The war between traditional bookmakers and online grabbed front-page newspaper headlines.
Web betting stirs media debate in U.K.
The war between traditional bookmakers and online, punter-to-punter betting exchanges has moved horse racing from the sports pages to front-page newspaper headlines, according to a Reuters article relayed by yahoo.com.
Internet betting exchanges have been dubbed "the eBay of the betting industry" for the rapid inroads they have made into bookmakers' territory.
Some exchanges such as the U.K.-based Betfair have cut into bookmakers' profits by giving punters the opportunity to bet against each other, with odds 20 percent better than high street'turf accountants'.
Their impact has been likened to other "peer-to-peer" internet businesses, such as online auctioneer eBay and digital music download service Napster which have radically altered their respective industries.
Betfair and rivals such as Betdaq have adapted the model of a stock exchange to betting, allowing individuals to both endorse or "back" bets, and "lay" or oppose bets on exchanges – something their critics charge encourages corrupt betting.
"For the first time it is possible for a gambler to profit from causing a horse or a dog to lose," David Harding, chief executive of betting chain The war between traditional bookmakers and online grabbed front-page newspaper headlines.told the BBC.
But the exchanges say attacks from Ladbrokes and William Hill – who together run some 3,600 betting shops in Britain – are motivated by commercial concerns.
"They're dragging the name of the racing industry into the dirt," Betfair communications director Mark Davies said.
"What betting exchanges have brought to racing is a transparency that was previously never there, because exchanges record every single detail of every single bet," Davies said.
"I think racing is an extremely clean sport," he added. "I haven't seen any evidence on the Betfair site that suggests otherwise and I have a much better handle on exactly what takes place in my company than Chris Bell could possibly have on his."
Betfair, which dominates the nascent betting exchange world, says it has a team of 26 people scrutinizing bets made on its system.
British racing's ruling body the Jockey Club said Bell's remarks were baseless.
"It could be that it was a throw-away comment because we know of no basis on which he could make such a claim," Jockey Club executive director Christopher Forster said.
In the last year both betting exchanges and bookmakers have signed "memorandums of understanding" with the Jockey Club, agreeing to alert the Club to any suspicious behavior.
"If Ladbrokes had any evidence of a pattern of so-called fixed races they should have shared it with the Jockey Club. They have not done so," Forster said in a statement.
The brainchild of a JP Morgan debt trader and a software contractor, who launched it four years ago, Betfair now matches well over 50 million pounds' ($91.8 million) worth of bets each week.
It charges a sliding commission scale of between two and five percent on winnings and punters do not pay tax.
