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Claims  |
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I claim:
1. A computer-based data processing system for maintaining a betting pool
during a contest, the betting pool having certain fixed betting terms,
comprising:
central processor means for processing data;
storage means for storing data;
first means for calculating an imbalance of the betting pool;
second means, responsive to the first means, for determining on the basis
of predetermined criteria whether to change the certain fixed betting
terms; and
third means, responsive to the second means, for changing the certain fixed
betting terms.
2. A computer-based data processing system for maintaining a betting pool
during a contest, the betting pool having certain fixed betting terms,
comprising:
central processor means for processing data derived from the betting pool;
storage means for storing data representative of the certain fixed betting
terms;
first means for calculating an imbalance of the betting pool;
second means, responsive to the first means, for determining on the basis
of predetermined criteria whether to change the certain fixed betting
terms; and
third means, responsive to the second means, for changing the certain fixed
betting terms.
3. A system as claimed in claim 1 or 2, wherein the first means comprises
means for calculating a total dollar imbalance of the betting pool.
4. A system as claimed in claim 3, wherein the first means further
comprises means for calculating a total percentage imbalance of the
betting pool.
5. A system as claimed in claim 4, wherein the first means further
comprises means for calculating a dollar imbalance of the betting pool for
a period less extensive than a total extent of the contest and for
calculating a percentage imbalance of the betting pool for the period.
6. A system as claimed in claim 5, wherein the first means further
comprises means for calculating a ratio of the percentage imbalance of the
betting pool for the period to the total percentage imbalance of the
betting pool.
7. A system as claimed in claims 1 or 2, further comprising:
fourth means for receiving data concerning time intervals elapsed during
the contest; and
fifth means for receiving data concerning scoring that occurs during the
contest;
wherein the second means is further responsive to the fourth means and the
fifth means.
8. A system as claimed in claims 1 or 2, wherein the certain fixed betting
terms comprise odds of a first contestant winning over a second
contestant.
9. A system as claimed in claims 1 or 2, wherein the certain fixed betting
terms further comprise a handicap for a first or a second contestant.
10. A system as claimed in claims 1 or 2, wherein the certain fixed betting
terms further comprise odds of a first contestant winning over a second
contestant and a handicap for a first or a second contestant.
11. A system as claimed in claims 1 or 2, further comprising means for
determining a present value for a bet and for allowing a first user to
transfer the bet to a second user.
12. A system as claimed in claims 1 or 2, wherein the betting pool is one
of a plurality of betting pools for the contest.
13. A system as claimed in claim 12, wherein one or more of the plurality
of betting pools has other fixed betting terms that are different than the
certain fixed betting terms of another of the plurality of betting pools.
14. A system as claimed in claim 13, wherein one or more of the plurality
of betting pools represents a different type of bet from another of the
plurality of betting pools.
15. A system as claimed in claims 1 or 2, further comprising means for
determining on the basis of predetermined suspension criteria whether to
suspend or terminate betting on one or more contestants.
16. A system as claimed in claim 15, further comprising terminal means,
connected to the central processor means, for allowing a user to enter
data into the system.
17. A system as claimed in claim 16, further comprising optical character
recognition means, connected to said central processor means, for
inputting data into the system.
18. A system as claimed in claim 17, further comprising printer means for
printing data.
19. A system as claimed in claim 18, further comprising display means for
displaying data.
20. A system as claimed in claim 19, further comprising television
distribution means for distributing data representing television signals
to the terminal means.
21. A system as claimed in claim 20, further comprising television
distribution means for distributing data representing television signals
to the display means.
