In-running (in-play) betting: responses

In-running (in-play) betting: responses March 2009

Contents 1 Introduction 3 2 Issues and responses to the paper 3 In-running betting 3 Technological advantages 5 Trading rooms 9 Time delays in bet processing 10 Cheating and integrity in sports betting 12 Problem gambling 13 Spread betting 14 Other issues around in-running betting 15 3 Conclusion 16 Appendix A List of respondents 17 2

1 Introduction 1.1 In May 2008, the Gambling Commission (the Commission) published an issues paper on in-running (in-play) betting 1. There followed a public consultation on the issues relating to in-running betting raised in the paper with questions on which we were seeking further information and evidence. 1.2 The issues paper was part of an evidence and opinion-gathering exercise designed to provide the Commission with information on whether in-running betting posed particular risks to the three licensing objectives and if any additional regulation was required to reduce any risk to these objectives, which are: preventing gambling from being a source of crime or disorder, being associated with crime or disorder, or being used to support crime ensuring that gambling is conducted in a fair and open way protecting children and other vulnerable persons from being harmed or exploited by gambling. 1.3 The Commission noted that, while the consultation might or might not lead to any change to the existing regulation of in-running betting, it should improve understanding on inrunning betting and the appropriate regulatory framework required. It welcomed responses from anyone with an interest in in-running betting. The consultation was limited to the operation of in-running betting but this included both the operation of in-running betting on betting exchanges and all other forms of in-running betting including online and in traditional betting shops. It specifically excluded the issue of in running betting on the exchanges in the course of business as this aspect had previously been considered by the Commission and was not considered to raise particular concerns in relation to the licensing objectives. 1.4 There were 18 responses to the issues paper. A list of the respondents is at Appendix A. We are grateful for all of the responses received. This document aims to reflect the views offered, but it does not purport to describe all of the responses in detail. 1.5 The Commission has given careful consideration to all the consultation responses, and also to all the feedback given at the workshop held in June 2008, before finalising its policy position. We have also considered all other sources of information available to us including our own assessment of the in-running betting markets. As a result the Commission has concurrently issued a position paper reflecting the Commission s current thinking 2. 2 Issues and responses to the paper In-running betting Consultation proposals 2.1 The issues paper made clear that the Commission was interested in receiving further information on whether in-running betting poses any risks to the three licensing objectives. In particular, it asked whether there is any unfairness or insufficient awareness of the potential disparity in knowledge about how the markets work, how the odds are generated and whether the betting customer is aware of what is going on at the event. 1 In-running (In-play) betting: issues paper (May 2008) available from the Commission s website, www.gamblingcommission.gov.uk 2 In-running (In-play) betting: Position paper (March 2009) 3

2.2 The Commission noted that although evidence had been put forward indicating that inrunning betting attracts customers who have knowledge and experience rather than drawing in naïve betting customers to lose their money, further evidence was sought on this issue. 2.3 The Commission also noted in the issues paper that further evidence had been submitted suggesting that as in-running betting markets are made up of skilled and knowledgeable betting customers, it makes the market prices fairer as those betting customers will put their money where the prices are a fair reflection of the progress of the event. We were interested to hear whether the betting market does attract more skilled betting customers and whether this subsequently makes the market fair and open for betting customers. Consultation questions Q 1. Q 2. Do you have any evidence that in-running betting puts the licensing objectives at risk (eg lack of fairness or openness inherent in in-running betting, or a risk of causing harm to vulnerable people)? Do you have any information about the customer profile in the in-running betting market (ie is it made up predominantly of specialist, knowledgeable betting customers)? Respondents views Evidence that in-running betting puts the licensing objectives at risk 2.4 Responses to this question were divided between those that argued that there was no evidence to suggest in-running betting puts the licensing objectives at risk and those respondents that did believe in-running betting poses a risk and provided examples as evidence. 2.5 One betting operator mentioned that they had conducted their own research into in-running betting. They interviewed a significant number of customers and the data collected indicated that there was no evidence that would support the suggestion that in-running betting poses a greater risk of harm to vulnerable people than any other forms of betting. 2.6 The same betting operator also stated that when their survey data was segregated into groups of those customers who were profitable and unprofitable, based over a six month period, the responses were indistinguishable. They suggested that whether winning or losing, their in-running betting customers felt that in-running betting was fairer than most forms of gambling. 2.7 One individual stated that betting exchanges that apply a fixed time delay after bets have been submitted to the exchange greatly adds transparency and fairness. However, this individual did comment that they thought online betting companies and spread betting firms not regulated by the Gambling Commission that offer in-running betting through their website or on the telephone with no fixed processes in place were unfair. The respondent remarked that spread firms, in particular, leave their clients on hold for differing periods of time before a bet is accepted or rejected. They stated that this is not giving the customer a fair chance as there is no process in place that protects the customer from being on hold while a sporting event may change. The respondent suggested that spread firms should be regulated like betting exchanges putting in place a definitive process when accepting bets from customers. 4

