betfair ed p58,59,60,62,63

8/4/2019 Betfair Ed p58,59,60,62,63

http://slidepdf.com/reader/full/betfair-ed-p5859606263 1/5

ENTERTAINMENT

58 www.cxo.eu.com

8/4/2019 Betfair Ed p58,59,60,62,63


www.cxo.eu.com 59

Betting on a sure thing

It’s a Tursday morning in July at Betair’s headquarters in Hammersmith, London, overlooking the River

Tames. iger Woods has just teed o at the British Open on a windswept urnberry course whi le England’s

cricket team is about to lock horns with Australia in the second test match o the Ashes. Tere’s a buzz in

the trading room as call handlers match bets rom punters over the phone while arm-chair gamblers ‘back’

and ‘lay’ (see page 58) on Betair’s website. Computer screens in the room are a renzy o activity as money

rom all over the world comes pouring in or iger who is now a clear 2/1 avourite. oday’s going to be one

o the busiest betting days o the year.

Betair currently boasts more than two million registered customers rom more than 140 countries.

At peak periods the site has to be robust enough to stand up to 450,000 page views per minute and 1000

bets a second. Keeping this extremely complex site running smoothly 24/7 is the responsibility o the company’s ebullient

American CO ony McAlister. Although having only been in the tech hot seat or six months, McAlister is relishing the

job so ar and the technology challenges ahead as Betair looks to penetrate new markets around the world. He is also in aweo what ounders Andrew Black and Ed Wray have created in nine years, turning the company rom internet upstart into

the world’s largest betting exchange with a 90 percent share o the market. “I get to stand on the shoulders o giants, as Isaac

Newton once wrote,” McAlister explains. “What the company does today is because Ed Wray and Andrew Black created the

exchange nine years ago, which is a pretty incredible oundation or me to build rom.”

When the company launched in June 2000 just UK£30,000 was matched between punters on the opening event – the

Oaks horse race. Fast orward to July 2009 and a wallet-busting UK£53 million was matched on the ve-set thriller between

Roger Federer and Andy Roddick in the men’s Wimbledon nal. Tis was a record or Betair. “Te volume [o bets] here

is astronomical,” McAlister enthuses. “Tis creates the obviously huge challenge o maintaining the appropriate level o

uptime and response time or our customers.” And while the site started lie as a sports exchange, Betair now houses an

online casino, poker room, games and more. Unsurprising, the role was somewhat o a baptism o re or McAlister who

With around 6.4 million transactions completed every day,

online betting exchange Betfair is busier than all of Europe’s

stock exchanges combined. It’s a British phenomenon born in

the aftermath of the dot.com crash that has become a red hot

favourite among shrewd punters. Julian Rogers goes behind

the scenes and meets CTO Tony McAlister.

8/4/2019 Betfair Ed p58,59,60,62,63


has 30 years’ experience in systems development in non-gaming related

industries across Europe and the US.

He admits that although he enjoys sports, the only wagers he has

ever struck were in his homeland on casino blackjack or the odd game

o poker. Getting his head around how the exchange works, the markets

and gaming on oer, as well as gambling rules and legislation, was ini-

tially a tough hurdle. “It’s been a pretty steep learning curve,” he admits.

“However, I am more excited about the job today than when I rst took it ,

mainly because o what I have learned about the industry, the company

and the growth possibilities, as well as the tools and the pretty amaz-

ing people I have here to help solve problems.” He also reveals that his

impression during the interview process was that this was more o a

technology company than a betting company. “Aer six months I can

strongly say this is indeed what it is.”