22. A computer-based data processing system for maintaining a betting pool
on a contest, the betting pool having certain fixed betting terms,
comprising:
central processor means for storing the data derived from the betting pool;
storage means for storing the data derived from a betting pool and data
representative of the certain fixed betting terms;
first means for calculating an imbalance of the betting pool, comprising
means for calculating a total dollar imbalance of the betting pool;
means for calculating a total percentage imbalance of the betting pool; and
means for calculating a dollar imbalance of the betting pool for a period
less extensive than a total extent of the contest and for calculating a
percentage imbalance of the betting pool for the period;
second means for receiving data concerning time intervals elapsed during
the contest;
third means for receiving data concerning scoring that occurs during the
contest;
fourth means, responsive to the first, second, and third means, for
determining on the basis of predetermined criteria whether to change the
certain fixed betting terms; and
fifth means, responsive to the fourth means, for changing the certain fixed
betting terms.
23. A computer-based data processing method for maintaining a betting pool
on a contest, the betting pool having certain fixed betting terms,
comprising the steps of:
(a) processing data regarding a wager made during the contest;
(b) calculating an imbalance of the betting pool; (c) determining on the
basis of predetermined criteria whether to change the certain fixed
betting terms; and
(d) changing the certain fixed betting terms based on the determination
made in step (c).
24. A computer-based data processing method for maintaining a betting pool
on a contest, the betting pool having certain fixed betting terms,
comprising the steps of:
(a) automatically processing data regarding a wager made during the
contest;
(b) calculating an imbalance of the betting pool for the contest;
(c) determining on the basis of predetermined criteria whether to change
the certain fixed betting terms; and
(d) changing the certain fixed betting terms based on the determination
made in step (c).
25. A method as claimed in claims 23 or 24, wherein step (b) comprises
calculating a total dollar imbalance of the betting pool.
26. A method as claimed in claims 23 or 24, wherein step (b) further
comprises calculating a total percentage imbalance of the betting pool.
27. A method as claimed in claims 23 or 24, wherein step (b) further
comprises calculating a dollar imbalance of the betting pool for a period
less extensive than a total the contest and for calculating a percentage
imbalance of the betting pool for the period.
28. A method as claimed in claims 23 or 24, wherein step (b) further
comprises means for calculating a ratio of the percentage imbalance of the
betting pool for the period to the total percentage imbalance of the
betting pool.
29. A method according to claims 23 or 24, further comprising, following
step (b) and preceding step (c), the steps of:
(b)(i) receiving data concerning time intervals elapsed during the contest;
and
(b)(ii) receiving data concerning scoring that occurs during the contest.
30. A method according to claims 23 or 24, wherein the certain fixed
betting terms comprise odds of a first contestant winning over a second
contestant.
31. A method as claimed in claims 23 or 24, wherein the certain fixed
betting terms comprise a handicap for a first or a second contestant.
32. A method according to claims 23 or 24, wherein the certain fixed
betting terms further comprise the odds of a first contestant winning over
a second contestant and a handicap for the first or the second contestant.
33. A method as claimed in claims 23 or 24, further comprising the step of
determining on the basis of predetermined suspension criteria whether to
suspend or terminate betting on one or more contestants.
34. A computer-based data processing method for maintaining one or more
betting pools on a contest having two contestants, each of said betting
pools having certain fixed betting terms for each of the contestants,
comprising the steps of:
(a) displaying the certain fixed betting terms for each of the contestants;
(b) inputting data regarding a wager, made during the contest, on one of
the contestants in one of said betting pools;
(c) measuring an imbalance of the one of said betting pools for which the
wager is made;
(d) determining on the basis of predetermined criteria whether to change
the certain fixed betting terms of the one of said betting pools for which
the wager is made;
(e) changing the certain fixed betting terms of the one of said betting
pools for which the wager is made based on the determination made in step
(d) in order to induce a betting pattern that will tend to result in
balancing the one of said betting pools for which the wager is made;
(f) determining whether to suspend wagering on one or both of the
contestants; and
(g) returning to step (a).
