That tie-up followed last month’s all-share deal between Ladbrokes (LAD.L) and Gala Coral to create a 2.3 billion pound bookmaker group.

A source close to GVC told Reuters this month that some of Bwin’s earlier questions were focused on potential cost savings.

GVC had said on Monday that it expected to resubmit a proposal to the Bwin board in the near future and on the same terms made on Aug. 7.

GVC looked to have lost the race for Bwin after it accepted a 900 million pound cash-and-stock offer from 888 (888.L) in July, but the Sportingbet owner has since returned with two improved proposals to hijack the deal. In July Bwin said 888′s offer carried fewer risks than GVC’s, which was made in conjunction with Amaya Inc (AYA.TO).

Bwin’s share price gained 0.5 percent by 0916 GMT, with GVC and 888 up 2.7 percent and 1.3 percent respectively.

Bwin and GVC have since been in talks over the terms of that proposal and Bwin said on Thursday that it is satisfied that key aspects have now been addressed.

The Bwin saga is part of wider consolidation in the gambling sector, which has brought a string of deals this year as firms respond to higher tax bills in Britain and tighter regulation by looking to bulk up and better compete in an online market. 7.

LONDON Online gambling company Bwin.party (BPTY.L) has asked GVC Holdings (GVC.L) to table its best offer for the business after the duo addressed key concerns over the suitor’s latest 1 billion pound ($1.55 billion) approach.

(Editing by David Goodman)

“Bwin.party has now asked GVC to clarify, with respect to its proposal, the best terms on which GVC is prepared to make aformal offer to acquire all of the issued and to be issued shares in bwin.party,” a Bwin statement said.

GVC has since dropped Amaya and now has backing from U.S. private equity firm Cerberus Capital Management.. SECTOR CONSOLIDATION

Bwin said that its board’s unanimous recommendation of 888′s offer was unchanged by this announcement.

On Wednesday Betfair (BETF.L) and Paddy Power (PLSA.I) agreed in principle to a 5 billion pound merger, sending their shares soaring. Its latest was a 1.03 billion pound offer on Aug

My longest streak was seven in a row and my girlfriend had 11 in a row during basketball season. Each day you can make one pick from a list of games that Covers.com chooses. If you get it wrong, your streak resets to zero. We have found that during basketball season it was much easier to find a good pick than it has been during baseball season.

The ultimate goal is to build a streak of 24 correct picks for the overall grand prize of $100,000. If you get your pick correct, your streak goes up. Basketball and football include picking ATS (against the spread), which makes Covers.com the closest thing to actually betting on sports on this list.

Only having the option of picking one game a day makes this contest one of my favorites. Other prizes are available for smaller streaks. You do not have to pick everyday, but you must pick once every six days to keep your streak alive.. It doesn’t take a lot of time and it is a contest that a smart sports fan has a reasonable shot at winning. Many of the picks are not just picking which team will win. See the table to the right for a breakdown of the prizes.

Covers.com is a sports betting information website that runs a free streak style contest with a top prize of $100,000

With a Remington steel hybrid frame, Promax Linear pull brakes and a Deluxe Hybrid seat, this bike has also received very favorable customer reviews. A hybrid bike combines features of both a road bike and a mountain bike. They tend to vary quite a bit in price, and you get what you pay for. They are okay for occasional riding in your neighborhood, or for commuting to and from work as long as it is an easy commute. It has an aluminum frame and is ideal for commuting about town as well as for riding on trails. Customers mentioned that it is a solid, smooth ride with very smooth gear shifting.

Some of the other bestselling hybrid bikes on amazon are:

The Lamborghini Urbano Mens Comfort Hybrid Bike

The Schwinn is one of the most popular mens hybrid bikes on amazon.com. Customers have generally been very pleased with it, although some have recommended getting a few inexpensive upgrades and customizations done at a bike store, especially for the brakes and the gears, to get even more out of this bike.

The Schwinn Crest Urban Men’s Hybrid Bike. This makes it more comfortable for everyday riding than a road bike, as you do not have to sit in a hunched position while riding it. It is also very inexpensive at $265.00. You can get a good quality hybrid bicycle this way for much less than you might pay for a new one.

Frames for hybrid bikes

The best hybrid bikes will have frames that are made of airplane grade aluminum, also known as T-6 grade aluminum. Does a hybrid bike fit your needs? Keep in mind that while it is more versatile than either a road bike or a mountain bike, either of those is better for the environment it is specialized for. Where can you buy the best hybrid bicycles for men?

You can find hybrid bikes for men on sale at most sporting goods or shopping websites like Amazon.com. You can tell that a frame is of this type because it will have the number 6061 etched on them. A used hybrid bike might be a good compromise if you buy it from a trusted source. Big box stores, including Wal-Mart and Target, will often sell mens hybrid bikes for very cheap (around $100). If your main interest is for recreational riding off paved roads, then you might be better off with a mountain bike. It has an SR Suntour suspension fork that allows for comfortable riding, 21 speeds, 700c wheels, a swept back handle bar and a padded saddle. You could expect to spend a few hundred up to even a couple thousand dollars for a really high end bike. But for road racing, you are better off with a road bike. But because hybrid bike tires are fat like tires of mountain bikes, they allow for good traction while biking off-road or on trails.

The best hybrid bicycles

While there are specialized hybrid bicycles for women, most of us can probably get by with a unisex or mens hybrid bike. Chances are such bikes will also wear out more quickly. However, a hybrid bicycle will help you get the best of both worlds, and often for a much lesser price than you might pay for either a road bike or a mountain bike.

Schwinn Midmoor Men’s Hybrid Bike

The Diamondback Kalamar is another very reasonably priced and popular hybrid bike for men, retailing on Amazon.com for about $270.00. Womens hybrid bikes tend to me shorter than hybrid bicycles for men. A specialty bike store or sporting goods store is a better bet for finding a more expensive, albeit better quality hybrid bike. While a hybrid bike frame resembles that of a road bike, its handlebars are like those of a mountain bike, being straight rather than curved. Cheap hybrid bicycles will have low grade aluminum frames, such as the 7000 series frames.

The best hybrid bicycles for men on Amazon.com

The following are some of the bestselling and best rated hybrid bikes for men on amazon.com:

The Diamondback Menona Men’s Sport Hybrid Bike

Diamondback Kalamar LX Men’s Sport Hybrid Bike

Hybrid bikes are ideal for people who want the flexibility of being able to ride the bike on their daily commutes, as well as for some recreational riding on weekends. However, these bikes tend to be quite heavy

From collecting stamps, and coins to cars, and sporting memorabilia these are purchases that bring joy. Interested in what women spend there money on? Click here to see the top 5 things that women tend to spend their money on.

Investments

Whether its investing in bonds, stocks, property, or art men are more confident to spend their money on investments more than women are. It provides them with things they love; adrenaline, risk, competition, and rewards.

After the usual bills, and aside from their children, here are the top 5 things that men tend to spend their money on. They will splash out on the latest electronics, televisions, and gadgets, and spend up large on travel, and sporting events.

Women, Love and Online Dating

Men see finding love and companionship as important as women do, and they are willing to hand over their hard earned cash to find “the one”. Men have a need to keep accumulating wealth and are happy to invest for the future of their families.

Entertainment

Men are willing to pay for high end, state of the art products to keep them entertained. A man’s need to invest also helps fuel some of these purchases.

Gambling and Betting

The gambling industry offers a playground for men. Often men end up dipping into their pockets to pick up dinner, coffee and movie tabs.

Sports and Hobbies

Men are happy to spend money on hobbies and sports to gain enjoyment. Men spend their money in this playground placing wagers on sports teams, gambling on horses, and trying to beat the house at casinos.

Scientific American, 298(3), 38-45.

Griffiths, M. Figure 4 shows the home-countries of 21 of the major betting exchanges.

Betting exchanges themselves regularly claim they offer customers up to 20 percent better odds than the online bookmaker. (2005) write, “experts today generally agree that Moore’s Law will continue to govern the industry for another fifteen years, at least.” As processing power continues to grow, new innovations will be made possible. As Pitt et al. (2005) puts it,”even with a valid betting slip, the bookmaker is not obliged to honour a winning bet.” Mainelli and Dibb (2004) conclude that in the absence of legal enforceability, the concept of trust is essential in the betting industry. . (6) In analyzing the role of the betting exchange in reducing transaction costs, the focus should be on search and information costs.

