Nigel Eccles:
How did you forget yadda yadda yadda. [ Hilarious. 
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Nice list, roughly makes sense but lots to disagree with (as you would expect). However one clear mistake is BetFair. They should be valued at $3 billion. They just did a recapitalisation which distributed 10% of the company in cash to shareholders (I got the check this morning). It was at a valuation of ?1.5 billion, so unless you are even more bearish on the exchange rate that works out at $3 billion.
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Henry Blodget:
Thanks for the info on Betfair–-that’-s exactly the sort of concrete detail we’-re especially looking for. We’-ll see if we can confirm, and, if so, the valuation will drop to $3 billion.
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And there’-s another interesting comment, on the other page:
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Insider:
why the gratuitous —- and painfully ignorant – -swipes at the USA?
can’-t you do your job without the silly —- and, again, factually incorrect —- morals lectureds and editorializing?
actually the U.K. is one of the few countries in the world where online gambling is essentially legal (though the U.K. still hasn’-t sorted out all the laws it is creating to govern online betting)
many EU countries are literally at each others throats about how/when to tax internet gambling (principally because state-run lotteries are specifically carved out of the E.U. free trade agreements)
japan, australia and china have sever and horrible and harsh punishments for internet gambling
of course, pretty much all of the islamic world puts people to death or dismemberment for breaking qu’-ran-ic law – and gambling is totally and utterly forbidden under the qu’-ran
it is you who are “-of arbitrary morals”-. stick to blogging.
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Insider’-s comment sounds informed, but he/she should have avoided the nasty last line.
“-Stick to blogging”- is an insult I was served with, recently, (by a UK-based financial trader), so I can relate. But that’-s never helpful. Educate that blogger, instead. You’-ll get a better ROI, believe me.
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That these guys afforded Betfair a valuation of five million dollars, calls into question their entire methodology. Was it a case of skewing the valuation to suit the accompanying hype. A true valuation of Betfair, based on its 2007 earnings, and taking into account market valuations currently ascribed to other gambling companies, would be somehwere in the region of 2.5 billion dollars.
Any moron should be able to perform the calculation on the back of a fag packet. Doubling Betfair’s valuation in order to make the company seem more like a super duper high tech silicon valley like company, does not do Betfair, nor the authors, any favours.
@P Benckendorf: Surely. However, my mentioning of SAI25 in the first place has to do with the fact that, finally, the US (and the US high-tech industry) acknowledges BetFair. Whether the figure is 5 or 3 or 2.5 does not ruin the party, for me. As long as BetFair is in the list.
I think there is still room for BF to be displaced from its current monopoly. Thing is tho that BF customers are fairly price inelastic (a match odds market with 5% commission will attract heavy money, whilst an identically framed asian handicap, offering in essence an identical bet, at just 1% commission, will attract hardly any money).
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I do think a p2p portal will be possible, better for punters overall, but highly unlikely to come into place the way that music and video/torrents have sprung up.. However, taking 5% commission may well become an anachronistic margin. No financial market would have brokers charging 5%.
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BF’s valuation at $3bn is interesting. Facebook came miles later than Friendsreunited, but totally stole their thunder. BF can compete on an IT front, but it will be interesting to see what there is out there that can provide better value for consumers.
@Ed Murray: “there is still room for BF to be displaced from its current monopoly.” I don’t think so. I think the network externalities are very strong and play in favor of BetFair in the UK.