Do you think a betting exchange that charges no commission is a good business idea?

[quantus]

Well...I was rethinking some potential business ideas as a part of my new year's resolution. And...I was considering to create a website, something like BetFair - but without the commission being charged. I already discussed this in another forum and "yahoo answers" and 90% of the people ask about...how will the site make money since it doesn't charge a commission. But it all depends on how the bets are being matched. For instance:
Someone bets $100 on 1.99 and another customer bets $100 too on the same odds, while the remaning money is the vigourish for the website. Simple as that. This is actually how many bookmakers operate while they often takes the other site of the bet too. The idea of this new website will be to combine the best of bookmakers and an exchange. That is:

- The security of an exchange: You can play against other people and your payout is 99% secured.
- The simplicity of a bookmaker: There are no commissions when you bet. What you see is what you get. And the odds are high too, they aren't dramatically reduced by commissions.

I know there are many things to consider, like gambling license, money for advertising, hosting...etc...etc. But if I manage to make it work, then it should be profitable since this is what I am looking for as a gambler: Highest odds & Security.

10X and happy new year.

[skrtelfan]

That's the same idea as a 1% commission like Matchbook on baseball.

[wrongturn]

It is easy to create a site for this, but not easy to get enough liquidity.

[HeeeHAWWWW]

Just like amazon, facebook, ebay and so on, the first company to get decent volume seems to be the marketleader forever.

[FourLengthsClear]

I have no idea how much it costs just in terms of administration to run an exchange like Betfair but I understand they have in the region of 1500 employees, so it is clearly a large amount.

It would take truly massive liquidity/turnover for a no commission exchange to be viable.

[Santo]

Why, in your model, if customer A puts up a price of 1.99, would customer B bet at 1.99 rather than the 2.01 that would presumably be available?

[bookie]

Since you're citing Euro odds I imagine that's the market you're looking toward, and there are lots of businesses in front of you who could adjust their rates if your tiny commission (it's not "no commission") model worked. In the states, the entire issue is receiving deposits and sending withdrawals. It's expensive--and risky, and the risk and the expense wipe out the advantages of the vig discount.

Blackie announced an exchange last summer, and apparently pulled the plug on it once he figured out exactly what would be involved. Parlaymakers has an exchange feature that no one ever uses even though I believe that at the moment it is juice free.

[Ibrakadabra]

The success of an exchange has all to do with liquidity. A lot less to do with pricing.

You say you don´t take any commission but you charge a fee, so I don´t understand why it matters if you call it commission or juice or something else? And the "what you see is what you get" feature already exists at Betfair.

But don´t get me wrong, I would love to support a serious competitor to Betfair. It´s quite a way to get to there though...

[tommygun]

not a good idea.

[Legions36]

I understand what your saying about this im always for people trying to open there own business, but this about it theres match already in place as well as betfair which i dont use, do you really think people will leave theses sites to go to a new one. They are just to big and i dont think anyone will leave as they are just to juicy. I will tell you this for sure i will never leave match.

[Dark Horse]

SBR is in a position to try it out.

[BigSpoon]

Mansion had a 0% sports exchange several years ago...it was not a success.

[heathcliffm]

SBR is in a position to try it out.

thats a pretty good idea do it with sbr points/cash

[scratbandit]

I love the idea above mine with the sbr points cash idea....

[chase hardy]

GL with your idea!

[David]

You can bet commission free by making offers at Matchbook.

[Domer]

quantus this would have been a brilliant idea in like.....1999. 2011? not so much.

[sportsbetwin]

Why, in your model, if customer A puts up a price of 1.99, would customer B bet at 1.99 rather than the 2.01 that would presumably be available?

This is what you will have to to do - and then charge a 1% commission.

Wait - doesn't matchbook do that???

This is a major major project and it has been done before. Good luck but I don't think so!