2.8 Some respondents commented that there is evidence that in-running betting is conducted in an unfair manner on betting exchanges. One individual remarked that live events on television are often significantly delayed, and not all picture providers broadcast pictures with an equal delay and additionally these delays are not even consistent from day to day. This in turn, they state, makes it difficult for the customer to be aware of the level of fairness his bet is subject to. They also stated that as a result of the time delays of pictures unfair bets are being taken by customers who may be on the course or in a trading room with the fastest technology at their disposal. Information about the customer profile 2.9 When asked whether any information was available about the customer profile in the inrunning betting market, several respondents stated that they believe in-running betting is made up predominantly of specialist, knowledgeable betting customers. 2.10 The majority of the betting industry respondents considered the main profile of customers betting in-running to be relatively experienced. Although some of the betting industry felt it difficult to characterise groups of consumers under these types of headings, they stated instead that in most cases in-running betting was less profitable for betting operators than pre-event betting which they attributed to the fast and unpredictable nature of in-running betting making the operator s job more complicated. 2.11 One betting operator remarked that they had no firm evidence that in-running betting consisted in the main of specialist betting customers, but anecdotal evidence confirmed that the key market makers (those who propose prices) were specialists. Another betting operator also stated that although customers betting in-running appeared to be specialist, knowledgeable customers there were a growing number of general customers, traders and novice customers betting on in-running markets. 2.12 One in-running betting customer noted that although he only bet small amounts he still found that in-running betting provided him with a better chance of winning which he believed was available for anyone to utilise. One individual believed that the majority of people betting in-running were professionals. However, they noted that novice customers were protected by these professionals, as the professionals made the exchange markets efficient. They stated that it was in everyone s interests to make these markets efficient, as it provided protection for all by ensuring fair prices. They further stated that in their view the current safeguards that were in place were sufficient. 2.13 One respondent disagreed with the evidence that the Commission had been presented with and argued that in-running betting was not restricted to just experts but was also open to hobbyist customers who were exploited and at a disadvantage compared to those with knowledge of the market. Technological advantages Consultation proposals 2.14 The Commission had used the issues paper to open up the discussion on technological advantages available in the in-running betting market. We were interested in hearing views on whether the inequalities that exist between in-running betting customers as a result of the availability of information and technology is causing the licensing objectives to be undermined in any way. In this case, we were interested in three related areas: sources of information and time delays; availability of high-speed broadband; and computer software packages that are specifically designed to assist in-running betting customers (known as bots ). 5