35. A computer-based data processing system for maintaining one or more
betting pools on a contest having two contestants, each of said betting
pools having certain fixed betting terms for each of the contestants,
comprising:
central processor means for processing data derived from said betting
pools;
storage means for storing data representative of the certain fixed betting
terms for each of the contestants;
means for displaying the certain fixed betting terms for each of the
contestants;
first means for inputting data representing a wager, made during the
contest, on one of the contestants;
second means for measuring an imbalance of the one of said betting pools
for which the wager is made;
third means for determining on the basis of predetermined criteria whether
to change the certain fixed betting terms of the one of said betting pools
for which the wager is made;
fourth means, responsive to the third means, for changing the certain fixed
betting terms of the one of said betting pools for which the wager is made
in order to induce a betting pattern that will tend to result in balancing
the one of said betting pools for which the wager is made; and
fifth means for determining whether to suspend wagering on one or both of
the contestants.
36. A feedback control system for balancing one of one or more betting
pools on a contest having two contestants, each of said betting pools
having certain fixed betting terms for each of the contestants, by
changing the certain fixed betting terms for said one of one or more
betting pools to induce a betting pattern that will tend to result in
balancing said one of one or more betting pools, comprising:
central processor means for processing data derived from said betting
pools;
storage means for storing data representative of the certain fixed betting
terms for each of the contestants;
means for displaying the certain fixed betting terms for each of the
contestants;
first means for inputting data representing a wager, made during the
contest, on one of the contestants;
second means for measuring an imbalance of the one of said betting pools
for which the wager is made;
third means for determining on the basis of predetermined criteria whether
to change the certain fixed betting terms of the one of said betting pools
for which the wager is made;
fourth means, responsive to the third means, for changing the certain fixed
betting terms of the one of said betting pools for which the wager is made
in order to induce a betting pattern that will tend to result in balancing
the one of said betting pools for which the wager is made; and
fifth means for determining whether to suspend wagering on one or both of
the contestants. |
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Claims |
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Description |
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BACKGROUND OF THE INVENTION
Field of the Invention
This invention relates to a system and method that automates sports betting
and allows betting to continue while an event is in progress.
Sports Betting
Legalized gambling on sports events, commonly referred to as "sports
betting," is an organized activity in many parts of the world. The entity
that accepts the wager (the house) does not intend to enter into the
wager, but merely to serve as a broker, matching players (bettors or
gamblers) betting on the opposing contestants in an event such that the
funds that the house must pay out to the winners equals the amount gained
from the losers, less the commissions the house charges for brokering the
transactions. The system and method of the present invention is applicable
to betting on any event in which two contestants are competing to win. The
event need not be a sporting contest, but may be any type of contest, such
as an election, etc.
Establishing Betting Terms
It frequently happens in a contest that one contestant is more highly
regarded by players (is the "favorite") and therefore is likely to have a
greater sum wagered on its winning than is wagered on the other contestant
(the "underdog"). If the house were to allow that to happen without some
form of financial counterbalancing, then should the favorite win, the
funds gained from losses on the underdog would be insufficient to pay the
players who had bet upon the favorite. The house would in that case have
to pay some of the players backing the favorite with its own funds. Of
course, should the underdog win, the house would be left with a surplus
after taking its commissions and paying the winners. In either case, the
house would have an interest in the outcome of the contest and therefore
be involved in the wager, instead of being solely a broker.
The house seeks to induce equal wagering on each contestant by giving
either a handicap (the favorite must win by some margin) or odds (a
greater than equal payout on winning to the underdog or a lesser one to
the favorite) on the outcome of the event. For example, if a handicap of 5
points were given, the favorite would have to win by more than 5 points
for the players betting on the favorite to succeed with their bets. Should
the favorite win by fewer than 5 points (in this example), those who bet
on the favorite would lose. If the favorite wins by exactly the handicap
margin, house rules dictate the result. (It could result in the player
losing, the player winning, or the wager being voided.) For simplicity in
subsequent discussion herein, such bets will be considered as ties and
therefore void.
In the case of an odds payout, the favorite, upon winning, would receive
only a percentage of the amount paid if the underdog won. For example, if
the odds were two to three (2/3) on the favorite, a wager of $300 would
return winnings of $200. Correspondingly, if the odds on the underdog were
three to two (3/2), a winning wager would pay $300 for each $200 bet. It
is unnecessary, however, for the odds to be reciprocal (2/3 and 3/2 in the
previous example); there could be separate odds on each contestant should
that be necessary for the house to attempt to balance the pool or increase
their profit. In all cases, a house commission could be charged to the
players, either as a deduction from the winning payout or as a charge
up-front to all players (a betting fee).
