Betfair's monopoly will eventually end..

..Even if you can't imagine right now how this would occur, something will eventually come along to topple the giant.   Inspired by an excellent small post by Cassini at Green All Over (where he gives examples of few fallen giants) I thought I'd add my 2p in the hope that someone will take up the mantle. (btw I have a cracking domain name if you have the right idea ;)

What will eventually topple Betfair does not necessarily need to be completely different (just in the right areas).  As their website grew, they moved further away from their original idea.  Their decision making process became messy, resulting in poor choices in usability, cost, design, customer service and regulation - the number of areas upon which improvements can be offered by a rival increases, as do the grievances of the current userbase (see Premium Charge, Cross Matching etc. as Cassini pointed out).

What is required IMO is a return to, and improvement upon, what the exchange concept was always about, betting person to person.  Of course Betfair is still doing this, but they increasingly push their alternative products, where they take a much greater share of the profits.  This aside, there are innovations to be made in the way people bet with one another, the way markets are set up and the social aspect of the site.  I have a few ideas, but I won't be posting them here.

One thing I am more than happy to post is that any rival would do well to push for much better regulation.  A site that actively seeks the same restrictions (or a variation) placed upon FSA regulated exchanges would be a leap in the right direction.  Best practices must surely involve not placing bets on your own exchange (even if it is hedging multiples), not compromising on best execution (cross matching) - exploiting your own platform's short-comings for profit.  Conflicts of interest (or potential conflicts of interest) need to be banished, as does this ability to switch between Bookmaker and Exchange at will, exchanges are very different to the former and should be treated as such.

We all brush these issues aside currently because liquidity is king,  but undercurrent builds with each step Betfair takes at the moment.  I met recently with one of the top guy's at Betfair, I mentioned that the users were disillusioned with the experience.  I told him we need some good news, a step in the right direction... It's overdue.  Perhaps a rebate on PC, or indeed a change in the way the charge is set up.. or frankly anything that is good for users would be helpful (when was the last time we had good news from BF ?).  Hope you took it on board.

There will come a day when something more exciting and interesting to use will arrive.  Something that experienced users see potential for profit in, at the same time as casual users have real enjoyment using.  When that day arrives, the switch away from Betfair will most probably be quicker than they could imagine.

Comments

[The Gambler.]

Straus out first ball.

Your views would be appreciated on this post below.

The Gambler.

http://testpunt.ning.com/profiles/blogs/the-new-betting-exchange

[Scott Ferguson]

Good timing for this post. I'm just reading an article called 'Tired of Strategic Planning' for my MBA, and it discusses companies where "the annual strategy review frequently amounts to little more than a stage on which business unit leaders present warmed-over updates of last year's presentations, take few risks in broaching new ideas, and strive above all to avoid embarrassment...'there is a lot of dancing, waving of feathers and beating of drums. No one is sure why we do it, but there is an almost mystical hope that something good will come out of it.'"

Sums up a certain company rather well I thought...

[James Tomshay]

I agree Betfair is nothing special, and they have let success blind them to many faults in their overall service. Their downfall is just a new, better site around the corner. It could pop up at any given second given the unpredictability of the internet.

[Keith - Racing Systems]

I think one of the things that took Betfair by surprise is the way traders have ended up interacting with the service.

In the early years it was trading that kept making the system crash. This has now been rectified, and now it is only updates that crash it! :0)

Most of the turnover is from trading, but this actually brings in little revenue for Betfair, hence the Premium charge. This charge is also aimed at those who profit from betting bots, although it does catch the odd professional gambler out.