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  • 2018
  • Working Paper
  • HBS Working Paper Series

Platform Competition: Betfair and the U.K. Market for Sports Betting

By: Ramon Casadesus-Masanell and Neil Campbell
  • Format:Print
  • | Language:English
  • | Pages:23
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Abstract

We examine two episodes of strategic interaction in the U.K. betting industry: (i) Betfair (an entrant multi-sided platform or MSP) vs. Flutter (also an MSP), and (ii) Betfair vs. traditional bookmakers. We find that although Betfair was an underfunded second mover in the betting exchange space, it was able to attract punters at a much faster rate than the better-funded first mover, Flutter. Moreover, while Betfair and traditional bookmakers competed aggressively for market share, they also developed a highly complementary relationship that favored all parties. We discuss implications for research in the economics and management of MSPs. Specifically, we argue that the literature would benefit from work that endogenizes platform design and that considers the possible competitive and cooperative interactions between the business models of traditional incumbents and those of potential innovative MSP entrants.

Keywords

Platform Design; Betting; Multi-Sided Platforms; Design; Network Effects; Business Model; Competition; Cooperation; Market Entry and Exit

Citation

Casadesus-Masanell, Ramon, and Neil Campbell. "Platform Competition: Betfair and the U.K. Market for Sports Betting." Harvard Business School Working Paper, No. 19-057, November 2018. (Forthcoming in The Journal of Economics and Management Strategy.)
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About The Author

Ramon Casadesus-Masanell

Strategy
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