Illustration by Lorenzo Gordon. Photo: Getty
In late 2022, shortly after signing the largest media deal in college sports history, Big Ten executives began focusing on another major commercial milestone—the first gambling data deal among the five biggest conferences.
Led by then-commissioner Kevin Warren, the Big Ten entered advanced talks with Genius Sports on a 12-year deal that would pay the conference at least $240 million in guarantees, plus a revenue share on top, according to multiple people familiar with the negotiations.
A non-binding term sheet was signed by both the Big Ten and Genius Sports, the people said, but the deal was never executed. Warren, who left the conference for the NFL’s Chicago Bears in January, did not want to make such a big commitment on his way out the door, and the incoming regime has so far declined to pick up where he left off. Twelve months later, the conference suggests it’s a low priority.
“This is about getting it right … protecting the integrity of what we’re doing, and making sure that we put the kids, coaches and everybody else in position not to make mistakes,” current Big Ten commissioner Tony Petitti said in an interview. “If it’s an opportunity today, it’ll be an opportunity tomorrow.”
Other leagues are operating under a different expectation. A few small conferences already have gambling data deals, and the Big 12, sources say, could finalize something in the coming weeks. But the history of the last few years suggests that the financial opportunity—whether today or tomorrow—has steadily diminished. Current price tags pale in comparison to the $50 million-a-year numbers that were once bandied about, according to sources, and have maybe even come down further than the $20 million-a-year number in the Big Ten/Genius term sheet.
Representatives for Genius, the Big Ten and the Big 12 declined to comment about their specific negotiations.
For now, the data companies have been collecting the information for free by dispatching “data scouts” who buy tickets to college football and basketball games across the county and build their own data feeds through phone calls and custom mobile software. These operations, which generally draw scrutiny only once official deals are struck, cover virtually all FBS football games, a chunk of FCS football games, and a majority of Division I basketball games, according to those familiar with the business. This unauthorized system currently powers most legal in-game college odds across the U.S., at little expense to the data companies or sportsbooks.
Recent negative headlines have impacted the willingness of college administrations to further align with sports betting. The American Gaming Association in March updated its “Responsible Marketing Code” to advise sportsbooks against college partnerships, a move that led to the termination of the few commercial partnerships between operators and Power Five schools. The past year has been littered with college betting scandals, including the dismissal of an SEC baseball coach and criminal charges against a number of Iowa and Iowa State football players.
But perhaps the bigger issue, according to those on the front lines, is that in the years since the negotiations commenced, the economics of the industry have shifted. The “official” data from sports leagues—which can include everything from basic play-by-play stats to novelty metrics like pitch speed—is increasingly difficult to monetize. The AGA’s new guidelines devalued the college data by discouraging participation from sportsbooks like FanDuel and DraftKings, and exclusivity enforcement in these deals is hard for even the richest pro leagues, let alone college conferences with much smaller staffs.
“The market has just changed,” said Matt Holt, CEO of U.S. Integrity, which has advised conferences and schools about their commercial gambling endeavors. Asked about the most common question he gets, Holt said, “It’s the cost differential between now and two years ago. They say, ‘Why were the offers on the table two years ago so much greater than now, when TV numbers are up, viewership is up, engagement is up, and betting is up? How can these numbers go down so significantly?’”
Big Pro Deals
Companies like Genius (NYSE: GENI), Sportradar (Nasdaq: SRAD) and Endeavor-owned IMG Arena pay up front for the exclusive right to take official data, productize it and then sell it along to media companies and sportsbooks. Many of the stats fans see on a TV broadcast, or the movement of live odds during the game, trace their origins back to these data feeds. Those companies currently sell their official data feeds in competition with non-league partners, who build their feeds off data scouts or low-latency video.
As more and more U.S. states legalized sports betting in 2019 and 2020, data companies were quick to push for exclusivity in deals that reflected the perceived value of those rights in the newly opened U.S. market. In April 2021, the NFL and Genius Sports signed a four-year agreement worth hundreds of millions in cash and equity. A few months later, Sportradar and the NBA inked an eight-year deal worth more than $1 billion in cash and equity. That same year, Sportradar finalized a 10-year deal with the NHL.
At the time, the pro leagues and data companies were lobbying state legislators to include provisions in their sports betting laws that mandated the purchase of official data, but those efforts were largely unsuccessful. One of the few states to acquiesce, Tennessee, recently repealed its official data mandate. The lack of a decree for official data feeds created a vibrant market for unofficial ones, which cost a lot less to put together and—many in the industry believe—are commensurate in quality.
