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McChicken_Sandwich
12 Dec 11 04:10
Joined:
Date Joined: 06 Nov 06
| Topic/replies: 2,884 | Blogger: McChicken_Sandwich's blog
http://centrecourttrading.blogspot.com/

Interview with Scott Ferguson
Aaaah, Betfair. They are the betting equivalent of Marmite - you either love them or hate them. Actually, I don't know anyone who currently loves them, so that analogy probably doesn't work. But at some point, every person who discovers the world's first ever betting exchange, does fall in love with the concept. We've all loved Betfair and most of us want to fall back in love with Betfair again. So why are they now reviled by so many? I thought who better to ask than someone who has actually worked for them - journalist, author of the blog 'Sport is Made for Betting' and ex-Betfair employee Scott Ferguson.




You were the Head of Education at Betfair. What exactly did that job entail and what was your background before that?


Great job, working with all levels of punters and teaching them more about Betfair. From complete novices (who needed to start from the very basics) to some of the biggest accounts (who would be most interested in things like keyboard shortcuts), from non-punting staff (teaching techies and the HR girls was always a fun challenge) to business partners etc. My team ran seminars up and down the country, even abroad. Punters loved them because no bookie would ever want them to win, or even just lose less. I also ran the Betfair trailer at sporting venues all over the UK & Ireland (even the day the first one burned down at Uttoxeter!). Great job, totally unique in the trade. But times changed, Betfair are now hell-bent on screwing customers for every penny they can get and I'm glad I'm not there anymore.


My background was unique - I had been a bookmaker, a teacher, a professional punter and a journalist before joining Betfair. The perfect mix! I knew both sides of the betting counter and love explaining difficult concepts to laymen, breaking it down to what they can relate to. The movie 'Road Trip' has a great quote "I can teach Japanese to a monkey in 46 hours. The key is just finding a way to relate to the material." Best example of that was teaching a bunch of our promo girls how Betfair worked by relating it to buying shoes cheap on holiday in Thailand and then selling them on eBay when they got home.





Can you give us an insight into what working at Betfair was like? How was the general day to day atmosphere and did you enjoy your time there?


I joined quite early, back in 2004. Those were fun times, the punters loved Betfair because they were sick of being screwed by bookies and in-play betting with bookies had barely started. I was initially hired to get Australia on-board and spent two years at home spreading the word, before it was left to the lawyers and lobbyists to secure the licence. Then I moved to the UK and eventually created the Education department from scratch. Being on the road a lot was draining, but also rewarding - seeing a frustrated punter who just didn't 'get' Betfair open his mind and start picking up the concepts always brought a smile to the dial.


But as Betfair got bigger and bigger, the fun environment had to change. It got more serious, full of non-punting bean-counters (classic example of one senior manager who wanted to back the tie in every cricket match to ensure no loss of commission - clueless!). Once crap like the casino came in, the company ethos had changed and it went downhill internally from there. Not many of the 'good guys' left...




What have you been up to since leaving Betfair? Are you now trading professionally?


The problem with the role at Betfair was that I'd painted myself into a corner. As it was a unique position, there was really nowhere to go from there, unless I changed tack completely. So I started an MBA before I left to keep my mind active and challenged. I consulted for a few smaller betting firms but they are finding it very tough - the big firms have the deep budgets to chase customers, develop software etc. The small books just can't compete - they don't have the cash or reputation, so they're stuck dealing with a never-ending cycle of bonus ****s and arbers. Got bored of giving advice to owners of small books which they would ignore because 'they knew best', despite them never having placed a bet in their lives! Now out of the industry, doing something better for the world.....

Not trading as much, very difficult with two young kids in the house. Now picking my moments to get involved, rather than trying to make an earn out of everything.




Can you tell us about 'Sport is Made for Betting' and why you started it?

I love writing and wanted an outlet to vent my opinions. I wrote most of the Betfair Education site, I write betting previews regularly for various sites but on the blog, I can unleash on Sepp Blatter, Paul Roy, the ICC and any other muppets I disagree with :) And it also gives me a chance to share a few trading theories - namely lay the field, next manager and on low-volume markets such as Nascar and women's golf. And my posts about match-fixing have led to several interviews with international press.




Why do you think the flotation of Betfair has gone so disastrously?


