Buying and selling positions on celebrities, television shows, presidential candidates and the like have been happening for some time now on the Internet. It is not at all uncommon today to see CNN or FOX News quote what a certain item is trading at on Intrade relating to a story they are doing. As of right now there are very few legal ways to bet these markets, but they are coming.
The Cantor Exchange is one such place (it is waiting for regulatory approval). Scheduled to start trading in April, this exchange will focus on (among other things) a movie market.
“Soon, everyone —I mean, everyone — will be able to bet on the boxoffice, and make or lose lots of money on the outcome.”
They will be using the web as it should be: to viral market buzz. It is speculated that studios, as part of their advance marketing, will try and use a service like this to create buzz about a new film, making sure it is trading at a fairly high price. This would be nothing new. It has been speculated that some presidential candidate supporters have done similar on intrade in the past.
Markets like this struggle for volume, but with studios encouraged to participate (and creating inefficiencies at the same time), it sets the table for a ready-made market; one which the public will participate.
Betting via the internet has been left to horse racing alone in the past few years (legally anyway) and this is yet another new competitor for online betting dollars. With a foot in the door it is not out of the realm of possibility that Cantor can build a brand, economies of scale, and foster more and more political connections whereby if new forms of wagering are allowed for a trading market, they will be first past the post.
This, to my knowledge, is a first for the US in a very public way. In Canada, it was announced recently that governments in Quebec and British Columbia, are looking at online poker, so the ship appears to already have sailed north of the border.
It has struck many web observers who are race fans as flummoxing that racing has not used their monopoly to expand into some of these areas earlier this decade. Betfair had been growing with similar bets and it looked to be a revenue driver of some sort for racing overseas over 8 years ago. Using racings political clout to get regulatory approval for a betting market, where they could easily expand into Oscar betting, sports betting, presidential betting and so on should they get things approved as Cantor appears to have gotten done, would have given racing a new revenue source in North America. This would have been cutting edge of course, and in a growth betting sector, unlike slots money which is becoming watered down and older. As well, they would have already staked ground in the sector and if new entrants pop up they would have a hard time cutting into racings markets, because of the volume and goodwill gained by being first in the space.
It is water under the bridge now perhaps, however it still brings up a couple questions for racing.
* If Cantor can do this for movies, what stops TVG/Betfair from doing it for racing?
*Would some enterprising racing organization make a move in this sector, and could they succeed if they started right now by setting up a racing exchange? For example, if Kentucky is not giving racing slots, could Keeneland and CDI be approved for such an exchange as a political act of goodwill from lawmakers? With a built -in betting market and customer base (eg horse race bettors enjoy the chase and are much like other sports bettors) they would be far ahead of any onshore competition.
Those are clearly questions out of our scope, with this space guarded by myriad state and federal laws. However, if Cantor can get it done for something like box office receipts, perhaps this is something we should learn more about.
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How many times do I have to pay to watch my own movie before I win?!!
Given the success of celebrity sites like TMZ, I can see this taking off.
I know old timers at the corner bar that handicap the races…but they get drunk regularly and their betting activity turns to cutting a deck of cards and the high card wins. There are lots of ways to adding betting opportunities to daily life but it doesn’t mean they are quality betting activities and without quality, nothing survives.
I was bemused a few posts back Dean when you talked about the Ipad. As a member of the “older demographic” I am married to my past performances. Studying the PP’s for hours a week is a window into the why’s and how’s and who’s of winning at the track. It’s what turns my betting activity into an intellectual pursuit and seperates it from buying scratch tickets. I take exception to the idea that PP’s are some relic of the past that only the “older demographic” care about.
Ok, good stuff here at r2 collective. Enough ranting from a near term AARP member.
Hi Turk,
PP’s are difficult to give up in traditional form for people of any age. I actually brought up the idea of the Ipad because I was reading a thread on a chat board where people (yes some older people :)) were chatting about how they read them on their handhelds and kindle now. I was kind of floored, because it seems so hard to do when you are used to something like the drf.
From the post recently we had here called “positioning”, I could not agree more about the rest of your thoughts. This is (in my opinion) bar none the most interesting and challenging mental mind game in all of betting.
dt