Place your bets nowFor McAlister and

his customers, speed is o the essence. A signicant

chunk o betting activity on

the site occurs ‘in play’ right

up to the nishing line or the

nal whistle. But while cricket

matches can last ve days,

other sports like a ve-urlong

HOW IT WORKS

At Betfair punters with differing opinions on an

outcome can wager with each other instead

of using a traditional bookmaker. For instance,

John thinks footballing giants Barcelona (2/1) will beat

a star-studded Real Madrid in the Spanish capital. He

wishes to bet €10 at 2/1, which will return €20 plus his

€10 stake (€30 in total). On the other hand, Jack believes

Barcelona won’t emerge victorious so ‘lays’ (accepts)

John’s €10. If Barcelona lose or draw he pockets the €10

but if they win he pays John €20 as well as his original

€10 bet. Betfair then charges commission of between

two and ve percent (commission is reduced the more

you use Betfair) on winning bets.

If you don’t fancy the odds on offer

you can ask for a better price. Likewise,

you can determine what odds you

offer when you lay a selection. It’sthen up the other players whether or

not they chose to place a bet with

you. More importantly, because you

are betting with individuals you can

often get better odds than those on

offer with a bookmaker who has to

factor a prot margin into his odds.

At Betfair all bets are matched

anonymously with gamblers all over the

world and you can wager on a bewildering array of

markets (9700 a week) – from popular sports and events

like horse racing and tennis to the more obscure such as

water polo and this summer’s hottest temperature.

In-play betting: not forthe faint-hearted

60 www.cxo.eu.com

8/4/2019 Betfair Ed p58,59,60,62,63


62 www.cxo.eu.com

horse race lasts around one minute rom start to nish. Punt-

ers will be backing, laying and trading their positions in play

as the sprint unolds. “Speed is key because I have to get those

bets matched very quickly or the customer,” he explains.

“When [David] Beckham steps up to take a penalty people

will be trading their positions at this point so i I am a second

late the shot has already been taken.”

Betair claims that 99.9 percent o all transactions are

executed in less than a second – the average time is 23 mil-

liseconds. Te complex I inrastructure powering Betair is

an Oracle database. In act, the Ca liornia-based rm rates

Betair as one o it’s top ve customers, alongside the likes

o eBay and Google. “I have some o the most sophisticated

Oracle PL/SQL developers in the world,” says McAlister. “We

push that database probably as hard as any Oracle customer,

which creates a lot o opportunities rom this database that

they don’t get to see rom their other customers.”

As well as his engineering team at Betair HQ, McAlisteralso has 65 local developers and sta at his disposal in the

Romanian city o Cluj, dubbed the Silicon Valley o Eastern

Europe. Tis Betair-owned acility is responsible or around a

quarter o the company’s development projects and is ocused

on innovations. “We have given them some o our product sets

to build and it is our intention to double the size o the team in

the next couple o years. It is also allowing me to stretch my development

team outside o London and I am looking at other parts o the globe too.”

McAlister recently returned rom Romania to welcome the team onboard

and spent a ew weeks in the US in June interviewing people with a view to

expanding a technical team across the pond.

The right architectureTe globalisation o the back-oce unctions mirrors the exchange’s

desire to crack new markets as it becomes an increasingly recognised

player and international brand. However, McAlister is orced to create

what he calls “jurisdictional architectural” due to the legal constraints o

Now and then

“One of the things both I

and the company believe

in is investing in a businessduring a downturn”

oftware engineer and

ormer professional

ambler Andrew Black

ormulates the idea

f being able to buy

nd sell, or back and

y, sporting event

utcomes in a similar

ashion to buying and

elling shares

9982000 Site launches with its rst

market being the Oaks horse race,

won by Love Divine. UK£30,000 is

matched on the race

2003 Betfair wins the Queen's Award

for Enterprise, in the Innovation

category, on the recommendation of the British Prime Minister

First in-play market

offered on UEFA cup

nal between Alaves and

Liverpool. Betfair merges

with rival Flutter.com

2001

Tony McAlister

8/4/2019 Betfair Ed p58,59,60,62,63


www.cxo.eu.com 63

ability to do this?’. Keeping your eye rmly on what the business is tr ying

to achieve and not being distracted by your ‘I blinkers’ is key. Indeed,

McAlister says he always “stays close” to the business.