Variety of reasons. Floated at a bad time, but let's face it, with the economy so cactus at the moment, the next 'good' time could be 2025. It's a tech/gaming stock which are traditionally over-valued. They have pissed off many of their most valuable customers (see next question). Poor leadership from a bunch of non-punters who put the shareholders over the customer and then screw up on both fronts. Limited growth prospects - market saturation in the UK, regulatory problems abroad and poker is a dying fad which they never got right anyway.




Why do you think Betfair has become so disliked by its own customers?


Unadulterated greed. They were the punters' best friend when they first came out and revolutionised the betting industry, making bookies tighten their margins, and introduce a stack of new markets & products to attract more customers. But they, or more correctly those who harboured ambitions of a huge flotation, weren't happy with the small profit margins from the exchange and wanted to screw punters for more and more. So along came exchange games, poker, casino, mini-games, virtual racing... all with marketing campaigns which screamed 'We used to think you were smart betting on the exchange, now we think you're a mug who should piss all your money away on these stupid other products'. But the poker site was always crap and they wasted squillions on it. Casino sites are a dime a dozen and the other stuff is the domain of the cash punter who hangs around betting shops.

Customer service changed from admitting their mistakes and "The customer always comes first", to "Screw you, we're a billion-dollar firm and we don't give a **** that the site went down in the middle of a game", or "We think you've been betting on a suspicious match and will lock your account for a month without giving any details at all".


And then there's the premium charge - absolute PR disaster. Sure it only affects a small percentage but everyone likes to dream, and now that they are stuck for revenue streams, they've dived in again to attack their biggest advocates.




Many Betfair users feel that they are being taken advantage of because Betfair virtually have a monopoly on the betting exchange market. They feel as though Betfair employees really don't care about them and are just out to squeeze them for as much as possible, regardless of fairness. In your opinion, how close to the truth is this?


Hits the nail on the head really. In the early days, everyone they hired had a betting background, or at least an interest, so they understood the markets, issues, customer concerns etc. Now they just hire standard call-centre workers, as cheap as they can, who could be stuffing you around for Vodafone or a bank or an insurance company. Makes little difference to them, they just look up the answers to standard questions in the manual and copy & paste it onto your reply. And then there are the bean-counters/analysts who need to find a way to make more money, so the best way to do that is screw winning customers for more money via the premium charge and/or API fees.




Have you noticed a change in the ethos of Betfair and the way it has been run down the years?


Chalk and cheese. It was great fun in the early days, truly blazing a trail, changing the betting industry for the good of the punter. Then they started hiring 'experts' from other fields, because they 'obviously' knew how to run a highly successful betting company. Some real bone-headed decisions were made, very damaging to internal morale and when stuff like that happens and said experts aren't held accountable for them, the fun starts to disappear. Once they forced Andrew 'Bert' Black out of a day-to-day role (because he understood the industry and felt for the punter), it went downhill fairly quickly.

I joined the company to work for Ed Wray & Bert (and to a lesser extent, Mark Davies), following their dreams of an exciting concept taking over the world of betting. It was a great journey. But once it was obvious they were being forced out/their roles diminished to bring in the new breed of dull, passion-less business 'experts' who essentially saw customers as the enemy who must be exploited, it was time to move on and I don't regret leaving when I did.




Many people in high management positions have left Betfair in recent times. Why do you think this is?


99% of people in business will struggle when a company goes from 10-20 guys in a small office to over 1000. The business simply has to change, become hard-nosed over costs, stop treating PR as a laugh and really focus on a consistent core message etc. Senior execs in business these days change jobs all the time - clash of personalities, they screw up, they've done what they set out to accomplish etc. Many of the original staff left after the float - and several of those guys, even the ones way down the food chain don't have to work again for a long, long time. Others saw that as the right time to move on, having to answer to shareholders who don't understand the impact of bad weather on football & racing or the negative impact of raising commission rates etc. Pressure on the top guys is severe and now they are public, blood must be shed regularly if results aren't up to scratch...




Betfair have recently installed a new Chief Executive, Paddy Power's Breon Corcoran. What do you think he has to do to restore Betfair's reputation?


Stop focusing on the City and get back to looking after customers. Stop deluding themselves in thinking it's a technology company - if it was, it would be listed next to Dell and Microsoft in the Yellow Pages. It ain't. Hire people who actually go to the races or sporting events for reasons other than to get plastered in the hospitality suites.




The Premium Charge and Super-Premium Charge; in your opinion, why were they really brought in?