Both a handicap and odds serve the function of seeking to equalize the
house's gains and losses, but by differing means. With a handicap, the
house seeks to make the likelihood of each contestant's winning, and
therefore the likelihood of players wagering on each contestant, equal.
With odds, the house takes the position that if the contestants were to
engage in a large number of contests, the odds reflect the percentage of
the time that each contestant would win. For example, with 2 to 1 odds,
the house estimates that if the two contestants were to compete many
times, the favorite would win twice as often. This means that on a random
basis the favorite is twice as likely to win any given contest. Thus,
should the house be accurate in establishing the proper odds or handicap,
and presuming that the players act rationally, the total sums wagered on
each contestant will be just sufficient to pay the winners, without the
house having any sum at risk regardless of the outcome of the sports
event. This equalization is referred to as "balancing the book."
The culture of sports betting is such that the player wants to know the
odds or handicap (point spread) of the wager at the time it is placed
(fixed terms betting). While these may subsequently change as the house
attempts to balance its book, the terms for a previously placed bet remain
the same. Thus, different players who placed bets on one contestant over a
period of time could have different betting terms (odds or point spread).
This is different than the situation in race track betting where a
parimutuel system is used, where all wagers on the same contestant have
the same terms, and the player does not know the odds he will receive when
he makes his wager, but learns the odds only after all wagers have been
placed.
Whether odds or a handicap is used depends upon the type of sporting event
under consideration. It usually devolves from tradition and is based upon
experience with results in that sport. For example, in basketball, a given
stronger team might be expected to win 70% of the time over a given weaker
team, but the average margin of victory might be expected to be only 5 or
6 points. In that case, a relatively small handicap could serve to
equalize the contest, whereas the odds would be quite large (over 2 to 1
in this case). A similar situation exists in football. In baseball,
however, scores are much more variable but the underdog is usually not
much less likely to win than the favorite. In that case, a relatively
small difference in odds, say 7 to 5, and almost always less than 2 to 1,
will equalize the contest. In addition, in sports such as boxing, there is
no convenient handicap and so odds are used. Most sports have a
traditional means of balancing the book.
Sometimes the house's initial handicap or odds will not lead to a balanced
book because the players do not agree with the house's assessment. In the
case of odds, the house will attempt odds equalization, in which the house
changes the odds to bring the book into balance. This is usually possible,
but in extreme cases the house must resort to refusing to accept wagers on
one of the contestants and hope that the bets on the other one will
eventually balance the book. The house can also make countervailing wagers
with other houses (lay off bets) to balance its book. Laying off bets is
the sports betting equivalent of reinsurance in the insurance industry.
It is more difficult to balance a book in the case of a point spread
(handicap). The point spread can be changed, e.g., a 5 point handicap can
become 6 points, 7 points, etc. But if the book is not in balance at a
given point spread, balancing it by adding other point spreads such that
the dollar total of all bets on one contestant over all point spreads
equals the dollar total of all bets on the other contestant over all point
spreads will not assure that the house has no exposure for every possible
outcome of the event. To avoid having the house be at risk, the house can:
(1) accept bets only on one contestant if the book is out of balance; (2)
combine odds with the point spread; (3) have a different point spread for
each contestant (e.g., Team A receives a handicap of 5 points but Team B
must win by 8 points for players betting on B to be paid off, in which
case the house pays out nothing if the team's scores differ by 6 or 7
points), so the house's increased profit potential over many events will
compensate for any risk the house has with the unbalanced book; or (4) lay
off bets. In any case, the house tries to take corrective action before
the book gets substantially out of balance.
