The idea that Betfair have upped the PC to help losers is laughable.

If pre-60% the 500 were winning on average £100k a year the losers lost £50m. The winners paid 20% PC so Betfair got £10m and the winners got £40m, each taking £80k after 20% PC.

With 60% PC if half the PC payers have left the losers still lose the £50m. 250 PC payers now win £200k. If on average they pay 50% then Betfair's take has gone up to £25m. The PC payers get £25m each taking £100k after an average of 50% PC.

All Betfair have done is take advantage of people with an advantage. The way to help the losers is to reduce their commission to make their money last longer.

In the conference call it was made clear that the premium charge was brought in for unprofitable customers.

The bottom line is that it was introduced to boost betfair's potential profits at a time that they are struggling to satisfy shareholders and the market.

The ecosystem argument follows on from this in that Betfair want a bigger share of customers profits.

Its all about betfair management trying to boost profits and justify their high pay and bonuses.

the link to the 0.71% figure is at the bottom of this article although i don't remember it as only concerning the backing and laying of horses.

http://www.telegraph.co.uk/sport/2376398/Sting-in-the-tail-for-bookies.html

Some of the stuff on this thread is laughable.

"fair exchange"    "£35m is enough"  "justify high pay and bonuses"

Everybody trying to run betfair's business for them from scraps of management information.

Betfair is a business

It wants to maximise profits

End of.

Move on.

yes..Johnny The Guesser

betfair is a business...just as bet365 is a business...and both bookmakers only want losing punters

i have just listened to the first couple of minutes of that conference call.

david yu seems to talk about individual firms offering goods odds on the odd event as a market push but "we offer consistent value over time"

we offer consistent value over time.

i'm a bit confused.

that's not how i thought this all worked.

No, they haven't cut winning accounts.  They have imposed a minimum amount of commission that has to be paid relative to gross profit.

And I'm not a Betfair plant I am a (still) profitable player yet to pay any pc.

How do betfair replace the money that those people are winning with new money please?

zeeny Joined: 26 May 03
Replies: 507 08 Sep 11 11:05   
It's about time they label the platform for recreational purposes only and remove long term winning accounts altogether.
It's for fun, you aren't supposed to be able to make money! 


That is almost exactly what Worldwinner did back in about 1999-2000 fwiw. They did it via a convoluted means, not entirely dissimilar to how Betfair are doing it, but it's what they did.

Too much scaremongering and sensationalism on here :-

"It's the end of the exchange"

"Just another bookmaker"

"Winners banned"

"Goodwill destroyed"

Why do so many feel the need to distort the truth?

For 99%+   nothing changes...and you all know that!

The profitable recreational punters can just carry on as before...getting better odds...nicking our slice of the value...and booking our profits at the end of the year.

Why won't you lot acknowledge that?

Did you really expect Betfair to let you continue to run your "businesses" on the back of theirs, for ever?

Rollo is right--bf take advantage of those w/ an advantage, and the advantage these people have is typically either unfair e.g. privileged info. or in the nature of a three-card trick e.g. a picture advantage.

As to whether the pc allows losers to hold onto their money... well, not on the basis just outlined. By forcing pc payers into breakeven churn strategies, bf act to populate markets at fair value and this helps losers to get a better price. But they are likely to bet in an undisciplined way and lose anyway.

There seems to be little reason to me why bf wd want to tolerate 5% comm. winners. If you look at other bm s that tolerate winners, they do so b/c there is something that these players have to give at the same time as making their bet--information and pricing expertise.

This kind of non-monetary handover doesn't apply to the bf model.

As for David Yu's conference call, he doesn't seem to me to understand that bf are rarely going to be best price for anything outside of horses, the segment with a fanatical but dwindling following where they first made a breakthrough.

They are in a competitive marketplace and should think of how to be best price more often, rather than just try to cultivate customer loyalty.

You'll b accused of having been head hunted by betd@q now bff.

I think most people like me still love the exchange model but customers deserve respect and not treated like lambs for the slaughter made worst by posters trying to infer that winners are scum, if you remove the winners you remove the stock and heart of an exchange so this/they must be kept intact
and I think its customers as much as betfair that have brought this company this far.

Its not worth answering that point as most customers are now fully aware that BF
are trying to capture as much percent of every gbp of revenue placed into accounts to offset
there in-efficient spending on maintenance and growth and how do you replace customers
or encourage share buying when too many alarms bells are now ringing?

care to answer that little poser?

correct hazel, well said

I wonder what donald trump or alan sugar would do with betfair if they became the MD?

(a) Retain the only big edge betfair has the"exchange model"
(b) Drive down expediture
(c) Spend money on effective promotions and advertising only
(d) Avoid new global market capture that is unprofitable in first years because of red tape issues
(e) Keep only the best staff and reduce hours for some posts
(f) Bingo product development
(g) drop lmax

But here I go just another customer trying to run betfair, silly me[;)]

Hang on, try googling his name , hes been scamming gambling sites and accounts many times
Alistair Peckover is a known swindler, cant blame betfair or the police, hes done something more than avoiding pc, he deserves what ever he gets.

bf fan thanks for that. Quite a nasty operator but pretty clever. Poor piece in the Post not really putting you in the real picture.

Not sure when BFF had his epiphany. I presume he's been pulled aside and told to show PC payers more respect. Before it was all about how "weak willed" we all were, and had to "pay our rent".

Now he's demanding we are treated with respect.

Too late though. The impact has been made, and we are not as reactionary a group as he thinks.

Here's a hypothetical question...

Would BF have a) been more successful  b) as successful   c) less successful than they have been if they had launched with the current PC charge in place.

If BF genuinely believe that the answer is either a) or b) then they may need to re-think whether they have the right people in charge.If c) then they ought to reflect on their own integrity issues.

I might add that the answer to this question in no way depends upon whether PC is being paid or not because if, as JTG would have it, 99% are not affected and therefore it doesn't matter to them,I would say that having an opinion of say income tax levels should not be dependent on what level one pays. This argument is similar to the one always deployed in defence of the argument that non-experts/non-users opinions not being worth listening to, which is a patronising opinion to have.