Match fixing

Recently, a new type of betting market has appeared, where punters bet directly with each other (peer-to-peer betting). Although a betting exchange can in theory offer a payout of 100 percent to its customers, commissions on winnings (especially if these commissions amount to as much as five percent) will make it likely the betting exchange in practice will not be able to offer better odds than the discount-bookmaker. Economica, 73(292), 673-689.

Buchdahl, J. According to Laffey (2005) “Betfair have stated that for some events they have matched up to ten times more in-play than beforehand, showing the appeal of this product.”

Since the beginning of sports betting, there have been many examples of bettors trying to influence sporting events to secure a favorable outcome. (23) During the U.S. presidential elections of 2008 neither presidential candidate showed an interest in repealing the Act, and in November 2008 the Federal Reserve Board and Department of the Treasury announced the release of a final joint rule, forcing U.S. By expanding the offering to customers, the betting exchange hopes to not only increase the total number of customers, but also to increase the spendings per customer.

Wood, G. The functional form of network effects. Information Economics and Policy, 14(3), 417-429.

Dahlman, C. According to Mark Blandford, founder of online-bookmaker Sportingbet, the average bet size of their Australian and Asian customers in 2003 reached an impressive 226 per bet. In the United Kingdom bookmakers need to apply for a (costly) license to operate legally, and also pay 15 percent tax on their winnings. (17) For that reason a number of betting exchanges have already started offering their customers the possibility to play poker, blackjack, and casino games through their own website. The tool of a SWOT-analysis is not new, of course, but this particular application is. Griffiths also suggests the concept of electronic money will likely not be perceived to have the same value as real cash, which could cause the bettor to risk more money than he would have done in the offline world.

(26) Source: http://www.pinnaclesports.com

For now, Australia and especially Asia are pretty much unexplored territory for betting exchanges. Australian bettors showed a tendency of betting up to 5.5% of consumer spending, while Asian bettors were inclined to bet 1.8%. J. To the dismay of the bookmakers’ lobby, at that time the British government decided to ignore the advice of the commission, because of practical problems implementing the proposed measures. (2005) argue an important strength of the betting exchange consists of the fact the betting exchange considerably reduces transaction costs in comparison to the bookmaker. Musumeci and Peterson calculated that a bettor betting on an event with two equally probable outcomes would need to win 52.4% of his bets to break even with a typical bookmaker, while a winning rate of “only” 51.2% would suffice to break even while betting with Pinnacle. (2006) the popularity of gambling through the internet is becoming more and more of an issue for concern regarding problematic gambling behavior. In live-betting it is possible for bettors to not only place their bets at the exchange before a game starts, but also during the game as the match is being played. In fact, some sports derive their very existence from the popularity of its associated betting market (e.g., horse racing). & Strickland III, A. (30,31) The company has obviously benefited greatly from its first mover advantage, and has since its founding never allowed any threat to its leading position. Betting exchange chief loses 1,1m[pounds sterling]. (21,22) Despite national and international concerns (e.g., Shaker, 2007), as well as a ruling by the WTO indicating the Act is in fact in violation of existing free trade agreements, it doesn’t seem likely the United States government will be taking action to overturn the Act soon. Online exchange rocks sports betting. Strategic management (12th ed.). (19) Not unexpectedly share-prices of publicly traded betting companies lost up to 70% of their value following the news of the Act. The economist intelligence unit and Merrill Lynch, Sportingbet Annual Report. Potential customers will for that reason be less inclined to join that specific exchange. In comparison, the average bet size of European and American customers over the same year amounts to ‘only’ 22 and $59 per bet respectively. The figure shows the payout offered by six differentmajor betting exchanges (Betdaq, Betfair, BetonBet, Betsson, IbetX,Parbet, and TradeBetX), as well as the average payout offered on averageby a sample of up to 72 different bookmakers (“Bookm. Therefore, it is difficult to make an accurate estimate as to the worldwide size of the betting exchange market. However, this is not the only reason. It writes in its annual review of 2006 “a series of ‘MoUs’ (Memorandum of Understanding) have been signed with sports bodies over the year.” These Memorandums, which Betfair has signed with among others, the Jockey Club (horseracing), the ICC (cricket), the FIFA (soccer), and the ATP (tennis), include Betfair reporting suspicious betting patterns to the relevant sports governing bodies, thereby making an investigation into match fixing possible (which has already led to several suspensions and lawsuits). Aiding betting. As Mainelli and Dibb (2004) comment “liquidity, once established, is hard to shift.” For obvious reasons, a start-up bookmaker does not face any of these liquidity problems, because the bookmaker is by definition the only party making offers on its own betting platform, regardless of the number of customers.

Furthermore, the analysis showed a number of interesting future growth opportunities; for example, the possibility to expand the product offering with other gambling related products, but also identified a number of factors that seriously threaten the position of the betting exchange, like entry to the market by much larger online bookmakers. Furthermore, it is worrisome several very important opportunities and threats that were identified the betting exchange itself has little control over, since these are of a legislative nature, like, for example, the gambling laws in both the United States and the EU member states.

(24) Source: http://www.casinoonline.co.uk/articles/ us-presidential-elections-race-gambling

Dey, E. According to Davies et al. (2005). However, the company decided to close down its betting exchange in October 2007. These findings differ significantly from the rest of the world. The propensity to bet in the United States amounted to 1.0%, in the United Kingdom to 0.9% and in the rest of Europe to ‘only’ 0.4%.

In Figure 5 these betting exchanges have been compared on a number of important characteristics, with regards to commission charged on winnings, reliability, legal issues, and product offering.

(32) Source: http://quote.bloomberg.com/apps/news?pid=nifea&& sid=a8Y11XQeIcyY

In 2003 the CEO of Betfair, Stephen Hill, told British magazine New Media Age in an interview he doesn’t see Betfair as a gaming company, but mainly as a “internet technology company.” Hill announced in the interview he plans to take Betfair “into entirely new areas of business.” He emphasized the technology that is needed to run a betting exchange, could be used for several other internet concepts that are completely unrelated to gambling; for example, an online auction site.

Shaker, P. New Betfair CEO keen to expand business areas. The odds were taken from the Match Winner-market, with three possible outcomes: home win, draw, and away win. A first move was made by Betfair, which managed to acquire a license to enter the strictly regulated Australian betting market in the beginning of 2006. However, any measures taken by member states must be necessary, proportionate, and non-discriminatory. According to a study ordered by the European Commission and published in 2006, members states that restrict sports betting must have a ”desire to bring about a genuine diminution of gambling opportunities.”

The rise of the betting exchanges has not gone unnoticed by their main competitors, the bookmakers. NMA Magazine.

Betting exchanges are also expanding into other gambling products, completely unrelated to sports betting. Applied to the case of the betting exchange, Metcalfe’s Law predicts that the more users a betting exchange has, the more offers will be made, and the bigger the chance will be that any individual player at that exchange will find a reasonable offer to his liking. Betting on the future: Online gambling goes mainstream financial. According to gambling-review website Bookmakersreview.com in August 2007 there were 31 different online betting exchanges in business. (2006). (2003, October 18). However, beside there being no guarantee the British government in the future will not again attempt to tackle these practical problems, it remains unknown how other countries in the world will decide and possibly impose restrictions regarding this subject.

Strengths

After reviewing the business climate for the betting exchange sector as a sector, in the this section the major betting exchanges worldwide will be identified individually and compared on a number of characteristics. (11)

Since the betting exchanges have not been around for long, unlike some of the online bookmakers who have a long history of offline bookmaking behind them, the possibilities for building a decent track record have been limited. An example of an expansion into sports betting-related products is the offering of live-betting. For example, the Dutch newspaper De Volkskrant started an exchange during the Dutch elections of 2006, by using technology of American exchange solutions supplier Newsfutures.com, to help predict which party would win the elections. Also, betting exchange Intrade has focused exclusively on offering its customers prediction markets on current events.

Individual Analysis

(11) Source: http://www.eubusiness.com/Competition/1182952802.06/

(6) Dahlman has based his study on the work of Coase (1937), who first introduced the concept of transaction costs.

