I am just using this blog post as an excuse to write the juvenile yet undeniably funny title, despite the fact plenty of others have already done so! But while I'm here, I may as well chat about just what this sex change will actually mean. Will it finally cut off Betfair's bloated balls? Will the testosterone fly between these two heavyweights? Long term readers will know that I long ago campaigned for traders to move to Betdaq but became angered by Betdaq's lack of action. I feared that Ladbrokes were not going to do enough to turn them into a true competitor and the fact they've been so quiet since acquiring the purple place, has done nothing to make me think otherwise.
I'm hearing that liquidity on horse racing and football is getting worse this year on Betfair but I've not seen the same issues with tennis. Certainly, I've not had any problems getting matched and if anything, it looks as though liquidity in-play is better - though I don't have stats to back this up. The introduction of a serious competitor will almost certainly make liquidity worse in the short term, as it will be split between the two exchanges. But this is a very myopic view, in my opinion. Long term, competition can surely only be healthy in terms of the premium charge. If Betfair start to lose more customers, it could spell a long, terminal decline for them because they have very few (if any!) loyal customers as a fanbase and plenty who would relish their complete demise.
As a newcomer to betting, you are much more likely to start off with Ladbrokes than Betfair. People tend to move onto Betfair AFTER starting with the traditional bookmakers, most likely because they are curious about the exchange model or want to try out some bookie bonus bagging (which is how I first discovered them). If punters are now starting with Ladbrokes and immediately discovering the Lads Exchange, why would they then bother with the (un)Fair Lady? Especially once they discover that one has a tax on winners and the other doesn't! If the Lads sportsbook somehow feeds into the exchange, that immediately gives them a massive advantage over Betfair too.
Is it right for us to start getting excited finally, about a real exchange option? Well there will always be those who see the negative side; the split liquidity and the fact that Ladbrokes are still a bookmaker and that greed will inevitably result in them introducing a charge at some point too. But even if they did, the difference now is that we have a credible option at our fingertips. So if Ladbrokes do introduce a charge (and they'd be pretty stupid to create one at any time in the near future), I would imagine Betfair would be forced to react by cutting theirs - so hopefully, we'll get some sort of charge war! In fact, if Ladbrokes do start to take away Betfair's stranglehold, they will surely have no choice but to improve their dire customer service and reduce the charge anyway - though I doubt they would have anyone left to charge! It's possible even, that each exchange could end up specialising in one sport over another. Maybe Betfair will drop the premium charge entirely for tennis only? Who knows! But the important thing is, the monopoly would be over and what happens in the market would be back in the hands of us - the customer. They will be forced to compete to provide us with what we want and I don't see how anyone could possibly find negativity in that.
Looking even further onwards, success for Ladbrokes might even spark interest from another big bookie - how about William Hill buying up WBX to become WHX? Or Paddy Power acquiring Smarkets and finally getting rid of that awful name to become the Power-Ex? With markets starting to open up slowly in the USA, maybe this will tempt these players into the market? OK, I'm dreaming but it wasn't that long ago that people would've baulked at my suggestion that a bookie should buy up Betdaq - well it's been done! I still dream of a day where no one uses a bookie and everyone bets against fellow punters. Let's face it, the only reason they don't right now is because the average punter doesn't understand how exchanges work or doesn't have a grasp of the technology required (i.e. can't work the interwebs).
One of my mates has been punting for many years longer than I have but because he doesn't even know how to get an email address, let alone understand Betfair, he doesn't realise the opportunities that exist on an exchange. If these people could somehow be reached and educated, you'd see a new wave of exchange punters emerge. In the future, when every home will have free broadband and the current young generations are well versed in the technology, why would anyone bother using a bookie? Just let me dream for now. It would be a beautiful, utopian, premium charge-less, paradise..............