2.15 The issues paper noted that the Commission currently had evidence which indicated that there was awareness amongst betting customers, particularly the more knowledgeable and experienced ones, of the variable time delays in feeds and that some people may have had faster feeds than others. We asked for further evidence of how widespread the use of variable time delays was and how much awareness there was of variable time delays among in-running betting customers. 2.16 The Commission was also interested in hearing views on the Information Provision Annex (IPA) 3 for in-running betting set out in the Commission s Remote Technical Standards. The Commission was keen to receive further information on whether this provision is sufficient and effective in highlighting time delays to in-running betting customers. 2.17 The variability of speed on internet connections generates the ability for some betting customers to make their bets faster than others. We wanted to know whether this is a commonly known and understood situation, and whether warnings would therefore be unnecessary as people betting in-running online are aware that the better the internet connection, the more reliably and quickly the bet is processed. 2.18 The Commission also used the issues paper to gain views on the use of bots. Although the evidence we have suggests that bots are widely-used by experienced or frequent inrunning betting customers, the Commission requested further evidence on the scale of use of bots, the advantages they specifically provide for in-running betting, and whether their use unfairly disadvantages other betting customers. Consultation questions Q 3. Q 4. Q 5. Q 6. Do you have evidence as to whether players in in-running markets are aware of time delays and faster feeds? Do you have evidence that suggests that the level of awareness satisfies the fair and open licensing objective and that any advantage is fair? Does the existing provision in the Commission s Remote Technical Standards sufficiently deal with the issue of variable time delays in feeds and ensure that there is sufficient awareness of and openness around this advantage? Does the variable speed available for broadband internet cause unfairness between betting customers - should there be a warning highlighting the advantage of a high-speed internet connection? Is the use of bots widespread amongst in-running betting customers and is their use fair and open? Respondents views Faster feeds and delays 2.19 Nine of the twelve respondents consider that players betting in-running are aware of time delays and faster feeds. The betting industry stated that players betting in-running were aware of time delays and faster feeds. Information and warning messages are displayed on in-running web pages, forums, terms and conditions and help menus in order to increase customers awareness of the existence of the possible advantages/ disadvantages of time delays and faster feeds and satisfy the fair and open licensing objective. 6

2.20 One betting operator commented that after conducting their own customer survey, results showed that an overwhelming majority of respondents expressed an awareness of time delays and faster feeds. In order to ascertain whether this awareness fits with the fair and open licensing objective they noted that faster feeds were not the only way that players could gain an advantage. Players who study form might also gain an advantage over others this type of advantage is fairly obtained and should be comparable to technological advantages that can equally be obtained. The results of their survey showed that when customers were asked whether they were aware that others might gain an advantage over them by studying form, the results showed that again almost all were aware. With this in mind, they questioned whether betting operators offering in-running betting should also display warnings relating to this particular advantage and all others that are possible. 2.21 Several respondents stated that the rules of in-running betting and warnings regarding time delays to picture and data feeds are available and displayed for all to see when betting inrunning. One respondent went on to say that unless a betting customer is at the event there is always a time differential and in their experience people vary their play accordingly. Another respondent remarked that although they had no evidence as such, many who bet in-running use other mediums such as the radio in conjunction with TV pictures to keep up to speed with an event. 2.22 One individual commented that in-running betting is well advertised on betting exchanges as having different service providers for data feeds at varying speeds. They stated that their fairly obtained advantage comes from years of experience, form knowledge and race-reading skills. They believed that they can make a profit on pictures even if they are slightly slower as it is their knowledge of the sport which gives them a fair advantage. 2.23 One respondent believes that any advantage in broadcast feed is fair. However, what they didn t consider fair was that players with the fastest feeds are being protected by the time delays in place for processing bets. Another individual commented that there was a general awareness of time delays and faster feeds but few understood its significance to any great depth. They stated that many did not realise that the time delays on data feeds vary daily. 2.24 One individual believes that in-running players betting on betting exchanges are aware of the time delays and bet accordingly. They suggested that it might be useful if operators providing in-running betting mention in the market guidelines which data feed they are using. Remote technical standards 2.25 Responses to the question of whether the existing provision in the remote technical standards is sufficient were divided with the majority of respondents agreeing that the provision was sufficient, while a small number of respondents disagreed proposing several additional measures. 2.26 The respondents from the betting industry considered that the existing provision in the remote technical standards sufficiently deals with the issue of variable time delays in data feeds and there is sufficient awareness of and openness around this advantage. One betting operator commented that for any warning to be effective there needs to be a balance between the prominence of that warning to ensure it is seen, and the warning being succinct so that it stands the greatest chance of being understood. They believe there is no evidence to suggest that those warnings could be any more explicit without making them less succinct and reducing the likelihood of customers adequately comprehending them. 2.27 Respondents from the trade associations believe that the existing provision is sufficient and unless reliable evidence could be presented to the contrary they considered there is no basis for additional information or restrictions being introduced. 7

