General Betting
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http://www.guardian.co.uk/business/2011/may/22/betfair-crisis-directors-quit-shares-slump
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Chickens coming home to roost?
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Hence the advert on here.
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she added: "Like any good employer we want to hear everyone's views on how we can keep getting better."
In large part, their problem is they don't. I've made suggestions on how bf can be improved and what I got for my efforts is a p off and don't bother us response. |
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"We are a growing business and in the past 12 months our headcount has grown by more than 20%"
The spokeswoman says the above like it is a good thing. The source close to the company says "for a long time the company has been running hard to stand still" The second statement is probably nearer the truth. |
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Mind you, in an organisation where you have a "vice-president of global user experience" it's no wonder your headcount is rising rapidly for no increase in the bottom line if those are the fluffy roles that need departments to maintain
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What is Betfairs strategy to grow the business ? The bottom line is growing due to the 20% "premium charge" that is imposed on winning customers.
Horse Racing is alive and well for the 50 or so regular track players and the crumbs left on the table for the rest are getting smaller. When you explain to friends that you can play Horse racing in running from SiS pictures but you are 50yards behind live then they can draw their own conclusions. If they manage to still compete without getting access to the racetracks (the secret society) and are succesful then they could be subject to a 20% deduction on Wednesday afternoons ! What a sales pitch - please register now ! |
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10 reasons why BF has problems:
1. It's become top-heavy with non-jobs 2. It's cost base has risen too sharply 3. It is an IT focussed company not a company that is in tune with punters 4. It has lost its identity as a company offering a better alternative to bookmakers 5. There may be sound reasons for the PC but the fact is that it says "winners will be taxed" and all would-be winners have lost the illusion that winning is possible 6. The move into games of pure chance has ruined its reputation as a company not intent on just milking soft-headed punters 7. Overseas expansions has met with a lot of resostance 8. It has not thrown off the accusation that being able to lay losers encourages corruption 9. It has lost the inspiration of the founder and is run by people with no apparent vision 10 BM's are no longer concerned with BF as a threat but as an opportunity and can now manipulate prices to their heart's content I'm sure there are other reasons too |
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Posted this on the Chit Chat thread. Would be interested in comments on here:
Betfair must p1ss themselves with laughter at threads blaming the Premium Charge. The Premium Charge is irrelevant: hardly anyone pays it and those that do can by definition afford to keep paying it. Meanwhile not a squeak is heard about the real scandal and the reason for the halt to Betfair's growth: the devastating level of commission paid by every single user. Suppose you are a pretty average user, and you find yourself with a 20% discount on commission. So you're paying commission of 4%. At the end of 12 months of hard punting, your bottom line says your profit/loss is exactly zero. Not much of an encouragement to continue, but do you know how much commission you paid to Betfair during those 12 months? The answer is over £6,000. So you are, in fact, a shrewdie, consistently beating the market, backing more than your fair share of winners. And Betfair has taken every single penny of your winnings. Why carry on? And it's even worse if you are one of the losing punters. A punter on 4% who loses £6,000 in a year from their matched bets alone will actually end up £12,000 down. You just have to stop. And that's why Betfair has ground to a halt. They have bled their customers dry. |
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Spot on screaming although the reality is even worse. The pc payers, who are on the best deal, are in many cases being assisted by betfair to defraud the very people who are paying the most.
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Betfair, the embattled betting exchange, has been rocked by a fresh crisis following a wave of middle-management departures. The defections come as the company digests the results of a private poll of staff revealing that employees believe their company lacks direction
This is actually quite heartening. I always assumed they were just a bunch of nice-but-dim ex-city w@nks that all agreed the tumbleweed early horse markets were a completely natural phenomenon. |
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I think it's mebbe a company in love with its own diversity and complex range of products, which is racking up it's costs, and losing the company focus, control and direction.
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It made itself what it is because it's core product was a huge breakthrough. It's still a great product.
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"The Premium Charge is irrelevant: hardly anyone pays it and those that do can by definition afford to keep paying it"
What a complete pile of rubbish. You are saying that only people winning big sums pay it? Utterly laughable comment. Long term losers could have easily paid it prior to that. Small winners making tiny amounts can pay it. Etc, etc. Charge everyone a flat 5% rate per market, job done. Everyone competes on a level fair playing field, and gets treated identically, not certain people being cheated at simply because of the random order of their wins and losses. |
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Feck N. Eejit
Spot on screaming although the reality is even worse. The pc payers, who are on the best deal, are in many cases being assisted by betfair to defraud the very people who are paying the most. Not sure which group you are referring to but the reality is that the pc payers, crooks aside, have their winnings stolen before they have a chance to lose them. At least you get to 'have another go' at it feck. The worst thing is that pc payments paid can technically become out of date or non-applicable, once a winning run turns into a losing one. I thought this was supposed to be a long-term game? |
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hardly anyone pays it and those that do can by definition afford to keep paying it.