As can be seen in Figure 5 most betting exchanges are privately held and do not disclose financial information. A few examples can be found at: http://www.betbull.com/UI/Default.aspx, https://secure.betonbet.com/portal/default.aspx?Redirect=1, and http://www.betfairpromo.com

(18) Source: http://www.usatoday.com/news/washington/ 2006-10-02-internet-gambling-usat_x.htm

(7) Source: http://networks.silicon.com/webwatch/ 0,39024667,39125945,00.htm

Less restrictive legislation (Europe)

Expansion to related sectors

Firstly, the sector-analysis is performed by making use of a SWOT. The analysis shows the betting exchange has a number of unique strengths over the “traditional” bookmaker, like, for example, the ability to offer better odds to customers. There is no reason why the same mechanism should not also apply to betting markets, which is also consistent with findings concerning a study about betting exchange market efficiency by Smith, Paton, and Vaughan Williams (2006).

Endnotes

United Kingdom Parliament. Journal of Economic Literature, 26, 2021-2064.

It is clear Betfair’s competitors will have to come up with something special to be able to survive in the long term. (2005) Metcalfe’s Law, a law related to the concept of network externalities, is an important factor to explain the success or failure of a certain betting exchange. A “complete market” is defined by Figlewski and Webb (1993) as “one in which, for each possible state of the world, an investor can create a strategy that has a positive pay-off in that state and zero in every other state.” Although Figlewski and Webb admit markets are ”bound to remain far from complete”, they have found, while studying traditional financial markets, a higher level of market completeness tends to improve market efficiency. Smith, M. Retrieved January 11, 2003, from http://cjonline.com/stories/110103/bus_betting.shtml

(14) For example: http://www.betbull.com/HelpCentre/help_centre.htm# mobile_site.htm

(25) Source: http://www.federalreserve.gov/newsevents/press/bcreg/ 20081112b.htm

Unlike a bookmaker, the task of the betting exchange does not include actively monitoring a certain market. The payout offered by betting exchanges was revised for the commission on winnings betting exchanges charge their customers, which is necessary to be able to make a fair comparison.

Jones, P., Hillier, D., Turner, D., & Comfort, D. In the earlier intervals, when the match is still a relatively long time away from kicking off, payout varies from betting exchange to betting exchange and in some cases is below maximum, and even below average payout offered by bookmakers. Betfair has therefore decided to take matters into its own hands. (2005, January 7). It is likely this will remain to be the case for as long as American citizens are not allowed to bet using these betting exchanges.

(1) Source: http://www.ey.com/global/content.nsf/UK/EOY_-_Awards_Recipients

(5) The results of the complete study is available upon request.

Bart van Velzen obtained a master’s degree in economics from the University of Groningen in 2007. Rather than trying to copy the Betfair business model, it also seems likely individual betting exchanges that will survive in the long term are the ones who will actually succeed in being different.

After identifying a number of important strengths of the betting exchange in the first part of this section, especially the important strength of better odds, it raises an important question as to why online bookmakers continue to be profitable, despite the arrival of the betting exchange. Pinnacle manages to offer it customers payout books of 0.976. Also, in some cases of bankruptcies, other betting exchanges have stepped up to help victimized customers. Like betting exchanges, Pinnacle uses the argument of better odds as its main selling point to attract new customers, advertising on their website with slogans like “we take on the high margin operators” and “Pinnacle is where the pros play.” (26)

Hoare, S. If a bettor would question the reliability of a betting exchange, he might very well prefer to keep on betting with the bookmaker he has been betting for years, if that bookkeeper is perceived to have a lower counter-party risk. Especially Asia offers huge growth potential, if simply because of the enormous size (and growth) of the population. (2004) writes about the betting exchange “the odds on offer are generally much more competitive.” Griffiths (2005) confirms this statement, “they [the betting exchanges] provide excellent value for the gambler. Similar to the model of a stock exchange, the user can buy (‘back’) or sell (‘lay’) bets at the price (‘odds’) he or she wants. Most bookmakers will soon limit their maximum stakes for this particular kind of customer and he will therefore typically only be able to bet small amounts. To make matters worse, some betting exchanges (e.g., Sporting Options and Play121) have had to file for bankruptcy in recent years, while others (e.g., Back2Bet and The Soccer Exchange) have vanished, taking the funds of customers with them.

Musumeci, J., & Peterson, M. Mainelli and Dibb (2004) predict “a future with exchange(s) at the centre as mechanism for price formation.” As the concept of the betting exchange will become more and more familiar to the big public and will keep on growing in size at the expense of the bookmakers, it is not hard to imagine this will attract outside interest. Another betting exchange, Matchbook, does appear to have been successful in creating a unique selling point. Traditionally, betting markets have been cleared by bookmakers, who accept (or not) the bets on a certain event. America’s bad bet: How the unlawful Internet Gambling Enforcement Act of 2006 will hurt the house. Pinnacle, as well as a number of Asian-based bookmakers with a similar business model, and can best be described as a ‘discount-bookmaker’ since the company has managed to offer extremely competitive odds on almost every sport. (2002). There is no [...] bookmakers’ mark-up on odds.” A study by Ozgit (2005) that compares the returns of Betfair to the return of two bookmakers also showed considerably higher returns, although the sample chosen by Ozgit in his study was admittedly limited.

(15) For example: http://forum.betfair.com/

A fundamental advantage of the business model of the betting exchange to the business model of the bookmaker is the fact the exchange (normally) is not a party in any of the betting transactions that take place on their website. UNLV Gaming Research & Review Journal, 10(1), pp 27-39.

It seems likely, due to reasons of liquidity, the future will only have room for a very limited number of betting exchanges. As a consequence of the competitive odds Pinnacle is offering, Musumeci and Peterson conclude “Pinnacle’s margins are smaller.” These smaller profit margins are responsible for the fact the discount-bookmaker is, like a typical betting exchange, very dependent on volume to survive and therefore needs to attract not only a large amount of customers, but also attract professional bettors, who will typically shop around to find the best odds available for a certain event. (2003, September 29). Retrieved October 4, 2006, from http://207.36.165.114/NewOrleans/Papers/5701876.pdf

(23) Source: http://www.gambling911.com/WTO-Antigua-Ruling-033007.html

The suspicion of match fixing is of course particularly damaging to the public image of the betting exchange. However, although the online betting industry is showing its willingness to fight the problem, gambling addiction not only poses an important threat to the image of the betting industry, but could also in the future remain the most important reason for national governments worldwide to restrict their citizens the possibility to gamble online.

However, Metcalfe’s Law can also be applied the other way. Fordham Journal of Corporate & Financial Law, 12, 1183-1203.

[FIGURE 4 OMITTED]

Betting companies complain this desire from national governments is clearly lacking, as state betting operators often even encourage gambling by making use of aggressive advertising campaigns. To underline the potential, according to the previously mentioned study ordered by the European Commission, in 2003 the gross gaming revenues, the winnings of the operator minus payments of prizes, in European member states reached a level of approximately 51.500 million (compared to 60.700 million in the USA), of which 17.2% was generated in activities related to sports betting.

Stanley, B. Any other betting company is restricted from offering betting services to the citizens of that country, and risks legal action if the company does not comply with national regulations. Study of gambling services in the internal market of the European Union. According to Jones et al. (18) While betting through the internet, as in many countries, has always been a ‘grey area’ in American law, and rules on gambling vary greatly from state to state, the American betting industry has shown enormous growth in the last couple of years. The Unlawfull Internet Gambling Enforcement Act has effectively created a protected market for Matchbook. D. The most notable example of this is the rescue package offered by Betfair, after British betting exchange Sporting Options had to cease operations. Because the Gambling Enforcement Act, that came as a big surprise to the betting industry, makes it almost impossible for bettors to deposit or withdraw winnings from their betting accounts, industry experts believe the Act could mean the end of most of the off-shore online American betting industry. American betting exchange Betbug had already decided to cease operations in February of that same year, while TradeBetX ceased operations in November 2008.

(30) Source: http://www.smh.com.au/news/business/ betfair-out-to-conquer-the-world/2006/02/05/1139074110158.html

In many European countries it is only possible to bet on sports through a state-owned subsidiary. customers. In 1998, online bookmaker Pinnacle Sports was founded, a company that operates from the Netherlands Antilles. The liberalization of the European betting market would offer a great growth opportunity for the entire betting industry, including the betting exchanges. Science News, 164(16), 251-253.

The internet itself, the channel through which the betting exchange operates, has worldwide already become an accepted factor in the daily life of many people. Options, short sales and market completeness. Draft gambling bill joint committee reports. To be able to make a definitive statement as to when to what extent the betting exchange offers better odds than the bookmaker, more research is needed.