“I have been in technology almost 30 years now but I have always

viewed mysel as a business person rst and oremost. I work directly

with the business and get to know it very well and work closely with my

commercial counterparts. I attend all o their meetings, stand in there

and do strategy sessions with them, and these might not have anything

to do with the technology itsel.”

Back a winnerAs the interview winds up I pick McAlister’s brains on how the

blackening recession will impact on Betair and its technology unctions.

When a recession bites people will look to curb their expenditure

and gambling could be one pleasure to get the chop. McAlister

believes however that the company will emerge rom the

downturn stronger and healthier, which is why invest-

ment in I people and technology is being made now.“One o the things both I and the company believe in is

investing in a business during a downturn,” McAlister

suggests. “Te whole world knows the market now is in

a pretty dicult nancial situation. Betair is cautiously

optimistic that we are doing OK and we do believe the

market will turn around. My goal is that when we come out

o this recession, we will have a stronger architecture, better

products and services, a more ecient development process and

have a globally dispersed technology team.”

Staying in tune with where the business is heading and its require-

ments will be paramount or this I chie. “I need to align my technical

architecture with the business architecture so I have got to build an in-

novative platorm that can change quickly into dierent shapes and sizes

that I cannot even see today.”

In case you were wondering, iger Woods struggled with the inclem-

ent weather and crashed out o the British Open beore the third day’s

play. Tis time the layers got it right and bagged some juicy prots. n

operating a betting exchange in certain countries. “As we expand globally

we realise that we need to build our solutions and products and services

so that they can easily be turned on or o depending on the regulatory

requirements. Tereore, I have to make sure my technical architecture

matches the business architecture and go into a region and use one prod-

uct but not another and then a dierent product in another region. Tat

has created a pretty dicult challenge or the technology department

here.” McAlister has spent a great deal o time recently in the company

o Betair’s legal team and the regulators to better understand what he

can and cannot do in certain regions. Te company plans to overhaul its

platorm in order to react nimbly to legal changes in countries where it

does not yet operate. Te idea is or a ‘Betair in a box’ system that can be

rolled out should laws allow Betair to enter.

One medium McAlister has been keen to get his teeth

stuck into is Betair Mobile. Tis stripped down ver-

sion o the site allows users to place bets and check

odds through their internet-enabled mobile

phones. And with previously experience as COo Vodaone’s mobile content division, he is

condent he can leverage its power. “Mobile is

a perect example o what was traditionally in

the internet boom, around 1999/2000, one-to-

one marketing. With mobile I really can do that

because you have that computer in your pocket and

I can get to you anywhere you are and likewise you can

get to me.” He continues: “I want to leverage mobile and

use the power o the exchange to push our mobile products more

strongly than most people are doing today.”

With all o these back-oce and customer-acing technologies on

his plate, it’s clear to see why he eels Betair is more about technology

than gambling. And while his remit is to align the I architecture with

the business architecture, he has ound technology can prove to be a real

game-changer. “Sometimes because the company is very technically o-

cused and very innovative, the technical architecture can infuence the

business architecture. I can go to them and say ‘do you know I have the

At peak periods up to

1000bets are matched

every second

Successfully migrates 300,000

customers to Betex, its new

platform. Also hosts its rst

online poker tournament withUK£100,000 prize money

2004

2005 Named the UK's seventh

fastest-growing technology

company in The Sunday

Times Tech Track 100. Betfair

is granted a licence in Austria,

its rst outside the UK

2006 French, Bulgarian and

Czech language sites are

added, taking the total to 18

worldwide. An online casino

launched

2008 Registers its two

millionth customer. Wins

an unprecedented second

Queen's Award for Enterprise,

this time in the InternationalTrade category

A record UK£53

million is matche

on the men’s na

Wimbledon betw

Roger Federer and

Andy Roddick

2009

betfair ed p58,59,60,62,63

Documents