Securing the secrets of sports data

The sport data market has grown fast over the past decade to become a multi-billion dollar industry where companies pay a substantial premium for mere seconds of an advantage over competitors.

Two of the biggest names in sports betting data, Genius Sports and Sportradar are currently locked in a high-profile lawsuit to determine whether this live data can be monopolised, and neither wants to back down.

“A core point of contention in situations like this is whether the information being viewed at these events is confidential,” explains Ian De Freitas, partner at Farrer and data dispute specialist.

An industry body called Football DataCo (FDC) was formed in 2001 to decide just who got the privilege of pitchside data collecting. It handles all data for the Premier League, English Football League and Scottish Professional Football League, opening tenders to find out who will strike the best offer for its premium data.

In 2019, Genius won those rights, paying a premium for what can amount to mere seconds of competitive advantage.

Genius—which is about to float on the New York Stock Exchange with an estimated valuation of $1.1 billion—is keeping this exclusive data close to its chest, offering other sport data companies licensing deals but not allowing them pitchside. But it is claiming that Sportradar has been “unlawfully”’ sending its own data scouts to matches and launched a lawsuit against Sportradar in early February.

Tom Russell, general counsel of Genius Sports Group, says the company was “disappointed, but unsurprised” that the pair have ended up in court.

“Sportradar has a long history of using clandestine tactics to enter venues and collect data without consent,” claims Russell.

“Given Sportradar’s cynical promotion of itself as a partner to the global sports community, we are continuously astounded at its willingness to exploit sporting events while undermining the vital funding of sport.”

Sportradar, however, openly criticises the FDC’s agreement with Genius. On February 28, it registered a claim seeking an injunction and damages from Genius Sports, BetGenius (Genius’ subsidiary) and the FDC with the UK’s Competition Appeal Tribunal (CAT).

“At issue in these proceedings is, among other things, the lawfulness of the long-term exclusive agreement between FDC and Genius which forecloses the market to Sportradar and others and prevents a healthy and competitive market that benefits data customers and fans,” says a Sportradar spokesperson.

“Sportradar’s position is that there is no justification for such an approach other than to try to secure monopoly rents: integrity suffers, innovation suffers, and the consumer suffers.”

The CAT filing claims that the system currently in place between BetGenius and the FDC is in breach of UK and EU competition law. Sportradar also confirmed that the High Court action launched by Genius and the FDC will rely on the outcome of Sportsradar’s competition claim.

Russell says: “Sports data is a sophisticated business, and Genius Sports pays significant fees to partner with sport for the right to collect the official data it sells. Genius Sports cannot allow Sportradar to continue to deliberately undermine our sports partnerships by using covert tactics to collect unofficial data from inside stadia that Sportradar sells to betting companies, without any payment to sport.”

The TRP v SIS precedent

While Genius v Sportradar is the most recent sports data case, eyes are also on TRP v SIS, which could prove a sign of things to come.

In 2019, UK betting shop The Racing Partnership (TRP) filed a claim to protect the exclusivity of its live data on horse racing results against five competitors, including Sports Information Services (SIS). TRP was established as a partnership between several key racecourses in order to aggregate raceday data and sell it and live coverage to bookmakers—very similar to the role played by FDC.

The defendant, SIS, was accused of unlawfully collecting and distributing live data and coverage of raceday events separately from the TRP system.

In the first case, the English High Court ruled in May 2019 that SIS had not infringed on any copyright or database rights. However, Justice Zacaroli found SIS guilty of breach of confidence—an argument that states that if information is given that is expected to remain private and that information is made public, an injunction and damages can be obtained.

The judgment moved to the Court of Appeal. In October 2020, the High Court decision was overruled with a 2–1 majority. The arguments that overturned the rule mainly centred around an argument that “key raceday triggers” were broadcast almost simultaneously, therefore SIS was not expected to have known that the information was confidential.

The case is likely to head to the Supreme Court for a final verdict—one that could have massive implications for how sports and betting data is distributed.

“The Court of Appeals decision was fairly contentious,” says De Freitas. “If the information is deemed to be confidential, it is confidential for only a short period of time. But crucially, that is where the value of the data lies. Those few seconds are incredibly valuable in the betting world.”

Financial parallels

If this all sounds familiar, it's because a very similar story was developing over a decade ago with the digitisation of the stock market.

“When I first joined the practice, a lot of similar problems were arising in the financial markets,” says De Freitas.

“There were cases where people were stealing information from some of the businesses that were supplying the information to the market and using them to trade very quickly in ways that were unlawful. The data was being used to bet on companies rather than sports teams.”

The Genius Sports and the TRP cases will both likely determine the future for how data is monetised in sports betting going forward. The case will probably not prompt new legislation to regulate the market—but it might not be too far away, says De Freitas.

“Should a government be getting involved and regulating? That is the crucial question. Are companies exploiting information in a viable way or are they limiting free speech?” he asks.

“I don't think there will be litigation from the current UK government to address this, but as the market grows, it could be coming.”

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