2.28 One individual disagreed that the existing provision is sufficient. Consequently they put forward the proposal that a code of practice should be established with the broadcasting companies and operators to ensure that a broadcaster s time delays (used for betting marketing purposes) does not fall below agreed limits. They also suggested that the time delay for that particular day/event should be on the user s screen with the real time of the event also displayed on the screen. Internet speeds 2.29 The majority of respondents believe that the variable speed available for broadband internet does not cause unfairness between betting customers as customers are aware of this and it is available for all to utilise. 2.30 One individual commented that even fast broadband connections have slow periods with no guarantee of matching a bet quickly. They also remarked that in an open market place, it is the choice of the player whether they choose to place a bet. Another respondent did not believe variable speed internet connections were unfair stating that all customers are aware it is not a level playing field. Some will have an advantage due to better technology whilst others will have an advantage as they have form knowledge or race reading skills. 2.31 One betting operator believes that customers are fully aware of their internet connection as their whole experience when using the internet would be affected if they had a slow connection. Betting operators websites tend to have a high bandwidth and if a customer s equipment or internet connection is not sufficient this will be evident at all times and certainly before bet placement. They also did not feel a warning relating to internet connections was appropriate. They remarked that a betting site could end up looking like the small print from an insurance contract which they believe would make it less likely to be read or understood by customers. 2.32 A number of trade associations commented that customers are aware of internet speed connections and didn t consider that further restrictions or warnings were required. They also believe that having too many screen warnings could become counter productive as they will lose their impact. They further commented that internet connectivity is a complex issue and it would be difficult to define meaningfully what counted as a high-speed connection when users with the same service can experience different speeds of access depending, for instance, on their physical locations. 2.33 A few respondents, including a betting operator did however feel that further measures could be implemented to warn customers of the variability of speed on internet connections. They believe that anyone using the internet should be aware that response times are variable but suggested that a warning message within the in-running rules would ensure that everyone is aware of the advantages derived from having a fast internet connection. Another respondent proposed, as part of the betting service, customers being able to ping betting operators to find out the current internet delay and this information is then displayed on their screen. Bots 2.34 The majority of respondents did not think that the use of bots is widespread amongst inrunning betting customers. They do believe that in-running betting customers are aware of their existence and the fact that other players may be using them. 2.35 The majority of respondents also considered the use of bots as fair and open with only a couple of respondents holding an opposing view. A number of the trade associations stated that bots are an important tool used by some betting exchange customers. However, they commented that they were only one of many that are available should customers wish to use them. They stated some customers have better equipment or sources of information but that does not mean that their use is unfair to a degree that regulators need to intervene. 8

2.36 One betting operator considered the use of bots as fair and open with no discernable advantage other than speed of execution. They also noted that bots were readily available to customers in the marketplace. 2.37 One respondent, however, believes that bots do clog up the system with multiple backs/ lays leaving non-bot users unable to reliably stake their bets at the advertised price. One trade association believes that those using bots are using them as a tool to trade and as a result should be licensed by the Gambling Commission. Trading rooms Consultation proposals 2.38 The Commission was interested in hearing views on the use of trading rooms. Trading rooms are similar to internet cafes but dedicated to providing a service for in-running betting customers. They do this by offering high-speed internet and fast, live sports feeds for paying customers who usually rent a seat for prolonged periods. There may also be advertising for betting sites and even a commercial relationship between the remote betting operator and the trading room owner. 2.39 The issues paper asked for evidence on whether the technological advantages that trading rooms offer actually prevail over race reading skills and knowledge of the sporting event to which the betting relates. Evidence we had been provided with suggested that the popularity of trading rooms was being driven by the supposition that they offered all the technological advantages available to assist betting customers in utilising their skill to make a profit from in-running betting. We asked for evidence on the popularity and use of trading rooms as well as the perceived and actual advantages they provide for people betting inrunning. Consultation question Q 7. Do trading rooms offer a significant advantage for their customers over other betting customers or does skill and knowledge, in relation to the events concerned; outweigh the technological advantages of a trading room? Do the advantages offered by a trading room put other betting customers elsewhere at a disadvantage and is there awareness that trading rooms are being used by skilled customers? Respondents views 2.40 From those who provided a response, ten out of the thirteen respondents believe that in order for customers to be successful in a trading room they also need to have skill and knowledge of the markets they are betting on. One respondent commented that many believe trading rooms give them the perceived edge which guarantees them a profit only to fail due to their lack of specialist knowledge. 2.41 A number of respondents were also of the opinion that people who use trading rooms do so not only for the advantage of having fast data feeds and internet connections but also the opportunity to interact with others as an alternative of betting at home alone. 2.42 One betting operator stated that the technology available in trading rooms could also be purchased for the home but the advantage of using a trading room is that it brings this technology into one room without significant capital outlay for the individual. Another betting operator believes that there will always be customers with different levels of expertise or different tools betting against each other. They believe this is inevitable and untraceable and that customers are aware of the fact that they might be betting against someone who has one or more of these advantages. 9

