bets? Who's going to understand that ? It is an interesting idea but I've never seen you describe how it would work in much detail.