How Betfair 40 to 60% Premium Charge will affect bettors
I have listed below what the official statement of betfair is on the Premium charge but as a layman I find it very hard to see people digesting it well. Is this sign of monopoly trying to flex its muscles or is this a sign of a desperate company trying anything to try to get the shares to move in the right direction. Any thoughts on what this means for the industry as a whole and do you think betfair is prepared for the backlash.
This is what betfair site says
“From 18th July 2011 Betfair will be making some changes to the Premium Charge. The current Premium Charge mechanism will remain in place but higher rates may now apply to a small number of customers (less than 0.1% of annual active customers).
Full details of the changes can now be found on the Betfair Charges page under the About Us section of the website. However, the changes can be summarised as follows:
• Customers will only be subject to Premium Charges at higher rates if they satisfy all of the following conditions:
o Lifetime net profits* exceed £250,000
o Lifetime commission generated less than 40% of lifetime gross profits
o Bet in more than 1,000 markets
• Customers that satisfy all of the above conditions will be asked to pay Premium Charges at rates between 40% and 60% on all future exchange activity.”
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