2.43 A few respondents did consider trading rooms as offering significant advantages. One individual believes that trading rooms are a way of levelling out the market. However, they also felt that trading rooms give rise to and encourage structural inequalities such as the time delays in place for processing bets. Another individual also believes that trading rooms allow betting customers to gain a time advantage over others that have slower equipment, with sports skill being of no use if you cannot get the bet matched or cancelled. 2.44 One individual believes that given clients pay a sum to have access to trading rooms they clearly offer an economic advantage to the customer. One betting operator provided details of an independent review they conducted of trading rooms (unrelated to the Commission s consultation). In terms of the advantage conferred by trading rooms, the data they had collated showed that for those customers indentified as placing bets from trading rooms 54.8% were profitable over that period (the sample taken was in excess of 50 trading room customers). They concluded from this that if the advantage of attending trading rooms was unfair it would be highly unlikely that more than 45% of those using the facility would have been unprofitable. In an unfair game those profiting from any unfairness would typically have a much higher success rate. 2.45 The same betting operator also rejects the idea that the advantages of trading rooms put other betting customers elsewhere at a disadvantage. They state that on the contrary the existence of trading rooms results in a more competitive market. If trading rooms did not exist there would still be customers with a time advantage, either at the course or with faster pictures at home but there would be fewer of them and this would reasonably be expected to result in less competitive prices. Another respondent also considered that trading rooms made markets more efficient and did not believe that their existence put other customers at a disadvantage. One individual stated that trading rooms are there for all to utilise if they are prepared to pay for the facility, and it is a person s personal choice whether they choose to bet. Time delays in bet processing Consultation proposals 2.46 The Commission noted that some people are concerned that the time delays in place for processing bets may be exposing them to an unnecessary element of risk in such a way that they are uncertain of the status of their bets and therefore their financial position. There had also been concerns raised that the time delays built into operators systems to allow them time to choose whether to accept a bet could be properly considered fair and open, especially considering that such time delays vary considerably. 2.47 The issues paper was interested in hearing the views of operators and customers on the use of these time delays, awareness of the time delays and their effect on the in-running market. It also asked for further evidence on whether the current time delays are sufficient to ensure in-running markets that are offered through all mediums are fair and do not disadvantage some betting customers. Consultation question Q 8. Are in-running betting customers fully aware of the time delays in place for processing bets, do they ensure fairness, and should they be clearly displayed for every market? Do you have evidence that customers are being disadvantaged by time delays? 10

