SYMPOSIUM: Betfair exec.. "Exchange format is U.S. future"
 

Betfair lobbies for U.S. allies
By Matt Hegarty

http://www.drf.com/news/article/109426.html

TUCSON, Ariz. - The world of entertainment has changed rapidly in the last 15 years, and the racing industry will need to adopt new betting models to compete or face a slow death, the chief executive of the British bet-matching company Betfair told the racing industry during Tuesday's opening session of the University of Arizona Symposium on Racing and Gaming here.

Gerard Cunningham, the U.S. representative for Betfair, said that younger generations have grown up in a world in which data-rich entertainment options and social networks are de rigueur, a dynamic that he said threatened racing's current business model. In addition, Cunningham said, other gambling options such as slot machines and poker give bettors a bigger bang for the buck, allowing those games to steal market share from racing by merely tapping bettors out over a longer haul.

Cunningham then invited racing industry officials to meet with him to discuss the legalization of betting exchanges, a type of market-based betting pioneered by Betfair that allows customers to bet against each other. Betting exchanges are illegal in the U.S. because the government believes that they allow customers to act as bookmakers.

"My concern is that if we don't do this, I don't know what the future looks like for us in racing," Cunningham said.

The comments underlined Betfair's efforts to ally the U.S. racing industry to its cause so that it can go hand-in-hand with horsemen and racetracks to lobby for the legalization of betting exchanges. Earlier this year, as part of that effort, Betfair purchased the account-wagering company TVG, giving the company a U.S. foothold for its operations.

Steve, how do you feel about betting exchanges. I used to do quite well on IBETX laying against odds on favorites and getting juicy odds when going long a horse. Having said this , it is wide open for corruption as it is very easy to make a horse lose.

Please legalize this so I can offer the RockHardTens of the world healthy odds on Zensational in the Sprint.

From my expierence when laying against non odds on horses you need to offer at least 1.5 times track odds to get hit. For longer shots much much more. 1 loss wipes out a whole lot of wins.

I don't have enough understanding of the concept to fairly judge as I didn't get involved when it was out there initially. I know it's too successful to ignore, and if it can be formulated to allow tracks/horsemen to share in the handle, it has the potential to entice a new generation of player and be vital to whatever is ahead in North American racing. But if it only siphons action out of the pari-mutuel pool, it's a problem.

Simply put, it would lower the takeout which would attract more gambling money....Horse racing needs to compete with sports gambling.

The lowering of takeout is a bit of a canard though Rand... It absolutely can stand to come down of course to a level that's 'right' and stimulates handle to the point that offsets the decrease. There's numbers that make sense for everyone and are simply necessary to pay for the overheads of everything involved in putting on the show.

But more than takeout, the nature of the internal model demands adjustment. As has been discussed widelt in the "model is upside down" discussions, the bet-takers are getting too much... The source of the product deserves an increase in the share.

10% on WPS should be a start just like sports betting. Breakage needs to be reassessed as well. I don't think its a canard. Bigger dollar players would play horses if they perceived it more as a beatable game than a hobby.

Satish Sanan, who is as big a player as is out there, says those whales are still out there but are playing outside the pools.

How about...

10-12% WPS.
14-16% 2/3 horse exotics/multis.
18-20% 4-6 horse exotics/multis.

These numbers are OK as long as the distribution reaches the bricks and mortar origin of the bet properly...

Exactly, no problem with that. Horse racing always seems to forget it fails without gamblers.

Steve, what does it mean when you say "whales are still out there but are playing outside the pools". Are they using exchanges and off shore rebate shops?

Yup..

In my opinion this is the #1 problem facing horse racing today. A narrow second is the fragmented, uninterested and annoyed core customer base.

The amount of money going offshore is scary and it's meaningful enough to horse racing's bottom line that it should be at the forefront of discussions. Instead, many people seemed to be focused elsewhere.

Back in the day, Satish used to hang with us slobs in the Tampa Clubhouse, dude FIRED away. Something I had never witnessed before, or since.

:eek:

Sanaan likes to bet? Wonder how much he can get off on a cricket match?

He's a two-fited bettor. Saw him in action up close at Breeders' Cup.. I'm sure he gets down on "International test matches"...

Which pools does he swim in?

He's uses licensed American ADW's.

Sorry I wasn't clear. I meant Win , Pick 4's 6's Trifectas....

LOL... Big exactas, tris, doubles particularly from what I heard him doing at Cup.

It is all relative your 10 pick 3 and his 5000 dollar ex box..

True... His Exacta is my Mortgage payment

Yeah, I've seen him in many a betting line at Saratoga.