Sauer, R. This can be explained by the fact that a bet placed with a bookmaker, in almost every country in the world, is very hard to enforce by the bettor. Ozgit (2005) calls the fact “bookies attract a lot of betting although better returns are available elsewhere” the ’bookie puzzle.’ A solution to the bookie puzzle could very well be bettors’ aversion to risk. However, it’s a different story for a customer that manages to ‘beat’ the bookmaker by actually making a profit in the long term. Issues like competitiveness and survival of betting exchanges are addressed. Given the very dominant position of Betfair, it seems unlikely the much smaller betting exchanges copying Betfair’s business model will succeed, since it is impossible for them to match the liquidity Betfair’s customers are used to. Betting exchanges that are successful in finding niches around Betfair, for example, by charging significantly lower commission to make up for the loss of liquidity, or focusing on different sports altogether, seem to have a better long term possibilities for survival.

Although the European Commission is quick to emphasize in press releases this investigation as such has no implications for the liberalization of the sports betting market, it does seem to be a small step in that direction. Metcalfe’s Law predicts that network value is proportional to the size of the network, and that individual user’s utility is a linear function to network size (Swann, 2002). www.betfair.com: World wide wagering. (2003). (2002). (10) While most of these investigations are still under way, some of the member states have already been threatened in 2007 by the European Commission they will have to face legal action before the European Court of Justice if they do not change their gambling laws in the very near future. writes “simply provides the platform.” The concept of the betting exchange can therefore significantly reduce search and information costs (and therefore also reduce total transaction costs), in comparison to the traditional bookmaker.

Ozgit, A. In this study odds offered by a large sample of bookmakers were compared to odds offered by betting exchanges in different intervals during every fixture of four major sporting events in 2006 (World championships soccer, ice hockey and floorball, and the European u21 Championships soccer). Betfair was launched in June 2000 by Andrew Black, a professional gambler, and Ed Wray, former vice-president of JP Morgan. It’s therefore essential for the betting exchanges to gain the trust of the bettors. Laffey (2005) writes “its [the betting exchange] main innovation was that it allowed users to set their own fixed odds against an outcome [...] something which had previously been the preserve of bookmakers.” According to Davies et al. Bettors’ aversion to risk

According to Dahlman, this factor only exists as a consequence of ”imperfect information about the existence and location of trading opportunities or about the quality or other characteristics of items available for trade.” In sports betting traditional bookmakers also incur search and information costs. (20)

Introduction

Sports and betting have always been strongly connected. Most of these exchanges are based in Europe, either in the United Kingdom or Ireland, or in tax-friendly locations like Gibraltar or Malta. The results of the SWOT-analysis of the betting exchange are shown on page 44.

Whereas online betting companies have previously targeted Europe and the United States as their primary sales region, Asia and, to a lesser extent, Australia, seem to have been overlooked up until recently. In economic literature Dahlman (1979) identifies three different types of transaction costs: search and information costs, bargaining and decision costs, and policing and enforcement costs. (2004). (1993). (15) Also, betting exchange Betfair has recently started an experiment offering customers free live-stream coverage of football and tennis matches through its website. Fixed odds sports betting. His research interests include competitive balance in sports, market efficiency, and applied econometrics applied to sports phenomena.

(3) The claim of “up to 20% better odds” is made regularly by different betting exchanges. sports, also Betfair, and other betting exchanges, are still accepting bets on, for example, NBA basketball, NFL football, and MLB baseball placed by their non-U.S. Economists explore betting markets as prediction tools. (2)

Less operational risk

(31) Source: http://en.wikipedia.org/wiki/Bet_exchange

Most authors agree the most important strength of the betting exchange is they offer customers better odds than the online bookmaker. Jones et al. Market efficiency in person-to-person betting. Scotland on Sunday, p. CyberPsychology & Behavior, 6(6), 557-568.

A British parliamentary commission investigated this issue in 2004 and overthrew the argument of the betting exchanges in their report. They advised the government to start considering bettors that lay a bet at a betting exchange as a bookmaker and therefore to subject them to the same rules. For that reason some agencies start operating their own future predicting betting market to be able to more accurately predict a certain future event. However, the internet has also created many new possibilities for other, related innovations, like the invention of the betting exchange. Some betting exchanges have tried creating a unique selling point by trying to be different with regards to, for example, the percentage of commission charged on winnings. (16)

Lower transaction cost

Swann, G. Retrieved August 26, 2007, from http://www.sportingbetplc.com/90

(20) Source: http://www.bloomberg.com/apps/news?pid=20601087& sid=a6BTLrSohXn0

In October 2006 President Bush signed a law, called the Unlawful Internet Gambling Enforcement Act, which makes it illegal for American-based banks, credit card companies, and online payment systems to process payment to online gaming companies. However, as the match approaches, the payout offered by betting exchanges increases, while the payout offered by bookmakers remains more or less constant. Harpenden, UK: High Stakes.

A SWOT-analysis, which identifies the Strengths, Weaknesses, Opportunities, and Threats, is an often-used tool of situation analysis, and can be used to determine whether a firm’s business position (or in this case, a sector’s business position) is fundamentally healthy or unhealthy (Thompson III & Strickland, Jr., 2001).

Technological progress

Klarreich, E. The company has grown astronomically to become the largest online betting company in the United Kingdom, and has been widely recognized as one of the more successful entrepreneurial innovations of recent times, being awarded the British Ernst & Young Emerging Entrepreneur of the Year Award in 2002.1 Also, in 2003 Betfair won the British Queen’s Award for Enterprise, in the category Innovation. (4)

Figure 3 shows odds offered by betting exchanges are indeed most of the time, but not always, higher than odds offered by bookmakers. com), British (e.g.,http://www.wbx.com), and American (e.g., http://www.matchbook.com)origin. Online betting exchanges: A brief overview. (2005). The managing director of the company told The Guardian in 2005 “it became immediately clear that to develop [it would be necessary] to seed the markets to create liquidity and attain a critical mass of clients to support the business model.” Seeding could indeed be a solution to creating more liquidity at a betting exchange, but needless to say it is also a financially very risky solution. Entrepreneurship and innovation in the UK: Betting industry: The rise of person-to-person betting. Moore’s Law, an observation that dictates that the speed of microprocessors, at a constant cost, doubles every 18 to 24 months, predicts this trend will continue in the future. Retrieved March 25, 2004, from http://www.publications.parliament.uk/

(27) Source: http://www.businessworld.ie/livenews.htm?a=1613598

This paper investigates the situation betting exchanges are currently facing, both as a sector, as well as on an individual level.

(19) Source: http://www.law.duke.edu/journals/dltr/articles/ 2003dltr0016.html

(12) Source: http://www.themanufacturer.com/britishindustry/ content_page.html?article_id=146

“Discount” bookmakers

New entry from bookmakers

Griffiths, M., Parke, A., Wood, R., & Parke, J. (29)

To overcome the effects of Metcalfe’s Law new betting exchanges often try to ‘seed’ their own markets; in other words, to start making attractive offers themselves (and in the process sacrificing the previously mentioned strength of less operational risk). Betting exchange Sporting Options even went bankrupt, partly because of the losses incurred in seeding its own markets. 2004 Financial Management Association International Annual Meeting. (2005, January 9). The problem of externality. The evolution of prices in the 21st Century American football betting market. The betting exchange, for obvious reasons, does not much care whether a customer actually wins or loses; the more money any customer bets, the better. Laffey (2005) writes “this neutral position enables the P2P websites [the betting exchanges] to offer stakes only limited by market liquidity, and to promise not to ban successful punters, something bookmakers would reserve the right to do.” Laffey adds “[the betting exchanges] were drawing in the ‘high rollers’, those prepared to stake enormous sums, who bookmakers would often refuse to take bets from.” Of course, as Laffey emphasizes, also in the betting exchange bettors might not always be able to bet the amount of money they want to stake; not because the betting exchange will limit them, but because it is possible there is simply just not enough liquidity available at the betting exchange to match larger bets at the requested odds.

(9) Source: http://www.eu-ba.org/legislation.html

References

Conclusion

Like many online bookmakers, more and more betting exchanges are investing in broadening their product offering with other gambling products. (2001). Experts agree, however, that Betfair is by far the biggest betting exchange in the world, having obtained a market share that is estimated to be around 90%. (1979). It also shows, however, that the betting exchange is very dependent on customers providing liquidity to succeed, since due to the effects of Metcalfe’s Law a lack of liquidity will make it almost impossible for an exchange to attract new customers, and therefore to survive.

