WBX Moves to capitalise on Betfair Premium Charge
Betting Business - 2008-10-02
The decision by betting exchange Betfair to increase commission charges to its most successful customers has perplexed many in the industry and seen its competitors rush to pick up any dissatisfied punters, writes Andrew McCarron of Betting Business.
The complex new ‘premium charge’ targets Betfair clients who are winning significant sums annually while paying relatively little commission to the exchange and seem particularly set-up to hit arbers in the pocket.
The charge applies if an in credit customer, who has bet in more than 250 markets, has paid less than 20 per cent of gross profits in charges, over any continuous 60 week period.
Despite the fact the exchange says the charge will apply to less than 0.5 per cent of its customers, Betfair has been slated for how it has handled the issue and rivals have moved quickly to capitalise.
WBX put out ‘an open invitation to all disenfranchised and exploited exchange users’ by promising to offer all Betfair customers the chance to use WBX.com at their usual Betfair commission rate.
WBX CEO Malcolm Gray commented: “Betfair’s Premium Charge illustrates once again that a virtual monopoly in the exchange industry is in no one’s interests apart from Betfair’s. It seems that every few months they are making a change to benefit themselves over their members and this isn’t what I will enforce at WBX where we put our members first.
He added: “Our commission rates are some of the most competitive in the industry, our betting platform is fast and reliable, and instead of looking to increase the money our members pay we are continually striving to offer them better value through offers and promotions. WBX’s philosophy will always be to value the people who bet with us because we know only too well that they are the lifeblood of our business.”
The new charge may also bite into the profits of the ‘betting exchange’ shops, which the Gambling Commission has only recently moved to licence. If customers are making less money through their Betfair activity, they might be less inclined to pay an extra premium for the benefit of using the exchange in an LBO–style environment.
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