Respondents views 2.48 The majority of respondents believe that customers are aware of the time delays in place for processing bets. The betting industry responses all suggested that customers are aware of the time delays. One large betting operator stated that after conducting their own independent survey almost all respondents cited an awareness of the delay imposed on the processing of bets in-running. Another betting operator stated that market information is at all times clearly displayed for their customers. A further betting operator believes that advising customers of time delays within their in-running rules section was sufficient enough to make customers aware. 2.49 A few respondents did feel however that not all customers are aware of the time delays imposed for processing bets. They maintained that some betting operators do not notify customers of the time delays and on any given event change them without notice. They further commented that even sophisticated in-running betting customers regularly ask other users what the length of delays is as they prove to be inconsistent. As a result they feel that clear information needs to be displayed and in particular information on market suspensions. They believe that currently those on faster feeds are cancelling bad bets long before markets are suspended and making new bets as they already know the outcome of the event. They believe that operators should make clear what data feeds are being used (including time delays) as well as displaying what the time delays are for processing bets on that particular event. 2.50 Most respondents felt that the time delays in place were fair. One individual commented that the time delays are always stated on in-running markets and the current delays for horseracing and cricket/ football were just right. A few respondents stated that the time delays were in place to protect against betting customers at the event taking advantage of fallers etc and also believed that the time delays set by operators were about right, in particular for horse racing. A few of the trade associations felt that it was not right to refer to delays but rather simply refer to them as the time it takes to process bets. They stated that this time was self evident to customers and no process is instantaneous. They further stated that this time period is partly for technological reasons such as connectivity online but also to prevent customers taking advantage of the time it takes to suspend or update markets following a change in circumstances in the event. 2.51 One respondent did however raise concerns about the fairness of in-running betting on tennis. They feel that the time delay imposed for this event was not sufficient to protect against those attending the events or with faster feeds resulting in others being at a disadvantage. The respondent suggested implementing a slightly longer delay to prevent bets being taken unfairly. They also stated that betting operators have often increased the in-running bet delay on other sporting events so they could implement similar measures for tennis restoring fairness back into the market. 2.52 Another respondent also commented that the time delays were unfair. Conversely, however, they suggested in-running betting implemented a zero clock where there was no time delay on bets. They stated that having no time delay on processing bets would level out the playing field where fair prices would be offered. 2.53 When asked whether there was evidence of customers being disadvantaged by time delays most respondents did not present any, although some did raise issues. One operator stated that ultimately the delay on bet placement is to protect customers with unmatched bet offers by giving them time to cancel. They stated that although delays vary by sport it is rare that they are changed and if alternative delay lengths are tested these will typically be announced in advance. They also stated that they apply an equal time delay to all bets on a given market therefore no customer is disadvantaged to any other customer. They further stated that appropriate delays have been set dependent on the nature of the sport, the level of TV coverage and the activity of their customers. 11

2.54 A few of the trade associations also believe that customers are not being disadvantaged by time delays. They confirmed their full support of consumer protection, but had no evidence to suggest customers were at a disadvantage. In light of this they considered that the Commission s existing licensing requirements provided a more than sufficient safeguard. 2.55 A couple of respondents believe that the time delays do put some customers at a disadvantage. They feel that the time delays imposed are not long enough to protect against those attending the events or with faster feeds resulting in others being at a disadvantage. One individual commented that in particular the time delay for horseracing is unfair. They suggest that the time delay in bet placement for in-running bets on horseracing is increased to be greater than the delay in pictures which in turn will protect customers. Cheating and integrity in sports betting Consultation proposals 2.56 The Commission was interested in obtaining evidence to show whether in-running betting poses a specific inherent, or greater, risk to integrity that is not present or as great for antepost betting. It also asked for evidence of whether certain types of in-running bets generate additional risks to betting integrity and to the integrity of that particular sport. 2.57 The issues paper also noted other work that the Commission has done on integrity in sports betting with evidence pointing to the number of incidents giving cause for concern being low. However the Commission sought any information that in-running betting poses a specific and identifiable risk to integrity in sports betting. Consultation question Q 9. Do you have any evidence that in-running betting encourages cheating offences to take place, in comparison to ante-post betting, and is there any evidence that in-running betting poses a specific or greater risk to integrity in sports betting? Respondents views 2.58 Of the twelve responses we received to this question, ten respondents did not have any evidence to suggest that in-running betting encourages cheating offences to take place in comparison to ante-post betting. There was a general consensus that whether bets are taken in-running or ante-post there is an audit trail and any unusual betting or running patterns would be evidenced and highlighted. 2.59 One betting operator stated that although it is theoretically possible it would be difficult to prove that in-running betting poses a risk to integrity in sports betting. They stated that they have systems to measure the telemetry of every horse in a race which as part of a comparative database would indicate unusual running patterns and would act as a deterrent or be used as evidence should an issue arise. One individual believed that the data collected by operators should provide protection for the gambling public and in their view there were now better safeguards. 2.60 One trade association stated that they had provided evidence to the DCMS and the Commission which shows that the number of incidents involving suspicious betting activity in recent years is very low. Moreover, none of these cases involved in-running betting. 12

