James Moore: Betfair sees the odds written on the wall
James Moore is the Independent's Associate Business Editor and writes the Outlook City comment column from Tuesday to Friday. He also has a keen interest in disability issues and when not attempting to further injure himself playing wheelchair basketball.
Thursday 13 December 2012
Outlook Breon Corcoran today waved a white flag that Betfair ought to have hoisted a long time ago.
He's decided to pull out of European countries where the legality of what the company does is questionable.
It has taken a long time for this business to realise that operating where it's not wanted is about as smart as those punters who continue to use its services to back England's dysfunctional football team to win the World Cup.
Gambling companies see the consequences of taking bad risks all the time. The gambler plays the same game again and again, in the sure knowledge that the odds are rigged in the bookie's or the casino's favour. It's the thrill that keeps them going.
Companies like Betfair should know all about this, and you'd think they'd steer clear of that sort of behaviour themselves. If so, you'd be wrong.
For years those parts of the industry specialising in internet gambling have happily taken bets from people in countries where it is either illegal to do so, or of highly dubious legality.
Time and again managers have presented lots of clever arguments about why their investors shouldn't be worried about this; and time and again when they've been on planes that have touched down in the wrong country those managers have ended up in jail.
For gambling companies, going where you're not wanted is a hazardous activity.
But executives keep on trying to push at the boundaries. It's the thrill that keeps them going.
Betfair is by no means the worst offender here. Others have taken far sillier gambles, and paid the price. Mr Corcoran has seen the writing on the wall.
In addition to the retreat from certain parts of Europe, he's planning to streamline and slim down the operation. It seems he wants to clear some of the hurdles Betfair has been tripping up at.
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