The Betfair Prof / Leighton Vaughan Williams / 02 June 2008 /

The Betfair Prof, Leighton Vaughan Williams, takes a look at what prediction markets have done in terms of reality TV show. Most recently it was the BBC's 'I'd do Anything' in which Jodie Prenger beat perceived favourite Jessie Buckley on Saturday night...

I guess the first big test of the power of the betting markets in predicting the outcome of reality TV contests was the classic 2002 'Pop Idol' showdown between Gareth Gates and Will Young. While both budding pop stars were belting out 'Evergreen' and 'Anything is Possible', the phone lines were jammed by millions of callers determined to launch their favourite on the path to fame and riches. By the time Gareth had presented his unique rendition of the Righteous Brothers' 'Unchained Melody' and Will his own slant on the Doors' 'Light My Fire', Betfair had the Righteous Brothers' fan the solid favourite to beat off his older rival. In the event, though, those backing the outsider of two cleaned up as the public lit the fire of the lad from Hungerford with a commanding 53.1% of the 8.7 million votes cast.

All good fun, as the impresarios would have been delighted whichever of the two the public had favoured.

Such ambivalence about the outcome of the mass vote was less evident on Saturday night, as producer Cameron Macintosh declared that 'Jessie is Nancy', a vote of support backed by Lord Lloyd Webber and the only member of the judging panel who had actually starred in a stage production of Oliver, Barry Humphries.

In fact, a simple glance at the markets in-running would have reassured these three that Irish songstress Jessie Buckley was the clear favourite once the choice had been whittled down to a straight battle with Blackpool cabaret singer, Jodie Prenger. Yet it was the English singer who had opened the evening as pre-show favourite.

In a mirror of the Bush v. Kerry Presidential race in 2004, the pre-poll favourite beat the in-running favourite by the width of Ohio. In the case of Bush-Kerry, it was the inaccurate leaked exit polls that caused the market mix-up. In the case of Jodie and Jessie, it was perhaps the fact that the Blackpool girl sang first (usually a big negative) or maybe it was because she was simply out-performed throughout the show. On the other hand, it might have been that those inhabiting the trading rooms of the world's biggest betting exchange were substituting their own judgements of who should have won for that of those who were bothered enough, in the wake of phone-in scandals and the ITV competition, to actually take the trouble to call.

Either way, it is those who learned from Bush-Kerry (and perhaps even Gates-Young) who would have been on the right side of the market last Saturday night.

That those who selected the winner are unlikely to have constituted a representative cross-section of those weighing up whether to buy West End tickets is neither here nor there for those who traded the markets. For those producing the show, on the other hand, the choice of the girl whom I think it unlikely Charles Dickens, or even the theatre-going public, would have chosen, constitutes a setback. For both, however, there are clear questions to be asked. One of these is obvious. Just how DO you solve a problem like Jodie?

Professor Leighton Vaughan Williams is the Director of the Political Forecasting Unit and Betting Research Unit of Nottingham Business School, Nottingham Trent University, and Editor of the Journal of Prediction Markets

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