2.61 A few of the respondents however, do believe that in-running betting encourages cheating offences to take place with one particular example being cited. This concerned operators allowing bets to be taken where the result of the event had already been established. They stated that operators frequently continue to allow bets to be matched after the outcome of an event is known and before suspending the market after the event has closed. This allowed those with faster feeds to take advantage of the time delay and unfairly take bets off others. They stated that sometimes these late suspensions of markets are seen and bets cancelled, but in the majority of cases they are not noticed or simply permitted to go by unaddressed. 2.62 Another example where they believe cheating takes place is betting on photo finishes and stewards enquiries. They stated that some operators apply a one second time delay when a market is reopened for photo finishes and stewards enquiries which is not sufficient for those betting with longer data feed delays. 2.63 One individual also stated that at times steward s enquiries have been announced when television channels broadcasting the events have been on advertisement breaks. They believe this is unfair as those attending the events are at a significant advantage to those watching the televised event. 2.64 When asked whether in-running betting poses a specific or greater risk to integrity in sports betting the majority of respondents stated they did not have any evidence. One betting operator believes that as there is no evidence to suggest that in-running betting has led to an increase in cheating offences they therefore do not believe that in-running puts the integrity of sports betting at risk. 2.65 One trade association commented that in-running betting raises all the same risks to the integrity of sport as other forms of betting, as a recent report from Salford University for the Central Council for Physical Recreation (CCPR) 3 identified. 2.66 One individual considered that although they did not believe in-running betting poses a specific risk or greater risk to integrity in sports betting, the potential for such enhanced risks did exist. They commented that instances where race callers announce the wrong horse, jockeys take the wrong course or ride to a different winning line could ultimately be used as a ruse to lay a particular horse in-running. Therefore, with this in mind they believe the Commission and the betting industry need to be aware of these risks when operating in-running markets. Problem gambling Consultation proposals 2.67 The Commission was interested in obtaining further information and evidence as to whether there is a potential link between in-running betting and problem gambling. The issues paper requested further information on whether the volume and repetition of betting by in-running betting customers points towards a potential risk for problem gambling, or whether this is just an inherent characteristic of this type of gambling. Consultation question Q 10. Does the nature of in-running betting raise specific issues or concerns about problem gambling? 3 Available on CCPR s website 13

Respondents views 2.68 From those that responded to this question, eight out of ten respondents did not believe that in-running betting raises specific issues or concerns about problem gambling. One respondent stated that in-running betting is a place for the more skilled gambler and as such is likely to be left alone by problem gamblers for the large part. 2.69 A betting operator was of the opinion that if a particular customer does develop a gambling problem it may be impossible to accurately attribute that problem to a particular aspect of their gambling as many customers use a range of gambling products. However, they did also state that from all the evidence they have seen from studies into problem gambling, none has raised specific concerns regarding in-running betting. 2.70 Another betting operator stated that when a customer closes an account they specifically ask the customer their reasons for doing this and there is no evidence to suggest any relation with problem gambling and in-running betting. 2.71 One individual felt that problem gamblers in the heat of the moment may turn to in-running betting to try and rectify their bad bets only to get themselves into more debt. 2.72 Another individual believes that as in-running betting is so widely available it could lead to problem gambling. They did, however, also believe that compared to other gambling products that were also freely available, but loaded in the operators favour, concerns around problem gambling in-running were small in comparison. Spread betting Consultation proposals 2.73 The Commission was keen to hear views on the comparative relationship between inrunning betting and spread betting. Although the Commission does not regulate spread betting (that is the responsibility of the Financial Services Authority), further information was requested on the popularity of spread betting and of the overlap in users of these two markets. 2.74 The issues paper further noted that the Financial Services Authority has its Conduct of Business rules whose overarching principles bear a significant similarity to how the Commission approach regulation of betting operators. The issues paper asked for further information and views on the regulation of spread betting and whether the Commission should aim to make regulation of in-running betting consistent with the protections in the rules set out by the Financial Services Authority for their customers. Consultation question Q 11. Do betting customers with traditional bookmakers and betting exchanges also take part in spread betting and is it a direct competitor to in-running betting? Respondents views 2.75 Responses to this question were varied with some respondents of the opinion that customers betting with traditional bookmakers and betting exchanges do also take part in spread betting and those respondents who did not agree this was the case. 2.76 One betting operator felt that customers generally bet with one or the other as spread betting was more of a niche product. One individual commented that while some do take part in spread betting they themselves did not as they understood odds and did not see the link to spread quotes. Another individual stated that they did not spread bet for the sole reason that it did not appeal to them. 14