Greed and desperation at limited other options to increase revenue. It is true that the 'sharks' at one end do scare away the little fish, and those little fish are expensive to acquire. But without the big players providing liquidity, you don't have a business, so it's a dangerous game. The best way to hang onto those little fish was to educate them and make them aspire to climb higher on the food chain, but they effectively killed off the Education dept.




Where do you think Betfair is headed in 2012 and beyond?


Bound to tread water for a long time. I really hope this new bloke proves me wrong, but I doubt it.




How far behind Betfair are **** and do you think it's possible for them to become a realistic competitor?


Ever heard of Alpha Centauri, the nearest star outside our solar system? That's how far behind they are. Betfair have kicked so many own goals in recent years and they still are a million miles away. They'd need the Chelsea/Man City style investment to have any chance of competing properly.




What do you believe are the chances of the American betting market opening up? What do you think would happen if it did?


News this week suggests California and New Jersey are closer than ever. But the American scene is so political, and it's all divided by state. Australia was very hard to crack a licence, but there was never an outright ban to overcome. America is a farce of a place regarding betting. I think it's in Arizona, you can't even bet on horse-racing online. Sports-betting is the big one, but outside of Nevada, it's all done illegally. Racing is where they'll start as that industry is dying a slow, painful death. Every local deal will have to provide a share of the profits to local racing, namely the 'horsemen's groups' who are the original 'Flat Earth' society in many states. Understanding the concept of lower margins = higher turnover is beyond them, yet you'd think with stores like WalMart everywhere it wouldn't be rocket science.


I'll go on record as saying the USA will never be completely open to Betfair, there will always be states who still think it's 1953 and that mythical being called God said gambling is evil (they should try asking their Irish ancestors!). And until there is a Federal Government with a proper majority and mandate for change, they won't be able to force the issue either. Australia has been a slow graft for Betfair, but it will be like an Olympic 100m final compared to the never-ending saga in the States.

If they were prepared to open the chequebook and effectively bribe the first few states into jumping on-board with huge sign-on fees, that would give them a kick-start. But a simple, seemingly no-brainer, issue such as being able to combine customer bets across state borders will hold them back. I would bet against them being able to link up with bets from the UK & the rest of the customer base in the short term - I hope I'm wrong. Without liquidity from a big audience of legal players, they will find it very tough to gain any traction. And until you have an attractive product with plenty of choice and liquidity, it's a lame duck....




Many thanks to Scott for taking the time to answer my questions - fascinating stuff. As ever, I'm available on TWITTER or via email (there's a link on my profile). Would be good to get those follower numbers up. Maybe a few more will be enough to motivate me to do some more interviews....... ;)


*As always, feedback and comments are welcome and I'd love to see more but if you are going to be a rude and needlessly critical ****, then don't bother. I do this for fun in my spare time, it's not a job, I don't get paid, I'm not trying to sell anything, and I don't care if you read or not, so if you have a problem I suggest you piss off and do your own interviews!

**VOTE LITTLE MIX!!! ;)
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Report FINE AS FROG HAIR December 12, 2011 5:28 AM GMT
Despite all that he says, which undoubtedly is likely to be a fairly accurate reflection of the inside of BF, it still remains a wonderful alternative betting option for so, so many people, to being royally screwed by the major bookies.
Personally I couldn't imagine my " betting " life without it.
Long may it survive and prosper.
I hope good competition from other sites evolves in due course ( though I doubt it from the sound of Ferguson's comments), if only to ensure that monopoly fever/abuse does not destroy the whole edifice.
Report Chosen® December 12, 2011 8:11 AM GMT
Excellent interview. Thanks for posting.
Report Deltâ December 12, 2011 8:52 AM GMT
ditto
Report Methane_Magnet December 12, 2011 10:12 AM GMT
Probably the most accurate and perceptive account ever posted on here.

I don't suppose it will ever happen - but they really ought to hire him back as a consultant.
Report FINE AS FROG HAIR December 12, 2011 10:21 AM GMT
Just don't put him in the same room as the vaporiser eh MM ?.
Somehow I don't think they would get on too well.
The new MD could do a lot worse than sitting down and absorbing many of the points made in that interview.
And you know it doesn't at all come over as  nose out of joint barbs of a bitter ex-employee.
Quite the opposite in fact.
Critical but constructively so.
Report jimmy69 December 12, 2011 10:22 AM GMT
I wouldn't take 1000 on him gong back. Scotty is happy elsewhere.
Report Sandown December 12, 2011 10:27 AM GMT
Good interview. Confirmed what has been posted by many on the General Forum over the years. Would have liked some views on the growth of the trader/trading and its effects on other players and on the business.
Report jimmy69 December 12, 2011 10:29 AM GMT
http://twitter.com/#!/borisranting
Report crystalhunt December 12, 2011 10:44 AM GMT
Good read - Betfair is still the best option for many punters but it's sad to see how things have changed for the worse from the early days.

