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BETFAIR are to increase the charges on their most successful users to as much as 60 per cent of gross win next month in a move the betting exchange claim will protect smaller players using the site.
FromJuly 18, Betfair will crank up the controversial premium charges faced by big hitters whose lifetime net profits exceed £250,000, who bet in over 1,000 markets, and whose commission generated is less than 40 per cent of their lifetime gross profit.
Betfair introduced the premium charge in September 2008 at 20 per cent, claiming it would cover costs incurred in providing the most successful punters with the platform to profit – the majority of which comes through trading and in-running punting.
At the present level, Betfair, who believe only 0.1 per cent of their 3.8 million registered users will be affected, claim to break even on the highly profitable users, but state that profits from elsewhere are ploughed into improving the site to meet levels of trading from big punters and advertising to attract new customers to maintain liquidity in the markets.
A spokesman said: “Betfair believes that the implementation of the adjusted charge will provide the business with fair compensation for the service it provides to those impacted customers, who currently pay a rate of commissions and charges that does not reflect the benefit they gain from the Betfair ecosystem.
“We have evolved our pricing model to ensure we have a fair pricing structure for all of our customers, over 99.9% of whom are not affected by this adjustment.
“Since inception we have provided customers with a unique and innovative product that has consistently offered them, on average, the best value on the market. This is still very much the case and we’re committed to ensuring that it remains the case for years to come.”
So, that’s alright then.
If their Chief Executive changed his name from David to Frank, he could sign this press release and express his opinion of his customers at the same time.
AP
BETFAIR are to increase the charges on their most successful users to as much as 60 per cent of gross win next month in a move the betting exchange claim will protect smaller players using the site.
FromJuly 18, Betfair will crank up the controversial premium charges faced by big hitters whose lifetime net profits exceed £250,000, who bet in over 1,000 markets, and whose commission generated is less than 40 per cent of their lifetime gross profit.
Betfair introduced the premium charge in September 2008 at 20 per cent, claiming it would cover costs incurred in providing the most successful punters with the platform to profit – the majority of which comes through trading and in-running punting.
At the present level, Betfair, who believe only 0.1 per cent of their 3.8 million registered users will be affected, claim to break even on the highly profitable users, but state that profits from elsewhere are ploughed into improving the site to meet levels of trading from big punters and advertising to attract new customers to maintain liquidity in the markets.
A spokesman said: “Betfair believes that the implementation of the adjusted charge will provide the business with fair compensation for the service it provides to those impacted customers, who currently pay a rate of commissions and charges that does not reflect the benefit they gain from the Betfair ecosystem.
“We have evolved our pricing model to ensure we have a fair pricing structure for all of our customers, over 99.9% of whom are not affected by this adjustment.
“Since inception we have provided customers with a unique and innovative product that has consistently offered them, on average, the best value on the market. This is still very much the case and we’re committed to ensuring that it remains the case for years to come.”
So, that’s alright then.
Credit where it’s due, Librettist. It moves you to tears when Big Business puts the little guy’s interests above its own; wrings your withers.
I expect there was a wee soft spot in Milton Friedman’s heart for Pinochet’s Chilean victims, too.
Ecosystem is OK in in English when related to biology and environmental sciences. I assume it’s not English usage but pratt-speak.
I have heard that the government will be introducing a white paper to make a special case of Betfair. Since it is by far the largest player, with the largest turnover, in the betting exchange market, all their executives will have their income taxed at a special 60% rate. The company will also pay 60% corporation tax on gross operating profits. This will only affect 0.000001% of executives and 0.0001% of companies in the UK. This will enable the government to help out all the lower earning people and companies in the UK. They have yet to say if any of the extra revenue will find its way into the horseracing industry.
The Betfair Ecosystem
http://niepoprawni.pl/files/images/0057_3252_3712_070.preview.jpg
The identity of the two characters depicted in the boat has been the subject of much scholarly conjecture but is generally thought to represent Paul Roy ‘the oarsman of the apocalypse’ and David Frank-Yu. David seems more than happy with his catch, but Paul’s gesticulation suggests he’s asking ‘where’s mine gone’
"David seems more than happy with his catch".
Getting, out before all the fish have gone:-
http://www.independent.co.uk/news/busin … 03753.html
Regards
Its hard to fathom any company shooting itself where it hurts, this is plainly wrong IMO, if ever anybody had a reason to play on other exchanges the time is about right to do so now
Surely the other exchanges will increase liquidity as a result of this change
Mr Roy your shares are looking a bit dodgy now , but dont worry markets have a knack of finding the right price eventually
I know most of the big players paid the 20 per cent on sufferance as the liquidity was very weak on competing sites , but 40-60 per cent is just a chunk too far
Ricky
Be interested to see how liquidity holds up from now on, I’m still of the opinion that exchanges will ultimately run out of layers. Will Betdaq now embark on a more aggressive campaign to grow there business.
I don’t think it’s unreasonable. I would guess most of these big hitters are not shrewdies in the traditional sense but people using automated systems to scalp money off thousands of minor anomalies. It probably costs Betfair a fair amount to process all their transactions. I don’t think they will go anywhere else because there is no liquidity elsewhere.
I noticed Liquidity is worse on Horse Racing in the past Month. Many race dont even have 3/4 Million euro matched before the off in the UK where usually they be up near 1 million.
Tennis however is a incredibly liquid market but i guess its because of the trading abilities that are their and not in Horse Racing.
Betfair have been poorly run and have not grown into new markets which makes their current market price fairly sound investment. Once they get a proper ceo they should be okay but hitting big hitters and taking liquidity out of the markets is not a good idea IMO.
We have evolved our pricing model to ensure we have a fair pricing structure for all of our customers, over 99.9% of whom are not affected by this adjustment.
Yes, because 99.9% of customers don’t win. The lesson is ‘If you are a winner, we want the major cut of your takings’. It makes BF sound like a bunch of pimps, they pay for the hotel room and take 60% of the proceeds. Shocking stuff.
We have evolved our pricing model to ensure we have a fair pricing structure for all of our customers, over 99.9% of whom are not affected by this adjustment.
Yes, because 99.9% of customers don’t win. The lesson is ‘If you are a winner, we want the major cut of your takings’. It makes BF sound like a bunch of pimps, they pay for the hotel room and take 60% of the proceeds. Shocking stuff.
And that is the public relations disaster of a message that effects 100% of punters and 100% of prospective punters.
Anti-Betfair countries will also ram that down their throats should they venture further overseas.Someone will take advantage of this very foolish decision but it won’t be Betdaq or WBX who are a waste of time it’ll be something that doesn’t exist presently. Some innovator somewhere with boldness and daring will see a great opportunity from this.
Camelot own and run the terminals that enable you to bet on the Lottery, but they don’t ask for £600k if you win £1m.
What Betfair are doing is nothing short of legalised theft of legitimate winnings. Liquidity will dry up and people will slowly migrate elsewhere when they realise that they can’t make it pay, and if they do BF puts them back to levels again.
I can’t imagine why anyone would use an operation that expects to take your winnings when you get a system going. You lose, they win. You win, they take the winnings and you still lose. The best bet is not to play.
Betfair is a good example of capitalist greed at it’s finest. They are killing the golden goose for short term potential gain and will end up with egg on their face.Seems a bit of an over reaction by some to this.
Any company/individual in any market of whatever commodity/service that is making abnormal profits should expect that the abnormal profits will be limited in time due to either others entering the market or market regulation or both.
I’d guess those affected by this have expected some form of regulation for sometime and will adjust and adapted accordingly.
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