2.77 A number of betting operators believed that a small number of betting customers did take part in spread betting and certain aspects of spread betting were analogous to in-running betting on a betting exchange. 2.78 The majority of respondents agreed spread betting was a direct competitor to in-running betting. One betting operator stated that the same markets are offered by both but are simply presented in different ways. 2.79 Another individual commented that as spread betting is a direct competitor all spread betting firms should be encouraged to have a definitive process in place for the acceptance of bets. They further commented that spread betting firms should be required to meet industry standards in the same way betting exchanges have to adhere to standards set down by the Gambling Commission. 2.80 One individual disagreed that they were direct competitors commenting that betting with a traditional bookmaker or betting exchange was very different to spread betting. Other issues around in-running betting Consultation proposals 2.81 The issues paper made clear that the Commission was not only seeking views on the above list of issues but also any further information or evidence regarding in-running betting and its impact on the licensing objectives. Consultation question Q 12. Is there any other issues relating to in-running betting that the Commission should be aware of and that you consider relevant? Respondents views 2.82 One individual believes the way forums are managed by betting exchanges is an issue. They stated that betting exchanges use their forums to promote in-running betting but at the expense of naïve customers. They state that betting exchanges allow customers to post messages on their forums regarding their alleged profit and leave these messages on the forum for a long period of time, which in turn helps to promote in-running betting but also misleads other clients. 2.83 Another issue which was raised was the transparency of information available to customers. One respondent stated that some betting exchanges will allow you to separate the profitability of one sport from another but not provide the same facility between bets placed on horseracing in-running compared to conventional pre-race betting. They suggested that any operator wishing to offer in-running betting can only do so if they provide a facility which allows customers to view separately bets placed in-running from pre-event betting. 2.84 One trade association believes that the Commission needs to update licence condition 15.1 on information sharing. They commented that in order for the Gambling Commission to operate a regulatory regime that responds to the risks to sporting integrity from all types of betting the licence condition on information sharing requires updating and strengthening. 2.85 The same trade association also raised concerns about the ways in which betting exchanges are used. They believed that some customers were trading as betting operators 15

through betting exchanges but were not licensed. They stated that individuals using devices such as bots were trading and as a result this situation must be addressed. 2.86 One individual commented that they would like the Commission to employ a full-time data analyst whose job it is to review historical data from the leading exchanges, spot trends and highlight any suspicious betting patterns. They believed the betting public should be made aware if any statistical correlation was found and be kept informed should an enquiry ensue. They also believed that should a data analyst be employed the betting public would be aware information was being analysed which would encourage greater fair play. 3 Conclusion 3.1 We are grateful to all those who took the time to respond to this consultation and who provided constructive arguments and evidence in response to the questions we posed. 3.2 The Commission has concurrently published, with this responses document, two related papers: a position paper on in-running betting and a position paper on betting integrity 4. Together, these papers form the basis of our recent work on aspects of betting as they relate to the licensing objectives. These three papers should be read together to provide the context and the updated policy position of the Commission. They are all available on our website. 4 Betting Integrity: Policy position paper (March 2009) 16

Appendix A List of respondents List of Respondents Category 1. Graham Pigott Individual 2. Harry Demetriou Individual 3. Rob Tattersall Individual 4. Douglas Kearney Individual 5. John Asquith Individual 6. Phil Curry Individual 7. Turf Trax Other 8. Nick Moore Individual 9. Betfair Operator 10. Name confidential Individual 11. Name confidential Individual 12. Mike Stadler Individual 13. Remote Gambling Association and Industry bodies Association of British Bookmakers Ltd 14. Betdaq Operator 15. Gala Coral Operator 16. The Magician Individual 17. British Horseracing Authority Industry body 18. Henry Spurway Individual Gambling Commission March 2009 Keeping gambling fair and safe for all For further information or to register your interest in the Commission please visit our website at: www.gamblingcommission.gov.uk Copies of this document are available in alternative formats on request. Gambling Commission Victoria Square House Victoria Square Birmingham B2 4BP T 0121 230 6666 F 0121 230 6720 E info@gamblingcommission.gov.uk 17 CON 09/04