Betfair US to Launch New Jersey Exchange May 10
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For the first time exchange wagering will be available in the U.S. when Betfair U.S. launches a platform for New Jersey residents May 10.
On April 21 Betfair US and Monmouth Park operator Darby Development announced the launch date for the betting form that allows players to offer and accept odds on horses, an exchange. The betting form is made possible by a high-tech Internet and mobile platform. Some of the attractions for players include in-race wagering and the ability to lock in odds, essentially making a fixed-odds type of wager.
Betfair pioneered the exchange 15 years ago in England. Betfair now processes on average more than three million transactions each day.
Bettors in New Jersey will be using a separate platform that will be restricted to horse race wagering on Monmouth Park and Meadowlands along with other tracks who reach agreements with the New Jersey exchange to offer their signals.
Monmouth, which begins its summer racing season May 14, will highlight the tracks offered to players on the exchange. Betfair launched a closed beta version of its platform available to its 4NJ-BETS customers on April 18 2016. Betfair has developed a simulator for U.S. audiences to experience the exchange.
"We are excited to be launching exchange wagering in New Jersey with our local horseracing stakeholders," said Betfair US chief executive officer Kip Levin. "Our experience in the UK and other markets has proven that exchange wagering is an attractive prospect for consumers and that it can bring new customers, increase engagement, and new revenue to horse racing."
Exchange wagering has received criticism in other countries for not returning enough money to the sport. The New Jersey platform will feature a takeout rate of about 12% on winning wagers. While it's unclear exactly how money will be divided among Betfair US, New Jersey tracks, and purses, the rate was negotiated by Betfair US, the tracks, and horsemen.
Betfair US said tracks that allow their signals to be offered on the platform have negotiated their own deals, similar to contracts with advance-deposit wagering platforms and simulcast partners.
Dennis Drazin, president of Darby Development, said the performance of the exchange will be closely monitored but he's looking forward to its launch.
"We need to embrace technology for horse racing to attract new participants, new customers and new revenue streams and we are confident that exchange wagering can help us do that," Drazin said. 'We think this can be a net positive for our industry and that it can complement traditional wagering."
The New Jersey Racing Commission will have oversight of the new form of betting. Betfair US has said it will give the regulator real-time access to monitor its betting pools.
The Jockeys' Guild has raised concerns about the new betting form because of the opportunity for bettors to essentially bet against horses to win.
According to Betfair's consumer research, exchange customers are generally much younger and more tech-savvy than the demographic profile of horse racing fans in the US.
Exchange wagering was first authorized for the state's residents by the New Jersey Legislature in 2011. Betfair was licensed by the state to conduct exchange wagering in November of 2015 as a service provider to the NJSEA (New Jersey Sports and Exposition Authority) and Darby Development, the exchange wagering manager.
Betfair, which owns the Los Angeles-based horse racing television network and advance deposit wagering platform TVG, also operates 4NJ-BETS and Betfair Casino in New Jersey.