NBA, MLB Foreshadow Hard Stance on Official Data in Nevada
Game 1 of the NBA Finals could be a watershed moment in the development of legal sports betting in the United States.
Because it may help determine what kind of bets are made, on which sports, and at what establishment. Unsurprisingly, it’s about money.
Most professional sports leagues advocated for a tax or fee from sportsbook operators for the use of their product even before Supreme Court action allowed states to legalize wagering in May of 2018. With no states having afforded such a fee in the year since the overturning of the Professional and Amateur Sports Protection Act, leagues have turned to securing official data deals with the industry as an alternative route to the same revenue stream.
And all the while, burnished by the explosive growth of the mobile sports betting industry in New Jersey, operators and league officials have espoused what they foresee as an inevitable taste for so-called “in-play” bets that require fast, accurate information.
The decision of the NBA, therefore, to inform Nevada sportsbooks of a change to their rights agreements in the days before its championship series seems akin to raising the heating bill on the first day of winter. The NBA claims subscribers and those using the feed while negotiating deals have long known of the expiration of a grace period. The league has data or gambling deals with several entities including Sportradar, MGM and FanDuel.
Major League Baseball, which also has a deal with MGM, has followed suit.
Leagues’ Data Squeeze Nevada Problem For Now
In the immediate aftermath, this is at least a Nevada issue. And the impact there figures to be decidedly less than in New Jersey, where DraftKings Head of Digital Sports Book Jamie Shea said at the ICE North America conference earlier this month that 90 percent of her customers in the state placed at least one in-play wager when betting on an NBA game.
There has been no confirmation of an approach to New Jersey operators. But the state most benefitting from mobile betting and the data required for it would seemingly be of great scrutiny.
“The harmful impact wouldn't be as significant [in Nevada] as it is in New Jersey because we don't have the same level of mobile and in-play reliance,” Jennifer Roberts, associate director of the International Center for Gaming Regulation at University of Nevada-Las Vegas told Gambling.com.
Roberts said data suggests that in-play wagering in Nevada could constitute as little as 3 percent or as high as only 30 percent in the state.
How the NBA, MLB Play Transpired
SportsHandle reported that Sportradar informed outlets already purchasing its NBA feed that new terms would be created for the Finals, and that MLB had demanded a 0.25 tax on wagers moving forward. Both the MLB and NBA feeds are delivered through the Betradar brand.
“What I’ve heard, and people are reluctant to go on record, is that the leagues are demanding that to get the official Betradar data feed, you now have to pay a quarter percent of handle,” Robert Walker, director of sports book operations for Nevada-based bookmaker USBookmaking, told SportsHandle. “I’ve heard that the leagues, which would be the NBA and MLB, want a fee for in-game wagering data, in addition to the existing fees.”
NBA senior vice president, head of fantasy and gaming Scott Kaufman-Ross said in a statement:
“The NBA’s sports betting partners recognize the value of official NBA data and work with us to protect the integrity of our games. We provided a season-long grace period for other betting operators to have access to official NBA data while we discussed partnership terms. While that period is ending – something distributors and operators have known since the start of the season – we remain committed to securing additional sports betting partnerships.”
Roberts told Gambling.com there are a myriad of potential outcomes, from spurring more licensing and commercial arrangements, as has been the case in the United Kingdom, to sending sportsbook to alternate sources for data to offer in-play bets. They could also stop offering them. But Roberts expects sportsbooks to find a workaround.
“You could use the data that's out there being televised or through public sources. Problem is, with in-play, it's so immediate that there would be a delay on setting up the next bets,” Roberts said. “It can happen if you're just limiting what is being wagered on it for in-play. You could just resolve the bet based upon confirmed data as it's made available to the public. You just might not have the quickness that is expected of in-play.
“It's too much from an audit perspective to try to capture the record-keeping to try to keep records of that for gambling, audit purposes.”
Leagues Invested in Data, Seek Return
Major League Baseball executive vice president of gaming and new business ventures Kenny Gersh espoused what he believes is the quality and value of the data MLB collects and what could be offered for gambling at the ICE North America.
Gersh said the granular information collected was intended for distribution to media to “tell a story,” but outlined in great detail how the structure and pace of baseball was inherently conducive to in-play betting, adding “I know our data feed's better” than unofficial alternatives.
“No one can match the infrastructure that we have in the ballpark to capture what's happening in real time,” Gersh said. “And I think that's incredibly useful and valuable to create new markets and really change the way sports betting in America works.
“I don't think anyone [on his ICE North America panel] thinks sports betting in America in five years is going to look the way it looks today because if it does, that personally is a disappointment to me. But I know that the people in the industry that I've talked to, they're investing money in products and resources to build more compelling experiences for fans. And that data is going to be at the heart of it. That makes these things possible.”
Is There An Alternative to In-Play?
Ed Miller, co-author of “The Logic of Sports Betting,” told Gambling.com he believes there is an alternative possible no matter if sportsbooks purchase leagues feeds. Miller and co-author Matthew Davidow are banking on that supposition. The partners are in the process of launching an in-play platform called DeckPrism Sports built off a model on which bettors would wager during commercial breaks rather than in the real-time so-called “European in-play" method.
“At the core, it revolves around fairness. The European-style in-play is at its core not a fair product, as the betting operator freerolls the customer (no matter how well-intentioned they are when trying to design and operate it) for 15 to 25 seconds,” Miller told Gambling.com. “I think Americans will identify this unfairness and bristle at it.
The first time you place a bet on a basketball team, watch your team hit a 3-pointer while your bet is on delay, and then having it rejected as a result will be a powerful experience [in my opinion], especially because it will be obvious that the bet would have been accepted if the shot had missed.
“I believe American bettors will instantly see how much fairer the timeout product is and that it will be a huge difference-maker.”
Miller told Gambling.com that he believes the speed of play in many American sports is not conducive to European-style in-play, which is dominated by soccer wagering.
“We think that American sports lend themselves better to a timeout-focused in-play product where robust lines are posted when games go to commercial. This doesn't require any betting delay on the sportsbook operator's end,” he said. “The commercials will act as a cue for bettors to open their betting apps and see what's available.
“The idea of needing a data feed (putting aside the concept of "official" for now which I think is more of a legal concept than a technical one) is that the sportsbook needs up-to-the-second information about game state to support an up-to-the-second in-play line to the extent that our vision of a timeout-focused product takes hold here, it also ameliorates the need for this up-to-the-second data, as it's fairly easy for a firm like ours or a potential competitor to keep track of game state as games go to commercial.”
This could lead to market preferences de-valuing official data. And that could be a quake to the industry, as leagues, and increasingly sportsbooks and platform providers, have synchronized their stance that official data is imperative.
The market will begin figuring it all out soon, with the Golden State Warriors’ and Toronto Raptors’ quest for a championship as the backdrop.
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