MAC Scout Expulsion
In May 2022, the Mid-American Conference became the first college league to partner with a betting data company when it signed a five-year deal with Genius Sports that covered stats, data and other sponsorship assets. The MAC and Genius have since worked to educate members on how to root out unwanted data scouts from their football and basketball games, and to push back against companies that openly advertise to hire those scouts. Data scouting is a legal grey area, but it’s often a violation of the fine print on the back of the ticket.
The efforts have been effective, according to multiple people inside the industry, who say MAC schools have removed significantly more scouts from basketball and football games since the Genius deal was announced.
“I’d like to think we’ve been fairly effective at that,” MAC commissioner Jon Steinbrecher said in an interview. He declined to provide details about the numbers or the specific strategies for finding and removing people he criticizes for “pirating our data.”
That said, the efforts haven’t fully snuffed out the gray market. And while the MAC doesn’t have the resources of its bigger peers, experts note it does have one notable enforcement advantage: It’s much easier to identify a data scout at a football game with 14,470 fans, the MAC’s average last year, than it is in a stadium with 76,500, the SEC’s 2022 average.
NCAA Clarification
As it was negotiating its Genius deal, the MAC filed a formal “interpretation request” with the NCAA to ensure that it did not run afoul of association rules that prohibit athletes, school administrators, conference employees and university leaders from “provid(ing) information” to anyone associated with sports wagering. In response to the MAC’s query, the NCAA’s Division I Interpretations Committee later clarified that school and conferences could provide stats to sportsbooks “if that information is also available to the general public.”
The NCAA’s clarification was important for athletic directors and conference commissioners, who were also unclear about who exactly owned the rights to cut these deals in the first place. The operating assumption, sources say, is that the NCAA owns the rights to the statistical data produced from its championships, like March Madness or the Frozen Four, but that the schools own the rights to their home contests. The MAC/Genius deal adheres to that understanding: The league’s 12 schools collectivized their rights to cover all conference games, conference championships and all home nonconference contests.
Betting Scandals
At the time, the expectation was that the MAC deal and the clarification from the NCAA would open the floodgates for future conferences. That didn’t happen. It would take more than a year before another FBS league, Conference USA, announced a similar partnership with IMG Arena.
In the interim, scandals surrounding the Alabama baseball program and the Iowa and Iowa State football teams heightened public scrutiny of college sports and gambling. There was also the AGA’s decision to update its responsible gaming code following a New York Times series that detailed sportsbook advertising on college campuses. The AGA changed its industry standards by “prohibiting college partnerships that promote, market or advertise sports wagering activity.”
Sportsbooks appear wary to challenge that new norm. The AGA shift led to the termination of several advertising deals between colleges and sportsbooks, such as Caesars’ partnership with LSU and PointsBet’s with Maryland.
The AGA ruling also had an immediate negative impact on the value of college data rights, according to people who have sat in negotiations. Marketing assets and team IP are often significant parts of the pro data deals, but if sportsbooks are afraid of any advertisements involving colleges and college campuses, the thinking is, there’s less value for data companies sitting in the middle of universities and operators. That’s pushed negotiations more toward strategic partnership-style deals, and away from contracts with big cash components, the people said.
On Wednesday, the NCAA announced it would lobby state legislators to update any existing and future gambling laws. The organization wants to prioritize protections for athletes and integrity monitoring but also says “revenue generated from sports betting should be allocated in part toward education to support the higher-risk college student population.” It’s unclear whether that might also impact data talks.
Middle Ground
For now, college sports are caught somewhere between monetizing betting and shunning it. And the result is a data market of only unofficial feeds.
But what happens if the industry gets more fragmented? In a world where the Big Ten, SEC, ACC and Big 12 all have official betting data partners, perhaps with four separate companies, would sportsbooks then be willing to purchase four different feeds? And how can the conferences guarantee that the cheaper unofficial feeds aren’t effectively the same as their official ones? We may soon find out.
“There will be some type of deals done,” Holt said. “But even if you’re a Power Five conference and you wanted to sign an exclusive deal, and one of these vendors came to you and said, ‘Here’s $50 million if you can guarantee exclusivity,’ how would you do it? It’s impossible. And the vendors know that.”