'All that glitters is not gold' comes to mind.
Report Mister E December 12, 2011 10:48 AM GMT
excellent interview.

Scott's description of the evolution of Betfair mirrors most of the big betting companies; bean counters and people who don't understand the basis of the game  taking over, ceases to be fun, customers inundated with mug games, "good guys" leave, "greed and desperation to increase revenues, service levels sink etc.
Report Methane_Magnet December 12, 2011 10:48 AM GMT
Finest gold in town, transformed into r4tners
Report FINE AS FROG HAIR December 12, 2011 10:49 AM GMT
And odds on this thread being mysteriously vaporised sometime soon ?
Report jimmy69 December 12, 2011 10:51 AM GMT
Why chould it be? Scotty didn't leave under a cloud...and what he says is common knowledge to all intelligent punters on here.
Report FINE AS FROG HAIR December 12, 2011 10:53 AM GMT
I agree, but from MM's posts on another thread, some do seem to be a mite sensitive to criticism at BF towers.
Report Methane_Magnet December 12, 2011 11:08 AM GMT
If they got ride of everybody that had a negative view of how they have developed (since about 2004) - they wouldn't have any customers left FAFH. It would turn into the king of company that banned the press from their Results Announcement.
Report Methane_Magnet December 12, 2011 11:09 AM GMT
the kind of company that banned the press from their Results Announcement.
Report TRD.Racing December 12, 2011 11:12 AM GMT
A prime example of exactly how rancid this company is,the last race yesterday in Ireland. Betfair make a mistake by not turning the race in play. So anyone who wins on the race in running is told the bets are void. So Betfair make a mistake and the punters have to pay for it.
Report jimmy69 December 12, 2011 11:13 AM GMT
That seems fair to void bets.
Report FINE AS FROG HAIR December 12, 2011 11:19 AM GMT
Btw why did the founders of BF become so marginalised and eventually irrelevant in their own company ?
After all it doesn't have to be that way ( Google being a current classic example of that ).
Did they lose motivation?
Did they lose vision/run out of ideas ?
Did it all become too techie for them to fully understand and control?
Or were they only ever in it for a quick buck ?
What is the real story there ?
Why were the bean counters allowed to take over ?
Report jimmy69 December 12, 2011 11:23 AM GMT
Bert took the money and ran.
Report acquiesce12 December 12, 2011 12:03 PM GMT
And odds on this thread being mysteriously vaporised sometime soon ?


well it's on the golf forum, and I posted it on the football forum, if all 3 disappeared that would say alot.
Report acquiesce12 December 12, 2011 12:04 PM GMT
also kinda reminds me of when steve jobs had to leave apple then they realised they needed him back.
Report frog2 December 12, 2011 12:35 PM GMT
I dont understand why the founders let outsiders takeover the company and tear it appart. Surely they are still the biggest individual shareholders and have the most to lose.
Report jimmy69 December 12, 2011 1:45 PM GMT
They have too much money to worry about that.
Report Do wah Diddy December 12, 2011 1:53 PM GMT
THANKS FOR POSTING IT ,
Report Do wah Diddy December 12, 2011 1:55 PM GMT
THE SHAREHOLDERS PROFIT WILL ALLWAYS COME FIRST FROM NOW ON
Report slartibartfast December 12, 2011 2:19 PM GMT
Good post thanks.


Looks like we can expect PC4 in the very near future.

Sad
Report CLYDEBANK29 December 12, 2011 4:33 PM GMT
Often the founders get pressured out.  Not saying that is the case with Andrew Black but it could be.  From reading the odd article about him he didn't seem to be a highly driven individual, just a normal bloke with a good idea, who dare I say got a bit lucky.  A normal bloke would take the money and enjoy life.

The interview is a really good read, insofar as a partial outsider, it says it exactly how I feel it is.  Very rare for me to be in total agreement with everything said.
Report Mr.Angry December 12, 2011 10:24 PM GMT
Thanks for the post.