Increasing Sports Betting Profitability
The mechanics of sports betting, described above, do not address a
principal drawback to the profitability of sports betting in a casino
environment. The drawback arises because most sporting events upon which
bets are made take several hours to complete. Because the bets are not
decided until the contest is completed, the rate of return (or commission
per hour) is quite low and, particularly in a casino where facilities are
being utilized, sports betting has a relatively low profit margin.
Another deficiency of present sports betting as relates to operation in an
organized environment is that the range of the types of bets which are
available is restricted. The basic bets each involve selecting the winner
with a given handicap. Occasionally there are other bets offered, such as
total points scored, etc. However, gambling establishments generally
prefer a much broader range of betting opportunities. For example, in
horse racing, wagering can include: (1) bets on one horse finishing first,
second, or third; (2) bets on two, three, or four horses finishing first
and second, first, second, and third, or first, second, third, and fourth;
(3) bets on the results of several races (parlays); etc.
The way to increase the profit margin in any brokerage business is to
increase the number of transactions which produce commissions. The way
this is done in horse racing (a specialized form of sports betting in
which there are usually many contestants in each event) is to have
multiple, sequential events (races). The winnings from each successful
wager are available for subsequent wagers, which will again return
commissions to the house. In addition, the many races and many bet types
(win, place, show, exacta, parley, etc.) provide many opportunities to
bet.
The rapid availability of winnings for subsequent bets is called
"churning." It makes it possible for $1 or 2 million to be bet at a
racetrack when the players who come to the racetrack have only about
$500,000 initially available for wagering. This can be done because races
are run at approximately 1/2 hour intervals and there are usually about 10
races per day, giving many opportunities for churning.
In other forms of sports betting, while there are numerous events to place
bets upon, taking into account games in different time zones, there is
usually no more than one chance per day to churn winnings.
A data processing system that addressed these deficiencies would be
particularly useful.
SUMMARY OF THE INVENTION
The present invention provides a system and method that maintains a betting
pool having certain betting terms. This system and method controls the
terms (the betting odds and/or handicaps) for the contestants such that
bettors are encouraged to place bets that will bring the betting pool (the
"book") into balance. In this way, the entity which is accepting the bets
minimizes its financial exposure from one or more betting pools being out
of balance, and the pool balance(s) are maintained within a maximum
percentage of the value of the pool(s) or below a maximum dollar amount.
Such a system and method allows bets to be entered on multiple terminals,
events to be displayed in conjunction with the acceptance of wagers, and
the provision of a broad variety of bet types on an event. Use of the
invention also enables a bet to have a present value and allows bets to be
cashed prior to the completion of the event for their then fair market
value. The invention can also be used to automate betting on any other
event, such as the results of an election, in which two contestants are
vying to win.
In particular, the system of the invention comprises a central processor
means for processing data; a storage means for storing data; first means
for calculating an imbalance of the betting pool; second means, responsive
to the first means, for determining on the basis of predetermined criteria
whether to change certain betting terms; and third means, responsive to
the second means, for changing the betting terms.
The present invention overcomes most of the deficiencies that prevent
sports betting from being a more profitable undertaking. A system and
method according to the invention will (1) balance a sports betting book
automatically to ensure staying within virtually any level of equality
desired; (2) greatly extend the period over which betting is permitted;
(3) encourage increased wagering by making a far larger range of possible
wagers available; (4) increase the speed and efficiency of wagering so
that operating costs are reduced; (5) permit betting on a range of point
spreads so that it will no longer be as essential in balancing the book
that the initial point spread set by the house reflects the views of the
players as to the relative merits of the contestants; and (6) it will
permit churning of winnings by allowing cashing of bets during the
contest. Other objects and advantages of the present invention will be
apparent to those of skill in this art.
BRIEF DESCRIPTION OF THE DRAWINGS
FIG. 1 is a schematic system diagram of a system according to the present
invention.
FIG. 2 is schematic flow diagram of pool processing in a preferred
embodiment according to the present invention.
FIG. 3 is a generalized logic design diagram of pool processing according
to the present invention.
FIGS. 4a and 4b are flowcharts of pool processing in a preferred embodiment
according to the present invention.
