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BETFAIR TO LAUNCH AS A BOOKMAKER

03/26/2012 : BETFAIR TO LAUNCH AS A BOOKMAKER
 
Company will soon introduce its own fixed-odds sports book
 
Online betting exchange Betfair is to launch itself as a bookmaker in a move designed to prevent customers deserting to rivals such as William Hill and Ladbrokes, the publication This Is Money reported over the weekend.
 
Interim chief executive Stephen Morana told This Is Money that Betfair will shortly be introducing its own fixed-odds sports book, which means it will start taking bets of its own rather than just acting as a marketplace where customers offer bets to each other.
 
"Our sports exchange always has been – and always will be – Betfair’s core product," said Morana. ‘It has revolutionised the industry and we have a loyal customer base, but we also recognise that there are certain bets at certain times that the exchange, by its nature, cannot offer.
 
"Some of our customers are going to traditional bookies for a portion of their betting and we hope to address this with the introduction of an integrated risk product that will complement the exchange, not compete with it."
 
Morana said that Betfair has yet to decide on the br anding for its new bookmaking business.
 
Betfair has given investors a rough ride recently. Since listing at GBP 13 a share in October 2010 it has seen its share price plunge disappointingly to GBP 8.71.
 
Chief executive David Yu and founder-chairman Ed Wray have both since left the company, which earlier this year was forced to cancel millions of pounds in bets due to a ‘technical failure’.
 
This Is Money reports that some analysts believe that by combining betting exchange and bookmaking business models Betfair could boost profits by more than 50 percent, but there are warnings that the results are not certain.
 
The company boasts four million registered users, of whom 900,000 gamble regularly.
 
In the year to last April, it made pre-tax profits of GBP26.6 million on turnover of GBP 368.6 million.



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