I met Scott once, seemed like a decent chap.  And I agree with 100% of what he says in this interview.
Report Feck N. Eejit December 13, 2011 10:29 AM GMT
I think a lot of people are romanticising by concluding the pc would never have happened if Bert & Co were still in charge. 1.01 they were in agreement with it.
Report StreetFutsal December 13, 2011 2:11 PM GMT
^^ why do you say that ?
Report Feck N. Eejit December 13, 2011 2:17 PM GMT
Educated guess SF. They were city boys just like the PC's creator.
Report FINE AS FROG HAIR December 13, 2011 2:55 PM GMT
The pc perhaps, but PC2 ?
Report andyl December 13, 2011 3:27 PM GMT
betfair has treat its core customers with contempt....name me one other organisation that would charge some of its better customers with obscene charges!!!
Report StreetFutsal December 13, 2011 3:40 PM GMT
it's better customers take alot of money out of the system, that was the problem.
Report Lex December 13, 2011 3:51 PM GMT
the police
Report andyl December 13, 2011 4:05 PM GMT
but also put alot of money into the system in the first place streetfutsal..it's called liquidity....i've paid over 200k in commission....thats about 30k a year for every year i've been on betfair....how much liquidity does betfair provide???? absolutely sweet fa
Report Lex December 13, 2011 4:09 PM GMT
But you made profit from using the service. Why shouldnt you pay for for is effectively stock for your shop
Report andyl December 13, 2011 4:09 PM GMT
all betfair is ....is a concept (an exchange)...and betfair provide the it infrastructure to facilitate peoples bets and settle them ....nothing more or less....should i pay more in a week in commission and premium charge than the average monthly mortgage payment ffs....NO
Report Lex December 13, 2011 4:09 PM GMT
for *what
Report Lex December 13, 2011 4:11 PM GMT
ok your charges are high - but how much have you profited compared to the average mortgage payment?
Report andyl December 13, 2011 4:13 PM GMT
I have lex ten times over that is the point....and now i am being shafted for my loyalty !!! couldn;t make it up...wouldn;t be a problem if there was a decent few alternatives but there is only 1 and its pants for in running
Report StreetFutsal December 13, 2011 4:13 PM GMT
andyl - I'm aware of what liquidity is thanks, - but you can't have your cake and eat it, a business is a business - it's main aim is profit - the PC was designed to increase company profit so individual sob stories are not of interest to them to be honest.
Report abolo December 13, 2011 4:15 PM GMT
Is a core customers useful for a firm ? 100 customers paying 1 pound is more valuable than 5 customers paying 10 pounds
Report andyl December 13, 2011 4:18 PM GMT
but lets face it over 90% of betfair's customers lose.....and the less than .5% who win decent money consistently now form a large % of betfairs overall profits....

the only difference now between betfair and a bookie is that bookies restrict or ban succsessful customers betfair just takes a nice slice of their earnings
Report Lex December 13, 2011 4:22 PM GMT
Also you can get a bet on easier with betfair.
Report andyl December 13, 2011 4:23 PM GMT
it's irrelevent....betfair moved the goalposts recently....until then i never paid anything in pc because i generated too much commission....now i am being penalised just becaused i have earned more than 250k in my lifetime but over 7 years that works out to be just over 30k a year....betfair management has lost the plot doing what it did with pc2....and maybe it has killed itself time will tell Grin
Report abolo December 13, 2011 4:23 PM GMT
Maybe, andyl, i'm ignorant of the numbers on that matter. I always thought Betfair was doing most of its profit with little customers attracted here by ads than with the big players, but maybe i'm wrong.
Report StreetFutsal December 13, 2011 4:26 PM GMT
True, they took a big risk by biting the hand that feeds them, but looking at the aftermath - the big players are still hungry and are still feeding.
Report Feck N. Eejit December 13, 2011 4:26 PM GMT
If bookmakers didn't restrict winners and exchanges were made illegal how many of betfair's successful customers would continue to be successful? It would be very near 0% as bookmakers are hardly going to allow themselves to be cheated the way betfair allows those who truly fund the exchange to be cheated. Neither would they be giving out the information traders require to function.
Report Feck N. Eejit December 13, 2011 5:01 PM GMT
Is 20%, or even 40%, not a good deal for most when you consider betfair supply the mugging facilities, the mugs and pay off the "law"?
Report StreetFutsal December 13, 2011 5:21 PM GMT
There should just be a fairer commission structure then everyone would be happy.
Report McChicken_Sandwich December 13, 2011 5:44 PM GMT
Feck N. Eejit
13 Dec 11 17:01 Joined: 10 Jan 02 | Topic/replies: 6,144 | Blogger: Feck N. Eejit's blog
Is 20%, or even 40%, not a good deal for most when you consider betfair supply the mugging facilities, the mugs and pay off the "law"?