Wrong on both counts. It baffles me how some people think that the PC only affects big players and does show a lack of understanding on who is being targeted. This example would still qualify for the Premium Charge: Weekly commission rate of 5% Weekly total winnings of £500 (after commission) minus weekly total losses of £250 = £250 net profit This profit of £250 at the end of the week would then be deducted with the PC (in this case about (£37). *above example takes for granted that you comply with 250 markets, account in credit, allowance used up etc. |
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20% increase in staff for the last 12 months?
wtff? |
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They cd not push ahead w/ their core product b/c of regulatory resistance so they broadened their focus and lost their way.
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Almost all bf's thoughtful winning players (and some losing players) cd tell them where they are going wrong. But the mentality of some of those at the top seems to be very techy and distrustful of punters, who are a bit too chancy for them.
The original conception of the site offered a better deal to losing punters and a working proposition to winning liquidity suppliers. Both have been eroded. Against that, kudos to the techies for letting me post from Chrome. |
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Someone who wins a couple of hundred quid a month or so can easily end up paying it in a few years. So much for it affecting high rollers making loads
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good post (10.07) sandown.
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google the following
"betfair" & "happy hour" also "betfair italy" & "licence" |
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marky sparky 24 May 11 20:52
hardly anyone pays it and those that do can by definition afford to keep paying it. Wrong on both counts. It baffles me how some people think that the PC only affects big players and does show a lack of understanding on who is being targeted. This example would still qualify for the Premium Charge: Weekly commission rate of 5% Weekly total winnings of £500 (after commission) minus weekly total losses of £250 = £250 net profit This profit of £250 at the end of the week would then be deducted with the PC (in this case about £37). Thank you. Proves my point. |
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imo, a good analogy for BF to consider is dyson.
like BF, dyson's business is based on a core product that's perceived to be an innovative breakthrough, with a similar david v goliath popular narrative. (and in both cases, that narrative's become false, with both companies actually dominant players in their key fields.) where they differ is that dyson's understood better that innovation is key to its brand. whereas BF has arguably diluted its brand value by bolting the name onto all kinds of products that are no different from those of their competitors - casino, poker etc. the equivalent would be dyson marketing say a kettle, which is like every other kettle, but has a dyson logo slapped across it. they'd maybe make some money selling kettles, but they'd also degrade their USP. crucially, they'd also be likely to lose focus. the answer to the question "what, as a company, are we for?" would become more and more blurred, just as it has for BF. BF may have been better focusing on the sports exchange, then rather than spreading out into every area of gambling they could think of, trying to find one that seemed ripe for innovation and just going for that one. |
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Screaming - the point is that someone who makes a gross profit of £263 is deducted £50 (commission+PC) to leave them with just £213 for the week.
This isn't an unlikely scenario and it isn't a huge amount. It goes completely against what you're saying that 'hardly anyone pays it and those that do, can afford to keep paying it'. Hopefully this example helps people see the truth. |
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Screaming - the point is that someone who makes a gross profit of £263 is deducted £50 (commission+PC) to leave them with just £213 for the week.
This isn't an unlikely scenario and it isn't a huge amount. It goes completely against what you're saying that 'hardly anyone pays it and those that do, can afford to keep paying it'. Hopefully this example helps people see the truth. |
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Marky, those punters on Betfair who are regularly profiting by £213 rather than £263 per week rather are not the cause of Betfair's lack of growth. They carry on punting.
It is the punters who lose £263 per week even when their betting shows a profit who are forced to desert. |
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I know it's been done to death, but it's worth repeating that all commission on Betfair is paid by losers, not winners.
A bet is matched, e.g. £100 at 2.0. The loser hands Betfair £100. Betfair trousers between £2 and £5. The winner receives between £95 and £98. Winners do not pay the commission. They never see that money. It comes directly from the loser's account. So any growth in Betfair's profits depends entirely on either finding more and more losers or encouraging current losers to lose more. Yet while traditional bookmakers have thrived by looking after their losers and getting rid of their winners, Betfair has continually increased commission rates and thereby done the exact opposite. They appear now to have hit the bottom of their customers' wallets. |
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So any growth in Betfair's profits depends entirely on either finding more and more losers or encouraging current losers to lose more.
---------- what betting firm has that ever not been true of? |
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But what betting firm has ever charged its losers thousands of pounds per year for the privilege of losing?
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all of them. they just incorporate it into the overround.
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Betfair has so many problems it's difficult to know where they should begin.
-They need to constantly find new blood. -Their site creaks under sheer volume of traffic, much of it no doubt not even related to placing bets. -They've created an environment where it's detrimental to bet large amounts of money. -They've created an environment where it's consistently pointless to attmpt to bet. -The PC is bad publicity, and the relationship the company has with its customers in general is at an all time low. To be honest I think they will be lucky to tread water for the next few years. |
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we have had plenty to do with betfair over the years and bad is not the word, they have no idea we were the first with software and the problems they had was just terrible, they really have no idea.
we grew the business for them in 2001/2002 so it was all our fault |
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No bookmaker has been adding to its overround for at least a decade. Quite the opposite in fact, ever since teletext and then the internet made odds comparison and shopping around so simple.
