Betfair Thieves

[timgolfy]

Betfair have today announced new charges for winning customers.

Get this: 40% to 60% of total profits.

I used to recommend Betfair to everyone as the next generation for betting, but now I recommend Betdaq.com.

 

[fundy]

In a state of shock here at the moment Tim, has serious serious consequences for me, almost to the point of whether what I do can continue

 

[timgolfy]

It's totally shocking, and probably marks the demise of Betfair (certainly as we know it).

 

[EZprophet]

Do you have a link to a source?

This could have very serious consequences for myself also....

 

[fundy]

theres an announcement in the general betting section of the forum, if you are affected initially you should have been emailed by now

 

[timgolfy]

Those affected informed by email, but check the Betfair General Betting forum for info.

 

[surefire]

Well if Betfair becomes unusable, there is always Betdaq and WBX, however at the moment Betfair is clearly king for liquidity.

However, I'm guessing that in the online world, winning gamblers are like people who average 320 yards with the driver - Some do it, but not as many as claimed.

The new charges only affect people who:

Lifetime net profits* exceed £250,000
Lifetime commission generated less than 40% of lifetime gross profits
Bet in more than 1,000 markets

So basically unless you win loads and don't pay much commision (i.e you're not profitable for Betfair) you'll be fine. I'm guessing 99.9% of all betfair users (let alone members of this forum) are perfectly safe from this charge.

 

[surefire]

It's totally shocking, and probably marks the demise of Betfair (certainly as we know it).

Doubt it, as the charge will affect very few people. In fact it will most likely make betfair stronger, as they will get rid of unprofitable customers, without upsetting the people who make most of their money.

Even if unaffected people do go and look elsewhere, it's likely they will come back, due to the lack of liquidity on other exchanges.

It's not great PR, but Betfair will live.

 

[fundy]

great attitude surefire, it doesnt affect me so its good news? you think they stop at this? they are trying to squeeze more and more money out of a limited pool to justify a ludicrous stock market listing as a growth tech company

it is clear they would like to drive a lot of the big winners out, you would expect to be replaced by there own seeded traders, and then they just become no different to the other books

sooner rather than later they will go too far and drive a decent competitor out of the woodwrok, hopefully this is the final straw on that front and betdaq will actually get its act together, sort out its interface and aggressively market itself as a genuine alternative

 

[fundy]

btw a huge chunk of Betfairs success was based on the fact that winners were welcome, that gave aspiration to anyone who punted there, they are basically now shutting that door and removing that aspiration

 

[timgolfy]

So basically unless you win loads and don't pay much commision (i.e you're not profitable for Betfair) you'll be fine. I'm guessing 99.9% of all betfair users (let alone members of this forum) are perfectly safe from this charge.

The commission rate has risen from 20% to 40% and to 60% for some.

 

[surefire]

great attitude surefire, it doesnt affect me so its good news? you think they stop at this? they are trying to squeeze more and more money out of a limited pool to justify a ludicrous stock market listing as a growth tech company

it is clear they would like to drive a lot of the big winners out, you would expect to be replaced by there own seeded traders, and then they just become no different to the other books

sooner rather than later they will go too far and drive a decent competitor out of the woodwrok, hopefully this is the final straw on that front and betdaq will actually get its act together, sort out its interface and aggressively market itself as a genuine alternative

Where did I say it was good news?

They aren't particularly worried about big winners, they are more worried about people arbing.

Also they are in the business of making money, so not suprising thats what they want to do.

 

[fundy]

worried about arbing? really? they are worried about courtsiders and fast pic merchants who are clearing 6 figures + a month and this money is being taken directly out of the betting pool and not being recycled.

introducing the pc charge gave them a chunk of this pie rather than addressing the issue and they are now just getting greedier in exploiting an almost monopolistic position

that is still only part of it, the bigger issue is trying to justify a stock market listing as a tech/growth company whereas actually they are a niche company who have all but fully exploited their niche

 

[surefire]

worried about arbing? really? they are worried about courtsiders and fast pic merchants who are clearing 6 figures + a month and this money is being taken directly out of the betting pool and not being recycled.

introducing the pc charge gave them a chunk of this pie rather than addressing the issue and they are now just getting greedier in exploiting an almost monopolistic position

that is still only part of it, the bigger issue is trying to justify a stock market listing as a tech/growth company whereas actually they are a niche company who have all but fully exploited their niche

As far as I understand it, the premium charges are there to target people who are trading, making profit whilst keeping commission charges low.

Surely profitable courtsiders, who weren't reinvesting, wouldn't be making enough losing bets to reduce their commission charge enough?

Also any single win that constitutes 50% of you gross profits isn't affected by the charge. So someone who punts, wins big and then leaves, would still be able to do that without getting hit by the premium charge.

I agree on the stock market side of things though.

Once again though, I don't think it's good, but whilst they are as dominant in the market as they are, they can get away with it. I really don't see this being their death.

 

[timgolfy]

As far as I understand it, the premium charges are there to target people who are trading, making profit whilst keeping commission charges low.

Surely profitable courtsiders, who weren't reinvesting, wouldn't be making enough losing bets to reduce their commission charge enough?

The PC was introduced because the rate of commission paid to total profits was considered too low for some customers.

Customer A: 10 markets and £10 profit on each = £100, less 5% on each = £5 commission on £100 profit.

Customer B: 10 markets with £900 losses and £1000 wins = £100 profit, but commission is 5% of £1000 = £50.

So same profit, but Customer A has paid £5 (5%) and Customer B has paid £50 (50%).

The PC was designed to ensure that everyone paid at least 20%. The new Super Premium Charge takes that to 40%, 50 or 60%.

Re the future: The future of Betfair is unclear now. Over the past few months senior executives have been leaving in droves, and now the board has the city to please it seems to be taking short-term profiteering decisions at the expense of long-term positioning. The two main USPs of Betfair was better prices and it's non-banning of winners ("we like winners"). No longer the case, since what point is better prices if you pay 60% commission? And effectively this will force many professionals out of business. So both USPs have been obliterated.

It may be a hard-nosed business decision, but it's short-sighted and designed solely to impress the city. The only viable alternative at the moment is Betdaq, but liquidity for many markets there is poor (and most of that is probably mirroring Betfair's).