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buckle up i do believe the great american in-play arbfest has officially begun
Here's the situation. There are multiple independent in-play odds providers for American sports (let's talk football because it's now and it's the best example). Each of these incumbent providers regularly, and that means many times per game, offers 5% to the good or better bets.
(i.e., 57-58% on a -110 bet)
These line errors come from various sources but basically its:
* Bad/slow gamestate data
* Not accounting for relevant information (e.g., injury)
* Bad models
* Some trading lean
* THIS IS HARD TO DO WELL
These line errors come from various sources but basically its:
* Bad/slow gamestate data
* Not accounting for relevant information (e.g., injury)
* Bad models
* Some trading lean
* THIS IS HARD TO DO WELL
There are tons of operators jockeying for market share, and it already is and will increasingly be important for operators to offer a good in-play product.
In the past, operators have dealt with shaky in-play products by locking them down... long delays, lots of rejections, etc
In the past, operators have dealt with shaky in-play products by locking them down... long delays, lots of rejections, etc
There will be competitive pressure to ease these lockdowns. Product matters. In the end these companies need their customers to be able to bet.
Also in the short term as we are in the gold rush expansion phase with nosebleed equity valuations...
Also in the short term as we are in the gold rush expansion phase with nosebleed equity valuations...
...the incentives are clearly there to boost perceived market share... and that means handle... even at the expense of hold%. The people making the 10-figure deals will care about market share and eyeballs more than hold%.
All this means over the next two years I highly expect these companies increasingly to start letting people just go ahead and bet into their in-play products.
Also, THIS IS VERY HARD TO FIX. Many operators have locked themselves into multiyear deals with their providers of choice. The providers are trying to solve a HARD PROBLEM and will have trouble fixing it, esp in the turnaround time required once the enormity of the problem hits.
A good in-play product is a marriage of quality data, quality modeling, quality risk-management, and serious domain knowledge ( @mdkentrepreneur caught an error we made in the Dallas game because we didnt give Dallas a high enough chance to go for 2 after a TD when we made a line)
Some providers may try to scrape their way out of the problem at first, but this is very much a band-aid. First, it will at best only fix the main markets and not the deeper stuff. Second, who to scrape??? Third, latency.. scraping in real-time ultimately is too slow.
tl;dr American in-play odds products are absolutely chockablock full of line errors, it's a multi-year problem to fix, and there will be intense competitive pressure for operators to just let people bet into the stuff even when they know it's no good.
