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FRAMINGHAM (06/26/2000) - So what possessed this trio to set up shop outside London instead of inside Silicon Valley? The answer is this country's hypocritical, nonsensical - one might even say schizophrenic - laws governing gambling.

You see, Flutter.com Ltd. - a clearinghouse for folks who want to bet with each other on just about anything - would be illegal here, despite the fact you can't toss a pair of dice these days without hitting a government-sanctioned lottery outlet, Keno parlor or casino.

"There's a much different betting culture in England," Peters says.

Translation: The Brits are willing to admit what priggish Americans won't - that the instinct to wager can no more be bottled up by man's law than can the appetite for alcohol.

Here's how Flutter.com works: The site lets participants post their own wagers and odds, as well as accept the wagers and odds presented by others.

Flutter.com acts as "a trusted stakeholder in the arrangement," Peters says, in that it holds the money (US$150 max per bet) and settles all accounts once an outcome has been decided.

And here's the beauty of the business model, which is backed by $35 million in venture capital: The street-corner bookie typically charges a 10 percent fee - known as vigorish - which means that a gambler must actually risk $110 to win $100. Flutter.com takes only 2.5 percent off the top on its site and also manages to sidestep England's 6.75 percent betting tax. (I guess the British pols also pander to the dot-coms.)In the long term, you can bet that all attempts to stop Internet gambling will prove futile.

In the short term, it's a shame we're driving smart entrepreneurs overseas.

"We have what we call the 1:8:20 rule here in awarding funding," said Rob Adams, founder and managing director of venture capital firm AV Labs. "If one person in Austin has the idea, eight people on the East Coast will have the same idea and at least 20 on the West Coast will."

He's right. But who do you believe might be more put off by his bluntness? The entrepreneurs in Austin? Or those on the East Coast?

"So what to make of this ranting gasbag named Metcalfe? . . . You may not like the way he phrases it, but he's actually got some very important things to say, and he isn't afraid to say them."

Published by our corporate cousins at IDG Books, Mr. Gasbag's "Internet Collapses and Other InfoWorld Punditry" is the type of book every columnist longs to produce because you get paid a second time for work that wasn't digging ditches the first time around.

You can tell the good compilations from the riffraff by riffling to any random column. My finger landed on page 280, where Metcalfe had this to say about Linux:

"Why do I think Linux won't kill Windows? Two reasons. The Open Source Movement's ideology is utopian balderdash. And Linux is 30-year-old technology."

Now that's a haymaker.

McNamara will never get his own "best-of" book if you don't help, so send tips and gossip to buzz@nww.com.

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