What is a ‘Bookmaker’?
A Bookmaker is a person or company whose job it is to calculate odds on betting events, take bets and pay out winnings. Online bookmakers have become increasingly popular and most bookmaking organisations also have an online brand as well as high street stores. Bookmakers typically make money by adjusting the odds of a bet in their favor. Their main aim is to achieve a “balanced book”, which they do by receiving an equal number of bets for every outcome or by getting the amounts placed by betters on each outcome to reflect the odds.
There is a long history of bookmaking and bet-taking, but officially the role of “bookmaker” became legal in the 1960s. Bookmakers mainly focus on professional sporting events, in particular horse racing and football. However, bookmakers do take bets on a wide range of other events – including important political elections, award ceremonies, royal weddings and even novelty bets.
Bookmakers generally do not attempt to make a profit from the bets they take themselves but instead to profit by acting as “market makers” which allows them to make money regardless of the outcome of the event. A similar example would be an actuary – who balances financial outcomes of events for insurance industries.
Bookmakers were slow to capitalize on the rise of online gambling in the 1990s, due to the cost and complex nature of setting up legal online betting websites. Many small online bookmakers now purchase “white label” or “skins” from larger betting organisations to save on costs and also feature other online gaming options – such as poker and bingo – to customers alongside traditional bets.