DESCRIPTION OF THE PREFERRED EMBODIMENTS
With sports betting as it is currently administered, the house selects
terms which it believes will balance its book and then--until the start of
the event--occasionally changes the terms if the book gets much out of
balance. No bets are allowed after the event starts because it seems that
if bets were allowed after the start of an event, the late bettors would
have additional information on the probable outcome from the results of
the already completed part of the contest. For example, scores could have
been made, players could have been disqualified or injured, one team might
appear to be playing on a lower level than usual on that day, etc.
But any advantage that seems to be gained by wagering after the start of a
contest does not in reality exist if the book is constantly being
balanced. In a system and method for sports betting according to the
present invention, the terms for a wager are actually an offered price on
the wager at a given time. The price offered is subject to alteration as
conditions in the event and the perceptions of the players change. By
placing a bet the player has "purchased" the wager at the offered price.
When the book is in balance, players on opposite sides of the proposition
have, in effect, made bets with each other, with the house brokering the
transaction. When the book is out of balance, the house in effect becomes
a player on the underfunded side of the transaction, having to place at
risk the sum needed to balance the book.
An analogy can be made to the stock market. Trades on the stock market are
made when bid and offered quotations are in agreement, the trade taking
place at the price to which the parties agreed. 0n those occasions when it
may not be possible temporarily to find traders on one side of the
transaction, the market maker in the stock must buy or sell from his own
account to accommodate unsatisfied trades and maintain an orderly market
while prices are adjusting to reflect market sentiment. The market maker
is at risk for the trades he himself must make. He can also benefit from a
"spread" (difference) in buy and sell prices, which is analogous to having
a spread in odds or handicap in sports betting.
In both the stock market and sports betting, offered prices respond to the
sentiment of the players. It is as valid to allow wagering during a sports
event as it is to trade stock while a business proceeds in its normal
course and results are being announced as to performance. Following this
logic, it is unnecessary to stop sports betting at the start of the event.
The betting can continue during the contest almost until the end, with the
odds varying to reflect the players' perceptions of the changing fortunes
of the opposing contestants and the book continuing to be brought into
balance.
Thus, by allowing betting after the start of a contest, not only is the
wagering period greatly extended, but the changing fortunes of the teams
will serve to expand betting opportunities. In practice, a single player
might have many wagers in the same pool at different odds and even on
different contestants. He might even have multiple wagers in different
pools on the same game, made as the fortunes of the contestants changed.
The present invention provides a data processing system and method for
maintaining a betting pool having certain betting terms. The system and
method according to the present invention is preferably implemented using
computer hardware and software. In a preferred configuration, an apparatus
according to the invention connects to a network of input and output
devices and displays. FIG. 1 is a schematic diagram of a typical system
configuration according to this invention. The system comprises multiple
elements, including a central processing unit 300 that maintains all
pools, calculates odds, opens and closes all wagering on all pools,
controls all input and output devices, produces all management and
analysis reports and is the repository for all current and historical data
on the wagering system. Central processing unit 300 may include one or
more processors, storages, control units and communication devices. It
interconnects to input and output devices such as remote betting terminals
302, optical character recognition (OCR); input betting stations 308,
management output printers 310, management input/output terminals 312,
betting system archival storage systems 314 (which typically are tape or
laserdisc storage systems), betting system data storage systems 316 (which
typically are disk storage systems), overhead betting odds display systems
318, and television (TV) distribution system 320, which provides output to
television screens 322 and large screen projection television displays
324. The wagers are entered into the system both by players themselves at
user terminals 302 and by tellers at managed betting stations 304 (using
personal computer terminals, not shown), who may issue receipts via
betting receipt printers 306. Each user terminal 302 preferably comprises
a personal computer running a "windowing" system, with each contest upon
which a user can bet displayed in a separate window along with information
regarding betting terms for the bets the user has made, the user's account
balance with the house, etc. User terminals 302 may also have associated
printers (not shown).
User terminals 302 and PC terminals used at manned betting stat | | |
