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Shifting sands in the US data debate

Insight | Analysis

It seems somehow appropriate that the London Stadium, home to English Premier League club West Ham United and the erstwhile 2012 Olympic Stadium, was remodeled in late June into a baseball ground.

To provide the setting for Europe’s first-ever Major League Baseball (MLB) series between the Boston Red Sox and the New York Yankees, the pitch was transformed into a baseball diamond with clay imported for the pitcher’s mound and fence padding shipped in from Montreal.

In the year or more since the repeal of PASPA the positioning of the major sports leagues with regard to how their data is distributed in the US has come to dominate the discussions taking place in the many states now debating the regulation of sports betting.

So much so that many of the arguments given an airing in the US, such as the two-game Red Sox-Yankees series, have now migrated back over the Atlantic and into Europe. The further advance of sports betting in the US, then, is having reverberations throughout the betting and gaming ecosystem.

First, though, we should stress the clear differences between how the practice of data distribution has evolved in Europe compared to a varied selection of developing scenarios in the US.

The first and most stark comparison comes with the idea of mandated data. As part of the legislation first in Tennessee and subsequently in Illinois the bills include language about operators being forced by law to take only official sports data for in-play betting purposes.

It is an important development for the leagues. Mandated official data is among the ‘five pillars’ that a coalition of Major League Baseball, the National Basketball Association (NBA) and the Professional Golf Association (PGA) have been lobbying for in any sports betting legislation alongside calls for the inclusion of mobile betting, input into allowing risky bet types, real-time betting data sharing and an integrity fee.

The last of these might not be gaining any traction but Dan Spillane, senior vice president and assistant general counsel for the NBA, said the leagues were “happy” with the mandated data wins in Tennessee and Illinois as it means they can point to what has been done there when it comes to other states. “It’s helpful to have a precedent when talking to legislators,” he adds.

Indeed, what can be overlooked from a European perspective is the degree to which the legislated relationship between US sports and betting in some US states is still a “blank canvas” or “at least an unfinished picture,” as described by Tom Edmonds, an associate at sports law specialist Northridge in London. Edmonds noted the difference between “European countries that have established gambling legislation” and “US states that are introducing legislation to permit sports betting for the first time, where there may be an opportunity to include a requirement to use ‘official’ data as part of a broader legislative package that legalizes sports betting”.



Yet the very fact of mandated data is almost certainly not the end of the matter. In both states the regulators have the ability to waive the mandated data requirement if operators are able to demonstrate that the leagues are not offering the official data feed on commercially reasonable terms.

In Tennessee, at least, what is commercially reasonable is open to interpretation but according to Ryan Rodenberg, an associate professor at Florida State University, such legislative tinkering is unlikely to avoid legal actions.

“Litigation will likely arise in the US in the wake of any state that enacts and enforces a mandate pertaining to sports betting news and information,” says Rodenberg. “First Amendment claims and antitrust lawsuits are among the most likely to arise.”

It means that any mandate may not survive a legal challenge but it doesn’t mean the relationship between sports leagues, suppliers and operators will necessarily be antagonistic.

“We are going through a process with the NBA and MLB, in particular, of starting to understand the market dynamics,” says David Lampitt, managing director of sports partnerships at Sportradar.

“Since PASPA fell, the sports have wanted to identify the best model; what is the best way to do this, to structure their approach to the market. They have done things differently in the US and one of the innovations is that they are bundling up commercial benefits with taking the official data route.”

Similar sentiments come from Jack Davison at Genius Group. “The official data argument is now defined by debates over whether there is a true value exchange between sports and operators,” he says. “To sustainably quantify this value exchange, history shows us that a reasonable commercial model is the most viable solution.”

Deals reached so far between providers, operators, and the NBA, NHL and MLB show this commercial model in action. The MGM/GVC deals with all three of the sports mentioned see the operator become an ‘official gambling partner’, allowing it to use logo and trademarks and opens up the potential for sponsoring individual teams.

Similarly, William Hill has signed a deal to become the official betting partner of the NHL which will see it receive promotional media in relevant NHL markets and other branding opportunities. William Hill is also the betting partner of the Las Vegas Knights which features inarena branding.

Importantly, when it comes to distribution of the data both the NBA and MLB have opted for non-exclusive arrangements. “It’s an interesting development,” says Lampitt. “It means they will be able to exploit the maximum breadth of downstream opportunities and has the benefit of promoting competition within the market.”



The arrangements already in place go some way to proving the arguments from, among others, the American Gaming Association (AGA) that the advent of expanded sports betting in the US will bring commercial benefits that more than match any benefit from an integrity or royalty fee.

The sports still hold out hopes that they can persuade states to adopt the royalty route and Spillane talks about only needing one to provide “proof of concept” for the idea to be discussed more widely. But Lampitt suggests direct commercial arrangements might be more persuasive.

“If you take the official route, you get the benefits: advertising opportunities, sponsorship of teams. If you are not involved as an official data partner, you don’t get those benefits,” he says.

“That is an interesting development in this inter-relationship between sports and sportsbooks. Various sports have tried to enforce the ownership of data through legal means and these efforts have almost universally failed, but in applying commercial terms the sports are now providing an incentive to go into that commercial set-up. In our view this is a more attractive approach than mandatory usage, which potentially stifles choice and competition in.”

What will become clearer in the years to come is that the cost of data is likely a one-way ratchet. “Some sports betting operators might agree to the broader package in relation to a US state as there is the net benefit of being able to access a new market, albeit having to use more expensive official data,” says Edmonds.

In Europe, debates around mandates and royalty fees have less resonance due to an established EU database right but the arguments around the use of official data are just as pertinent.

“Some of the league’s current policy positions, such as the recognition of the value of official data, have been heavily influenced by other international leagues,” says Davison.

Lampitt brings up the issue of integrity. “How can the sports create a greater incentive to bookmakers to use the official set-up?” he asks. “There are good reasons to have an official set-up so that on integrity for example, information-sharing can be applied in situations that otherwise might not be possible.”

Edmonds agrees and suggests that there are “clear benefits” to incentivizing official data to be used. “For example, most of the parties that can collect official data will also provide a complementary integrity service to such sports bodies, which flags if there are suspicious betting patterns indicating match fixing,” he says.

“In addition, with regards to the integrity of sports betting, if there is official data, the sports betting operator and consumer should have more confidence that the data is correct and any related bets are correctly settled.”

The arguments are set to continue and will continue to evolve as more states move to legislate and regulate sports betting. As with that process, it is one that is unlikely to be foreshortened.

SCOTT LONGLEY has been a journalist since the early 2000s, covering personal finance, sport and gambling. He has worked for a number of publications, including Investment Week, Bloomberg Money, Football First, eGaming Review and Gambling Compliance. Scott now runs his own editorial consultancy, Clear Concise Media, and writes for a number of online and print titles.