Bookmaking can be a competitive industry in terms of placing bets and balancing wagers to make a profit. Bookies have to carefully balance their customer’s bets in order to ensure the outcome of the event will still result in dividends for the bookie himself. However, the greatest competition for bookmakers comes from the previously discussed group of betting exchanges.

Exchanges and Bookies

Since betting exchanges eliminate the need for the middle man in the bookmaking industry, the exchanges can offer up to 20 percent more competitive prices than bookmakers can. This can be largely appealing to people who normally place bets, who are usually in a decent position but will not likely turn down a cheaper option to place a wager.

Bookmakers are arguing against the betting exchanges, where much of the competition for business arises. This is a particularly hot issue in the United Kingdom, where bookmaking is legal and betting on events is a popular pastime. In the U.K., betting exchanges are also legal and a great source of contention among bookies. Bookies argue that betting exchanges do, in effect, act as bookmakers, and that therefore they deserve to be required to get a license just as the bookmakers are.

Bookmakers also say betting exchanges have the potential to place bets anonymously, which can affect the outcome of the event and thus undermine the integrity of betting. Yet the British government refuses to eliminate betting exchanges. In fact, the government has attempted to further deregulate gambling, although unfair practices can still be inhibited by the gambling commissions.

As long as betting exchanges are present, they will present a fair amount of competition to the bookmakers who make their profit through their occupation. Betting exchanges often counter the bookmakers claims. They say the exchanges only offer a mere basis for bettors to exchange their money and wagers. They compare their services to a telephone company who offers telephone lines but does not require the customers to use them. Yet the competition between exchanges and the bookies does not appear to be dying down at any time soon. Whichever method of betting people prefer is up to them in the long run.