Effects of Metcalfe’s Law

[FIGURE 3 OMITTED]

The previous two threats have shown traditional bookmakers have so far challenged the betting exchanges to both a legislative battle, and by developing a new business model focused on increasing payout. However, bookmakers have not yet challenged the betting exchanges ’heads on.’ The future might be different though. Different forms of betting markets are discussed extensively by Sauer (1998) and Buchdahl (2003).

Many innovations are focused on trying to simulate the environment of the old-fashioned brick-and-mortar betting shop, which to many was (and still is) a social meeting point, but also offered live television coverage of many sporting events. Besides Matchbook, that specializes almost exclusively in offering markets in U.S. Journal of Law and Economics, 22(1), 141-162.

Weaknesses

Better odds/higher average pay-out to customers

Opportunities

Increase of gambling addiction

Migration of technology to unrelated sectors

New markets (Asia/Australia)

Currently, only three betting exchanges, Matchbook, EHorseX, and Intrade, still accept American customers, but will constantly need to keep thinking of (legitimate) ways to being able to accept deposits and process withdrawals from and to American customers. Koning [1] and Bart van Velzen

The EU has repeatedly stated it does allow member states to restrict the access of sports betting operators on a national level, but only to maintain public order (e.g., to prevent fraud), to protect consumers (e.g., to prevent gambling addiction), and to ensure maintenance of the social order. Smart money is on black. By offering customers a one-stop shop for all of their gambling needs, exchanges hope to profit from the growth in other gambling sectors; for example, the enormous growth of online poker. (2005) “with a click of the mouse they [the bettor] can essentially do what Ladbrokes or William Hill [the bookmaker] does.” Also, the bettor has the opportunity to adjust his own betting position at a later time; for example, buying or selling back his own bet at different odds, thereby possibly even securing a profit before the event he was betting on has even started. These practices have always been seen by sports governing bodies as a serious threat to the integrity of sports, but have also been very difficult to prove. The International Herald Tribune Online.

More restrictive betting legislation (USA)

Pitt, L., Watson, R., & Shapiro, D. Lawyer, 16(46), 18.

Also, there’s an increasing interest of polling and news agencies in the exchange-technology. Centre for the Study of Financial Innovation, London.

Laffey, D. (2004). In short, the betting exchange has opened up a whole new range of betting strategies for the bettor, which were not possible while betting with a bookmaker. In combination with a commission rate of the standard five percent, these exchanges are in effect offering customers very little (if not nothing) Betfair is not already offering with much better liquidity. A gambler’s broker. Odds were measured in terms of payout, a number that reflects the percentage of the original amount of money staked a bettor would be returned if he would place relatively equal bets on every possible outcome. As a consequence, though, liquidity in this markt needs to be provided by American bettors. When markets beat the polls. Therefore, according to Davies et al. (2005),”Betfair has no interest in the outcome of any event it makes available.” Unlike the bookmaker, the betting exchange typically does not take any trading position and consequently makes money regardless of the outcome of the event. (2002). Department of Economics, UCLA.

(4) In 2007 betting exchange Parbet was renamed to MatchMyWager, before closing down in April 2008.

According to an article by Griffiths et al. This prediction is confirmed by the relatively large number of betting exchanges that have closed in 2007 and 2008 (see Figure 5). According to Davies et al. ”traditional bookmakers need to be well informed (studying horse racing and sporting events carefully) in order to make odds, and need to monitor market changes constantly in order to avoid being taken advantage of, or of being over-exposed.”

(22) Source: http://www.antiguawto.com/index.html

In Figure 3 the measured payout is shown during the biggest of thefour events that were part of this study, the World Championships Soccerof 2006 in Germany. (13) As Betfair’s co-founder Andrew Black told the newspaper Scotland on Sunday in 2005: ”Geography is an absolute priority. Therefore they claim only they should be obliged to acquire a license and pay taxes on their winnings, not their customers.

However, as sports betting in general will grow worldwide, it is likely the number of incidents of match fixing will also increase. New York: McGraw-Hill

Political lobby by bookmakers (UK)

Winning customers welcome

(17) Source: http://www.betfaircorporate.com/pdf/2006_10_16_casino.pdf

Davies, M., Pitt, L., Shapiro, D., & Watson, R. (2006). (2004, December). This would obviously pose an important threat to the most important strength of the betting exchange: offering better odds than the bookmaker.

Nevertheless, Matchbook seems to be an exception. Youth Gambling International Newsletter.

(2) Source: http://www.queensawards.org.uk

A betting exchange and a discount bookmaker have a lot in common, and are very much targeting the same kind of bettor, although both are operating in entirely different ways. In the current market it seems Betfair has grown to such a scale there’s hardly any serious competition the company needs to take into consideration. itself, it hasn’t stopped the possibility to bet with betting exchanges on sporting events taking place on American soil. For this reason Mansion decided to terminate its exchange business altogether in October 2007. Figure 5 of this paper shows a majority of betting exchanges appear to be focusing their offering on soccer, which also happens to already be one of the strongest and best developed sports on offer at Betfair. In economical terms, it is therefore safe to say betting exchanges have increased market completeness. (28)

Thompson, Jr., A. For example, Owen Byrne of the Jockey Club commented on this issue “there is a threat to the integrity of racing” (Stanley, 2003). Only if the offer is matched by another user, the bet has ‘action.’ An example of a typical market is shown in Figure 1.

Ruud H. In the past prediction markets have proved to predict future events better than traditional opinion polls. The Iowa Electronic Markets have been successful in predicting outcomes of American presidential elections and are more accurate than ’regular’ polls (Stix, 2008). The exchange should, because of the effects of Metcalfe’s Law, have a very hard time achieving a scale large enough to become profitable, especially when the competition has already been more successful in the past. (1998). Counterparty risk seems to be non-negligible and bettors take that into account. Recently though, both online bookmakers and sports governing bodies have claimed the rise of the betting exchange has made it easier for bettors to profit from insider trading. Also, we compare the most important players in the market. These markets are known as betting exchanges. European Commission.

(28) Source: http://news.bbc.co.uk/sport1/hi/other_sports/horse_racing/ 3616748.stm

The success of Betfair has left other betting exchanges fighting for tiny marketshares. According to Musumeci and Peterson (2004), who performed a study on betting on American football with two possible outcomes, most (American) bookmakers tend to offer their customers payout books of 0.955 in these markets. For example, some betting exchanges have, in cooperation with mobile phone companies, recently started offering customers the possibility to bet by making use of their mobile phone. (14)

Following the footsteps of Betfair dozens of new entrepreneurialonline betting exchanges have seen the light, especially of aScandinavian (e.g., http://www.betsson. Laffey (2005) writes ”in facilitating betting as a neutral intermediary the website [of the betting exchange] does not take on the risk function of the bookmaker and generates revenue by taking a commission from the winner.” As long as bettors make use of an exchange, bettors will pay commission to that exchange, and the exchange is guaranteed to earn a steady flow of income.

Although betting exchanges are still a relatively uncommon phenomenon in the United States, a few particular betting exchanges had already built a solid American customer base. Most authors doubt whether these exchanges will be able to take market-share from Betfair in the near future: Mainelli and Dibb (2004) point out that even if the competition of Betfair would succeed in offering better service or value, “the propositions needs to be a great deal better to compensate users for the loss of liquidity.”

David Hood, a spokesman for leading British bookmaker William Hill, commented on this issue in 2003 in the International Herald, “if I stand [...] outside a betting shop and offer to lay a bet which you take, I am breaking the law, because I am not a licensed bookmaker,” but “if we both boot up laptops in the street and strike the bet using a betting exchange, I am not breaking the law? What is the difference?” Betting exchanges have defended themselves by claiming not the bettor, but the exchanges themselves are in fact acting as a bookmaker, because they are the ones who collect the deposits and pay out the winnings. 7.

New Media Age. (2003). The betting exchange does not need to hire a specialist to determine the odds on the probabilities of any of the parties winning, and adjust odds if necessary, but the betting exchange, as Davies et al. As Martin Oelbermann, a director of German research-firm MECN, told press agency Bloomberg in 2005, “You can’t beat the first-mover advantage. European Management Journal, 23(3), 351-359.