Is 40% a good deal for you, feck?
Report FINE AS FROG HAIR December 13, 2011 5:47 PM GMT
Well I never.
A thread involving BF turn into the usual circus event.
Successful punters complaining about the PC. Not all just some.
Feck trotting out his usual lazy, greedy trader arguments.
Anything new today folks ?
Report paul_sw December 13, 2011 5:55 PM GMT
Unadulterated greed.

But they, or more correctly those who harboured ambitions of a huge flotation, weren't happy with the small profit margins from the exchange and wanted to screw punters for more and more.

Shocked
Report Feck N. Eejit December 13, 2011 5:56 PM GMT
No M_S. The sins of the cheats and traders have been visited upon the straight players. 40% would be perfectly acceptable if the site was gambler orientated but as it's run for traders and cheats it's too much.
Report McChicken_Sandwich December 13, 2011 6:23 PM GMT
Why do you group traders and cheats as almost one and the same?
Report McChicken_Sandwich December 13, 2011 6:25 PM GMT
Anyway, scrap that actually, there's no point you peddling out the old routine.

Hopefully the new supremo doesn't continue the squeeze further.
Report Feck N. Eejit December 13, 2011 6:31 PM GMT
I don't but they're the reason I'm on 40% and will probably be taxed at some point in the future.
Report dlarssonf December 13, 2011 6:51 PM GMT
ffs another thread hijacked by the bitter buffoonCry
Report no moves December 13, 2011 6:53 PM GMT
Isn't proxima centauri the nearest star to us after our own sun?
Report Feck N. Eejit December 13, 2011 7:12 PM GMT
ffs another thread hijacked by the bitter buffoon

What kept you arsfondler. Laugh
Report dlarssonf December 13, 2011 7:14 PM GMT
wow that's brilliant.

Laugh


Feck N. Eejit     13 Dec 11 17:56 
No M_S. The sins of the cheats and traders have been visited upon the straight players. 40% would be perfectly acceptable if the site was gambler orientated but as it's run for traders and cheats it's too much.

why are you here?Laugh
Report Feck N. Eejit December 13, 2011 7:28 PM GMT
why are you here?

wow that's brilliant

Laugh

I wasn't talking about the forum.

Feck N. Eejit
Report FINE AS FROG HAIR December 13, 2011 8:56 PM GMT
I don't know about anybody else, but in this " friendly" exchange between feck and dlarssonf, I can't exactly work out who is saying what to whom.
But does it matter ?
Report aspy65 December 14, 2011 2:35 PM GMT
who is the pc creator ?  is there a well known name in the betfair company who first came up with the whole pc concept ?
Report jabmast December 14, 2011 2:45 PM GMT
The guy who invented the pc, used to be on here, went by the name of "bot".
Report good value losers December 16, 2011 12:17 AM GMT
andyl     Joined: 28 May 02
Replies: 633 13 Dec 11 16:23 
now i am being penalised just becaused i have earned more than 250k in my lifetime


Shocked you must've achieved an amazing turnaround in fortunes Laugh you were one of the original and biggest jonahs on the site 6 years ago. i remember you stopping one odds on shot after another over the jumps. bigged up kauto star at long odds on in a 4 horse race when he fell and was out for the season!
Report askari1 December 16, 2011 4:22 PM GMT
Brean Corcoran, who had the top job at a bigger, faster-growing bookie, is joining bf; and that can only be b/c he sees the exchange model, properly marketed, as having better growth prospects.

The only reason for this in turn is that it can offer market-efficient prices. Supposing that markets evolve towards an equilibrium relatively quickly this means that volumes drive company profits at an exchange.

The current people at the top of bf do not see price as the driver that will help them attract more customers (or do not see it clearly enough). They are more interested in cross-selling non-core products to customers and getting a greater share of customers' betting pound.