It comes as a shock now if any event on which a full range of bookmakers quotes prices offers a best-price percentage of greater than 100%. Not that it's done punters any good, as it's the no-hopers about whom better prices are offered. One of the ways Betfair has benefited bookies is by showing them that most of the horses/teams/events about which they traditionally offered 33/1 are, in fact, >100/1 shots. This is something Ted Sturman foresaw in the early 1990s. He used to stand as "Fred Binns" on the front row of most southern racetracks, but eventually all his prices became uncompetitive compared with the other books. His contention that an overround of 115% was in reality nothing of the sort, because it included a host of 33/1 shots who never won and were never running for the bookie. He even advertised in the Sporting Life for a computer geek who could run an analysis to prove his point. Eventually Betfair did it for him. It's also one of the reasons it was so much easier to be a long-term winning punter before Betfair. The large, but false, overrounds under which bookies operated lulled them into believing they had scope to lengthen the fancied selections at the front of the market. To put it crudely, Betfair's famous "20% better odds" came from 25% better odds about the losers and 5% worse odds about the winners. And now bookies' price movements just mirror Betfair's. |
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well, you're talking racing and that's about the one sport I don't do so I can't comment. but for football, whilst the best price book across all firms would typically be about 101%, the individual books are nowhere near that. losers in that scenario pay by taking poor value either from laziness, habit or physical convenience. and that's where the firms are making their money, is my guess.
your argument that losers are paying 5% (-discount) on their bets doesn't hold water, imo. by that logic, they're paying 0% on winning bets within their overall loss, so you have to adjust their commission by the ratio of wins to losses. |
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BF's problems are fairly common in succesful startups. Senior management think they are geniuses because the company is so succesful, whereas the truth is they were lucky to launch the right product at the right time.
They then diversify into related businesses (poker, arcade games, etc) and are nothing like as succesful as their initial product. Worse, these diversifications take up more and more management time and company resources and their succesful initial product (the sports exchange) suffers, staff become unhappy cos of the pressure to 'fix' failing products and leave, etc. As for the PC, while I hate paying it, I do have a grudging respect for whoever thought it up. It's rather more thought out than most realize. |
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What is it about traders that make them think they're so important that the rest of us should pay for the running of the site while they get to operate virtually commission free. Their attitude is identical to that of the parasitic sc.um in the financial sector who are getting pay rises and huge bonuses while the rest of the country pays for their mistakes.
Suppose they deducted 22.5% of your lifetime profit as a running total making deductions / rebates after each market was settled and then each Wednesday they calculated what you would've paid under the old system and, if that was greater than what you'd already paid, docked the difference from your account (i.e. they're swapping over the normal and premium charge deduction times). Then 1) Everyone would pay more or less what they do now 2) The Ferengi wouldn't have a Wednesday payment 3) Almost all gamblers would have a Wednesday payment 4) Gamblers would be up in arms at having to subsidise the mainly worthless Ferengi. 5) The only people who wouldn't be whinging would be the Ferengi. Can any pc calimero please tell us why the gamblers should have to make this wednesday payment? Would giving those NOT being charged on the wednesday a rebate of 75% of their previous week's commission be a solution to the above injustice? If you think so then you need treatment. Under the old system if you had 100 backs at 1.1 and they all won and I had 100 backs at 110.0 and one won, we'd both have the same turnover and gross profit but I'd be expected to pay up to 11 times the commission you would. The premium charge doesn't even go far enough to address that injustice as those paying it are still paying a lower percentage of their profits in commission than all other long term betfair winners. They should lower the max rate of commission and recoup it with The all new liquidity generating Premium Charge = (GrossProfit - 5 * CommissionGenerated) / 2. |
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Charge everyone a flat 5% rate per market, job done. Everyone competes on a level fair playing field, and gets treated identically, not certain people being cheated at simply because of the random order of their wins and losses.
How often is this imbecilic suggestion made. If everyone was paying a flat 5% per market there would be no liquidity whatsoever. If everyone paid the same percentage of their overall profits (would probably have to be about 80% for betfair to match existing profits) or paid a percentage of profit on each separate bet that would be a level playing field. A flat 5% per market is not (see my previous post). |
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We're all gamblers Feck - just for different lengths of time.
But for what it's worth lets use your 'all new liquidity generating Premium Charge' on my earlier example: Weekly commission rate = 5% Weekly total winnings = £500 (after commission and other charges) Weekly total losses = £250 Profit = £250 Now let's minus your PC charge from that £250.... (£263.16 - 5*£16.25) /2 = £90.95 WEEKLY PROFIT = £159.05 (after winning £263.16 initially!) Seriously, you think that's the answer? |
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The all new liquidity generating Premium Charge = (GrossProfit - 5 * CommissionGenerated) / 2.
So if I only place one large bet in a week and win 10k I should pay 4.5k in Premium Charge? |