At about the same time as the business model of the betting exchange was introduced, another new, less radically different, business model was born. financial firms to establish and implement policies and procedures to prevent payments to gambling businesses. (24,25)

In his article Griffiths made a list of recommendations for Internet gambling service providers to act ‘socially responsible,’ which have been for a large part picked up by both online bookmakers and betting exchanges. The most important arguments made by Griffiths include the fact the internet makes gambling much more convenient than betting in the casino (the bettor does not even have to leave the comfort of his own home), the much higher event frequency of gambling opportunities on the internet, and the asocial and anonymous character of internet gambling. The Guardian.

Probably the most important potential weakness of a betting exchange is not having enough users (and liquidity) to be able to attract new users. A remarkable finding is that it seems there is very little difference between the betting exchanges in terms of commission charged to customers and product offering. Communication of the Association for Information Systems, 15, 149-161.

Secondly, the betting exchanges are also analyzed on an individual basis. While some betting exchanges, including Betfair, did not accept American customers even before the Act was introduced because of unclear legislation, others, like Mansion, had to turn down a large part of their clientele because of the Act. J. Mainelli and Dibb rate such a possible venture as ‘a formidable challenger’ to in particular Betfair, if only because of its “established customer base, resources and marketing skills.”

Sector Analysis

Threats

These kind of stories are obviously particularly bad for the image of the betting exchange and could induce risk averse behavior from bettors. (2004), while a betting exchange allows bettors to bet against a certain outcome, “unscrupulous horse racing trainers and jockeys, for example, could lay their horse to lose, [...] securing winnings for themselves.”

(29) Source: http://news.bbc.co.uk/sport2/low/football/europe/ 5215260.stm

(10) Press announcements from the EC about this topic can be found at: http://europa.eu/rapid/

While, as already mentioned, Figure 3 only shows the results of one of the four studied sporting events, other events showed roughly identical findings. Recently betting companies, both betting exchanges and bookmakers, have filed complaints with the European Commission to overturn these national laws. M. (2006). Internet gambling: An overview of psychosocial impacts. (2005). P. According to Laffey (2005) there were problems of definition and also problems enforcing British legislation on the foreign users of the exchange. (2004). Betting on the exchanges: Changing customer relationships in the sports betting market in the UK. Internet gambling: Issues, concerns and recommendations. As Davies et al. A notable example was the effort by Mansion, which cut commission on winnings to as little as 1%. This is why Mainelli and Dibb estimate it’s “extremely likely” traditional bookmakers will in the future open their own betting exchange. He is currently self-employed and betting on sports professionally.

Figure 1: Screenshot from http://www.betfair.com, 24-08-2007 15:00h. Man Utd v Tottenham Change: Express view | Full view Matched: EUR 206,072 Refresh Selections: (3) 100.4% Back Man Utd 1.56 1.57 1.58 765 [euro] 17998 [euro] 4524 [euro] Tottenham 6.8 7 7.2 419 [euro] 309 [euro] 108 [euro] The Draw 4.1 4.2 4.3 291 [euro] 1012 [euro] 722 [euro] Selections: (3) Lay 99.1% Man Utd 1.59 1.6 1.61 806 [euro] 11320 [euro] 6816 [euro] Tottenham 734 7.6 7.8 91 [euro] 232 [euro] 599 [euro] The Draw 4.4 4.5 4.6 680 [euro] 501 [euro] 1227 [euro] Figure 2: SWOT-analysis of the betting exchange Strengths: Weaknesses: –Better odds –Effects of Metcalfe’s Law –Less operational risk –Bettors’ aversion to risk –Lower transaction costs –Increase of market completeness –Winning customers welcome Opportunities: Threats: –Less restrictive betting –More restrictive betting legislation (Europe) legislation (United States) –New markets (Asia / Australia) –Political lobby by bookmakers (UK) –Technological progress –”Discount” bookmakers –Expansion to related sectors –New entry from bookmakers –Migration of technology to –Match fixing unrelated sectors –Increase of gambling addiction Figure 5: Individual analysis of 20 major betting exchanges (“Y” = “Yes”, “N” = “No”) Reliability Legal Name Commission (2) (3) (4) (5) BetandGame 4.25% N N Y N (closed per February 2008) Betbull (*) 2.5% – 5.0% Y Y N N Betcruise 0% (**) N N N N Betdaq 2.0% – 5.0% N Y N N Betfair 2.0% – 5.0% Y Y Y N Betmate (*) 2.0% – 3.0% Y Y N N BetonBet 1.5% – 3.0% N N Y N Betsson 4.0% Y Y Y N EHorseX 1.75% – 5.0% N N Y Y IBetX 1.0% – 3.0% N Y Y N Intrade $0.00 – 0.15 / N N Y Y lot (***) Live-betting 5.00% N N Y N per payout Mansion 0.0% – 1.0% N N Y N (closed per October 2007) Matchbook 2.0% N Y Y Y MatchMyWager 1.5% – 4.0% N N Y N (closed per April 2008) MyBet 5.0% Y Y Y N Redbet 4.0% Y N Y N Supporterbet 3.0% – 5.0% N Y Y N TradeBetX / 4.0% N N Y Y Tradesports (closed per November 2008) Winitoo 4.0% N N Y N WorldBet- 0.9% – 5.0% N Y Y N Exchange Product offering Name (6) (7) BetandGame N Y Limited selection of (closed per major world sports; February 2008) Betbull (*) Y N Selection of major world sports; wide selection of major and minor soccer leagues; Betcruise N Y Limited selection of major world sports; Betdaq Y N Selection of major world sports; wide selection of major and minor soccer leagues; Betfair Y Y Wide selection of major and minor world sports; wide selection of major and minor soccer leagues; Betmate (*) Y Y Selection of major world sports; wide selection of major and minor soccer leagues; BetonBet Y Y Limited selection of major world sports; selection of major and minor soccer leagues; Betsson Y Y Selection of major world sports, as well as minor European sports; major and minor soccer leagues; EHorseX N N Limited selection of American sports; focus on American horse-racing; IBetX Y N Limited selection of major world sports; Intrade Y N Selection of non-sports political, financial and current events; Live-betting Y N Limited selection of major world sports; Mansion N Y Limited selection of (closed per major world sports; October 2007) selection of major and minor soccer leagues; Matchbook Y N Limited selection of major world sports; focus on North-American sports; MatchMyWager Y Y Limited selection of (closed per major world sports; April 2008) selection of major and minor soccer leagues; MyBet N N Selection of major world sports; Redbet N Y Very limited selection major world sports; selection of major and minor soccer leagues; Supporterbet N N Selection of exclusively soccer; TradeBetX / Y N Selection of major world Tradesports sports; focus on North- (closed per American sports; November 2008) Winitoo N N Very limited selection of major world sports; selection of major soccer leagues and regional soccer; WorldBet- Y N Selection of major world Exchange sports; selection of major soccer leagues; (*) Company operates as a “skin” of an established betting exchange; (**) Reduced commission is part of a promotional launching campaign; (**) Commission is calculated including both trading fee and expiry fee; (1) Percentage of commission charged by exchange on net winnings; Promotional offers not included; (2) Exchange is (part of) a publicly traded company, and/or is disclosing full financial information, and therefore giving customers insight into its financial “track-record”; (3) Exchange claims to hold and manage customers’ funds in a segregated account, to ensure customers’ funds remains separated from company funds (if unclear, listed as “No”); (4) Exchange is currently accepting customers from all nine European member states, whose gambling policy is currently under investigation by the European Commission; (5) Exchange is currently accepting customers from the United States; (6) Exchange offers its customers the possibility of live-betting; (7) Exchange offers its customers a complete one-stop betting portal, consisting of at least a casino and a poker platform;

Davies et al. Only in the last couple of years several big betting scandals have been discovered, reaching up to the very highest level of professional sports, for example, in horse-racing, soccer, and recently possible match-fixing in tennis. Betfair, as well as other exchanges, have addressed this issue by making a promise to customers all funds will be held in so called ring-fenced subsidiaries, to prevent the company funding itself by customers’ deposits (Hoare, 2002). (2003). [...] Nobody will be able to beat Betfair unless the management makes a massive mistake.” (32)

There have been attempts by American congressmen to repeal the Act, as well as an effort by the country of Antigua and Barbuda to make the United States change its laws by filing an official complaint to the World Trade Organization (WTO). Management Research News, 27(1/2), 95-103.