We have to hope that Corcoran improves things for the marginal (say breakeven b/f comm.) punter, so that everyone who takes something from the exchange (the operator, winning punters, hedgers) can benefit again from a healthy ecosystem.
Report askari1 December 16, 2011 4:27 PM GMT
Where I don't agree w/ Scott Ferguson is in thinking that it was ever feasible that the most basic kind of 2 quid punters ever had any kind of aspiration to 'move up the food chain' by trading or spending more time on here applying more complex strategies like book-making.

There are always going to be huge quantities of betting fodder for people who can program or even price; and it's rather in the long-term interests of winners that the small fry shd 1) lose less than elsewhere; 2) lose slowly; 3) arguably, not lose implicitly the second they have placed their bet due to an advantage bf provides its resident winners.
Report Coachbuster December 16, 2011 4:40 PM GMT
I read this  on another forum  - rather interesting view from BDQ Towers ,but surely if both BQ and BF lock horns for business there would be something akin to a price war ?


What is the comhttp://centrecourttrading.blogspot.com/pany's attitude towards those who might win consistently?


We prefer to look at whether a member’s activity is positive or negative for the exchange ecosystem as a whole. Positive behaviour such as liquidity generation can be rewarded with lower commission rates and negative behaviour discouraged through higher charges. That’s how we approach our API charging and it has nothing to do with winning or losing.



What are the company's general thoughts about the Betfair Premium Charge and is it something that you would say will never happen on ****?


We love the Betfair Premium Charge as it has given our business a big boost! Seriously though, we believe charging should be about contribution to the exchange as a whole and not about winning or losing.
Report askari1 December 16, 2011 5:02 PM GMT
They are surely just saying that. A winner is a winner is taking from the bookie.

Bf did miss a trick, though, in not discriminating between price offers and price-takers in its calculation of implied comm.
Report TheManIsAGent December 16, 2011 5:07 PM GMT
Are you saying that the changes to the pricing structure were not well thought through? Laugh
Report frog2 December 16, 2011 9:10 PM GMT
'Bf did miss a trick, though, in not discriminating between price offers and price-takers in its calculation of implied comm. '

What is the difference? If someone pays a low commission to winning ratio who cares if they put up prices or take prices others have put up? Both generate liquidity. The key thing is the rate people win at.

I just wish the head of Betfair would sell the PC to investors and punters as a concept. I think it was Mark Davies that wrote on his blog something like the CEO should be the face of Betfair. But we never hear anything from him. Betfair want the winners to take less out of the ecosystem. I buy it to as an idea if that money is somehow used to make losers lose slower. If the money is just added to Betfair's profits it is doing nothing to help the longterm exchange ecosystem. I would like to see that money (i.e. the money taken in PC) reinvested in losers.

Lower commission or a proper sportsbook linked offering Betfair prices leveraging on the liquidity generated here. They havent tampered with pricing at all. On 5% commission how can they compete on football and American sports. What happened to differing market base rates?
Report askari1 December 17, 2011 2:29 AM GMT
frog, if pc were given back to losers in the form of ring-fenced seed money that bf just wrote off as an absolute loss a la sporting options Wink, I wdn't hate the principle of pc so much, but I believe it's just used to boost the bottom line.

I was describing pc as an intervention in pricing--by implication bf make it more expensive to play for the pc payer, forcing them to take on a greater margin of safety and thus give worse odds to the casual or opinion player. In horseracing, the sport for which the betting shape of the events shd give bf their best opportunity of being best price, turnover seems if anything to have fallen away. That is, punters are leaving bf to bet (or spend their money or save) elsewhere. This suggests to me that the modifications to pricing effected by the pc are having an adverse effect on the company's competitiveness. (This seems true in principle even if the vast bulk of money matched on the horses is surely between counterparties and a very small handful of tiny-margin near-off 'books').

My thinking on price-offerers were that they enhanced the betting experience of casual bettors by giving a fine spot price. If offerers are filled in more often, they can afford to win at a worse rate, and they're further unlikely to be following momentum strategies.
Report Win only - Sp only December 29, 2011 10:34 PM GMT
ttt
Report BIG GURU December 30, 2011 12:51 AM GMT
Scott Fergusons blog on this mess
http://www.sportismadeforbetting.com/
Report Lori December 30, 2011 2:01 PM GMT
one senior manager who wanted to back the tie in every cricket match to ensure no loss of commission

I remember my local casino banning a big punter from roulette because he was messing up the drop percentage. I always thought that would be the stupidest thing I ever heard regarding running a gambling establishment, but boy the above line runs it close.
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