Nevertheless, it’s important to emphasize while the Act has blocked a large part of gambling-related financial transactions in the U.S. This has led to intensive competition between not only theexchanges themselves, but also between the exchanges and the traditionalbookmakers, whose market shares are increasingly under pressure.

In this paper we provide a SWOT-analysis of betting exchanges. (3) Whether this claim is accurate has been the subject of our own study, which took place in 2006. (2005). Betfair.com: Five technology forces revolutionize worldwide wagering. European Management Journal, 23(5), 533-541.

Griffiths, M. In the betting industry the success of a bookmaker has always been dependent on its ability to build a reliable track record. Markets for sporting events need to be created, and, when the event has taken place, settled according to the result, but that is where the responsibilities of the betting exchange end. In an earlier publication Griffiths (2003) already pointed out why gambling through the internet could lead to a rise in gambling addiction. We will argue that liquidity is a prime determinant of long-term success.

(16) For example: http://livevideo.betfair.com/

(21) Source: http://.www.online-gambling-insider.com/online-gambling/ ogi-Barney-Frank’sOnline-Gambling-Bill-Gathers-Momentum-07-24-07.html

In this paper the SWOT-analysis of the betting exchange has been performed by doing a literature study, including both academic studies and recent news articles about gambling in general and the betting exchange in particular. Mainelli and Dibb (2004) have noted “existing competitors all have business models and value propositions similar to Betfair” and therefore conclude ”it’s hard to see why they [these betting exchanges] should succeed in the future when their efforts to date have largely fallen short.”

Stix, G. Koning is a professor in the Department of Economics & Econometrics. AVG”),and the maximum payout offered by any of the bookmakers (“Bookm.HIGH”). (9) The European Commission seems to have taken these complaints seriously and has recently been investigating national gambling legislation in no less than nine different EU member states. The company is focusing its efforts on offering a wide selection of North American sports, an area in which Betfair has never been particularly strong. The economics of wagering markets. A, Paton, D., & Vaughan Williams, L. Of course, if every bettor that has ever laid a bet at a betting exchange would be obliged to follow these same regulations, this would pose a very serious threat to the business model of the betting exchange.

[1] University of Groningen

(13) Source: http://www.betfaircorporate.com/pdf/australia_licence.pdf

Phillips, T. Therefore, betting exchanges are searching for ways to encourage the customer to interact with other customers during the betting process, for example, through internet forums. A. For example, in the United Kingdom, seen by many as one of the most liberal countries in the world with regards to betting, a bet is not legally enforceable (and therefore often referred to as a ‘gentleman’s agreement’). The bookie puzzle: Auction versus dealer markets in online sports betting. (2008). The prices offered by Matchbook may not reflect all information that is available globally.

Figlewski, S., & Webb, G. (5) Nevertheless, the study should, next to the study of Ozgit, be regarded as a pilot study. As a result the likelihood that the user will join the exchange and start making offers for himself will also increase.

Ruud H. The Journal of Finance, 48(2), 761-777.

Institut Suisse de droit compare. In the final minutes before the event starts, a bettor would have been better off betting with any of the six betting exchanges.

The business model of the betting exchange allows its users to bet (back), but also to offer (lay) money, against whatever odds they like, at whatever time they like, on whatever event they like. Asian and Australian bettors also seem to be betting more money per person. It’s a land grab right now.”

A customer that bets with a bookmaker is not only restricted to the prices offered by the bookmaker, but also to the maximum stake that is accepted by the bookmaker. (12) These results are in line with findings of the OECD, The Economist Intelligence Unit, and Merrill Lynch, who have performed research into the propensity to gamble as a percentage of consumer spending. (2005, Fall). (7)

Increase of market completeness

(8) For example: http://fairplayers.com/en/magazine/ hot_news_fairplayers_11.html.

OECD. (2007). However, these offerings are generally not as well developed as the offering for European sports, with markets being characterized by below-average liquidity. Clearly, the passing of the Gambling Enforcement Act has had big consequences for the entire gambling industry, including the betting exchanges.

One of the first, and by far most successful, betting exchange is named Betfair (http://www.betfair.com). Mainelli and Dibb write “despite frequent attacks on the exchange model, traditional bookmakers would be commercially naive, if they were not also looking into opening their own exchange.” Furthermore, there has been talk of British bookmaker-giant Ladbrokes being interested in the take-over of Irish betting exchange Betdaq.27 Also, according to Laffey (2005) there have been rumors regarding a possible launch of one or several new betting exchange(s), offering down to zero percent commission, by the ‘Big Three,’ the three biggest British bookmakers William Hill, Coral, and Ladbrokes. Many of these bookmakers claim that bettors that ‘lay’ a bet at a betting exchange are in effect taking the role of the bookmaker, and therefore should be subject to the same regulations as the bookmaker. In the start-up stages of a new betting exchange, the number of customers may be limited, and as a result the number of offers will also be relatively small. (8) Betting companies have argued that in many cases national legislation is in contradiction to policy of the European Union (EU) regarding free movement of services, as well as the goal of the EU to create one single European market.

Mainelli, M., & Dibb, S. (2003, July 17)

The demand for different sports has resulted in increase in demand for Sports betting line all over the world. However today with the development of the Internet sports betting is become far more convenient and easy as you can wager on any sports activity right from your own house 24/7. Many people are considering wagering on their favorite sports game not just to make money but also to add excitement to the game. Online sports betting has seen a steady rise as more and more people are finding it convenient to bet from their homes any time of the day. . You can learn but you must also resist the temptation of becoming a compulsive gambler. It is unlike offline sports betting where you do not have multiple sports book options. It is more convenient and inexpensive as compared to land-based sports betting. Online sports’ betting is an adaptation that makes wagering on different sports game more convenient and profitable. Do not get addicted to online sports betting.

Online sports’ betting is an organized form of gambling. You need to know your limits and avoid unnecessary losses.

Starting with online sports betting

Here are some useful tips that can make your sports betting venture more convenient and simple:

Satisfy yourself about the processes followed by the bookmaker.

Initially people had to move to land based places just to wager on the outcome of a particular sports activity.

There is an interesting aspect to most sporting events, besides being convenient and inexpensive form of entertainment. Do not fall prey to unscrupulous or fraudulent operators.

Online sports betting also gives you an option to bet on different sports book.

Signup with multiple online sports book websites

Always read the terms and conditions of different sports book before betting on a particular sports activity.

Online sports betting can be enjoyable provided you play your odds right

In Florida and Arizona, it’s illegal to wager on contests of chance or skill.

The companies have insisted that their contests aren’t “gambling” because their customers engage in games that require more skill than chance, and they reiterated that argument in response to Schneiderman’s decision. Many permit betting on contests that depend more on skill than chance. Others, like New York and Washington, ban betting on games materially affected by chance, and still others prohibit betting if chance is a factor at all, no matter how minor. In Florida two state lawmakers said this week they had filed legislation to exempt fantasy sports from the state’s gambling laws. Roach has proposed legalizing casual, season-long fantasy leagues, not daily online betting.

DraftKings and FanDuel are not operating in Arizona, Iowa, Louisiana, Montana, Nevada or Washington. “We all just sort of knew,” she said.

___

By his count, daily fantasy sports sites have been operating on shaky legal ground in about a dozen states.

That could pose more risk than the companies or their backers big media companies and professional sports leagues have let on. In his letters to FanDuel and DraftKings, Schneiderman left the door open for legal action against any companies that run and market games in a similar way.

Most states have no laws that specifically address fantasy sports but do have gambling laws that might dictate whether they’re legal. “This creates a real vulnerability for the industry,” said Daniel Wallach, a sports and gaming lawyer in Florida. Federal law criminalizes gambling businesses that operate in violation of state law, with penalties that can include prison time, fines and seizure of assets.

While supporters have pointed to an exemption Congress carved out for fantasy sports in the 2006 Unlawful Internet Gambling Enforcement Act, that legislation did not override state gambling prohibitions or other federal statutes, including the Illegal Gambling Business Act. “My bill is to keep the little guy from doing something illegal.”

Chance is obviously a significant factor in sports, determining whether a player gets injured or has a bad day, whether referees miss an important call that affects players’ stats or simply how the ball bounces. DraftKings said in an emailed statement that the attorney general “did not take any time to understand our business or why daily fantasy sports are clearly a game of skill.”

SEATTLE (AP) The New York attorney general’s decision that daily fantasy sports betting sites FanDuel and DraftKings are illegal gambling operations in his state is a blow to the companies, but the multibillion-dollar industry could have more legal headaches yet to come.

AP reporter Bob Christie contributed from Phoenix.

New York Attorney General Eric Schneiderman on Tuesday ordered DraftKings and FanDuel to stop accepting bets in the state. Whoever conducts, finances, manages, owns or partly owns such a business can be fined or imprisoned for up to five years.

But in a number of states where the sites are operating that distinction is arguably incorrect or irrelevant. That law makes it federally illegal to run a gambling business that operates in violation of state law. But in Washington, Sen. “Daily fantasy sports is a skill game and is not considered gambling.”

“We need to put some sideboards around this,” she said. Pam Roach said it’s probably going to be years before any such effort might have a chance. He said the companies were offering contests of chance illegal gambling under state law and he accused the companies of misleading customers about their chances of winning in a barrage of advertisements. “That statute gives the government the power to take it all away. Thus, many argue, it’s also a factor in fantasy sports especially daily fantasy sports, where outcomes are determined over the course of a single day rather than allowing a contestant to strategize over the course of a season.

While the sites have opted not to do business in a handful of states, including Washington, where regulators have made clear they’re not welcome, they have been up and running in a number of others like New York where they’re legally dubious. That doesn’t mean other daily fantasy sports operators are in the clear. They can shut you down.”

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A spokeswoman, Susan Newer, said that was so obvious that the commission never even had to meet to discuss it. In Montana, the state lottery runs its own fantasy football contest, with customers at participating taverns allowed to bet up to $100, but the daily sites are banned.. The companies said Wednesday they intend to fight to remain in New York, in court if necessary.

Several states say they are reviewing the legality of daily fantasy sports or whether to regulate them, given their popularity and the vast sums at stake, and the industry says it would welcome what FanDuel’s chief executive called “sensible regulation.” Two states, Maryland and Kansas, have expressly permitted fantasy sports betting.

The laws often allow for state-run lotteries, with proceeds feeding budgets, and have exceptions for nonprofit groups that want to run bingo or other games as fundraisers, or for taverns trying to drum up business with low-level games such as pull-tabs. Several states in which the companies are operating have laws similar to New York and Washington, while a few, such as Tennessee, Arkansas and Vermont, have even stricter prohibitions.

Lawmakers around the country expect the fantasy sports industry to make a push for clear legalization. In Washington, the gambling commission specifically concluded that fantasy sports wagering whether as a casual, season-long endeavor among friends or as a daily, high-stakes bet placed online is illegal because the outcome is materially affected by chance.

Schneiderman has not targeted other fantasy sports operations. Tennessee, for example, bars “risking anything of value for profit” when the outcome is “to any degree contingent on chance.” Florida bans wagering on games of skill or chance, and a 1991 attorney general’s opinion concluded that fantasy sports betting was prohibited.

“Federal Law and 45 of the 50 US States allow skill based gaming,” DraftKings’ website says

Soccer and cricket were identified as the sports most threatened by criminals seeking to rig the gambling market but tennis, basketball, motor racing and badminton were also affected, according to the report, which is based on a two-year research.

Among solutions, the report recommended a sports betting tax to finance investigations into match-fixing and closer cooperation between betting companies and sporting bodies.

The report, compiled by the ICSS think-tank and the Sorbonne university in Paris, said that 80 percent of global sports betting was being carried out on illegal markets, placing it beyond the reach of regulators and investigators.

PARIS Criminals are using betting on sports events to launder $140 billion each year, a report said on Thursday, exposing a lack of effective regulation that allows match-fixing to spread.

A number of soccer leagues have been hit by match-fixing scandals in recent years and three Pakistani cricketers were jailed for a plot to deliberately bowl no balls during a test match against England at Lord’s in 2010.

(Reporting by Julien Pretot and Keith Weir, Editing by Ed Osmond/Amlan Chakraborty)

Several territories were identified as “sports betting havens”, with England topping the list with 114 online betting licences granted, ahead of Malta (86).

“It’s too important to be left to the bite of compromise,” said Eaton.

According to the report, 53 per cent of the illegal betting comes from Asia, while 49 per cent of the legal market is based in Europe.

Technology and live television have transformed the sports betting market in recent years, allowing viewers to bet on a wider range of events and gamble in real time as a match progresses.

“The problem is getting worse,” Mohammed Hanzab, president of the ICSS, said in his opening speech at the Sorbonne on Thursday.

“If we do nothing sport will become to be seen as an arena of corruption.”

“The rapid evolution of the global sports betting market has seen an increased risk of infiltration by organised crime and money laundering,” said Chris Eaton of the Qatar-based International Centre for Sport Security (ICSS).

Eaton, a former head of security at FIFA, said the changes have made suspect betting patterns harder to spot.

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Minani began betting three years ago, and he sees it like any other enterprise with risks and returns. Denny Hamlin has wins this season at Martinsville and in the NASCAR All-Star Race. Another person is in the driver’s seat when I gamble pushing me to lose all of it. You install software for the first time on your computer that the copyright holder hasn’t distributed or supported for greater than 5 years.

Denny Hamlin, Kasey Kahne and Carl Edwards are all 18 to 1 odds every to win the 2015 Jeff Kyle four hundred at the Brickyard at Indianapolis Motor Speedway. He stated the board’s decision speaks for itself. It isn’t excessively loud, or anything, nevertheless it’s noticeable while you’re up close. Alabama leads the series by a 5-2 depend. He even prefers betting to saving money in the financial institution, as a result of in his view you possibly can earn extra in betting – what he does not mention, though, is that in contrast to in betting, you’re unlikely to lose the money you set in the financial institution. Under the hood, the Roku four is powered by a more recent quad-core processor. It isn’t me navigating anymore. And he’s not alone – in any of the numerous betting enterprise around town, you might be assured to discover a crowd of young men, lots of the college students or unemployed. None of the three drivers have ever won this race. Charles Howell III virtually by no means wins but he’s earned $28.eight million on tour. Chad Campbell has four career wins but none since 2007. Kasey Kahne is still looking for his first win in 2015. Since Texas A&M joined the SEC the series is tied at 1-1. Jason Dufner has not received on tour since 2013. I even ignored that little voice inside me that was screaming, Go dwelling!!! I would like to pay attention to that voice that by no means steers me fallacious as a result of I feel it is my angels. I was tired, sick of gambling and of the noise within the casino. Make just a few five greenback bets after which keep within the sports book and watch the video games you wager on as an alternative of wandering over to the desk video games.

That is the Cash Line” bet the place bookmakers alter the price of the wager as an alternative of using a degree unfold to even the chances.

Calling the game for CBS would be the #1 crew of Vern Lundquist (play-by-play), Gary Danielson (colour commentary) and Allie LaForce (sideline reporter). Austin Cook dinner and Russell Knox are looking for their first wins on tour. Larson additionally has one profession win within the Tenting World Truck Collection in nine career begins there. Be certain the large sportsbook bonus you see marketed is best for you and compare the best bonus gives.

George Coetzee performed nicely last week to complete at -12 underneath and tied for 7th place. Kyle Larson has but to win a NASCAR Sprint Cup race in fifty eight starts. Watney has not gained since 2012. Clearly, Kyle Larson has never gained this race and does not have a win this season. Todd has one win on tour (2014) and he missed the minimize last week.. You’ll be able to wager on sports activities for simply five dollars at most sports activities books. operations, has repeatedly stated daily fantasy sports activities is playing and must be handled like all other legal playing operations. His success story turned the talk of the city, fireplace prompting many of his family and friends to follow swimsuit, although not all have ended up on the profitable side. You possibly can thank the additional hardware calls for of 4K video for that. Carl Edwards has a win which got here at Charlotte in May. And, for the first time, it also sports activities a tiny fan you could actually hear while it’s operating. This will be the 8th time Alabama and Texas A&M have played. That’s exactly it, Benny…the thrill. Larson won twice final 12 months within the Xfinity Sequence which was referred to as the Nationwide Series last year. Johnny Manziel led Texas A&M to an enormous upset over Alabama in 2013, but the Tide rolled all over the Aggies final year by a rating of 59-zero. He is looking for his first PGA win however has two wins on the Europena Tour in 2015. Ollie Schniederjans simply turned professional and is in search of his first win

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