Friday, January 27, 2017

Data Analytics Makes LeBron's Free Throws Riveting

Data has become increasingly important in the professional sports world. Teams in the National Basketball Association (NBA), in particular, use data to determine the optimal times to rest certain players on their team. A Swiss sport data company with deep-pocket investors, like Mark Cuban and Michael Jordan, has virtually cornered the market on data analytics among the major American sports leagues. Sportradar AG has inked deals with the NFL, NHL, and most recently six-year, $250 million contract with the NBA. While the infusion of data analytics has revolutionized sports themselves, the work of Sportradar and competitors like Stats INC. and partners Second Spectrum may spur sweeping changes in sports betting industry, perhaps even leading some states to legalize the practice.
             Before the advent of data analytics as we know it, sport betting typically consisted of wagers on the outcomes of games and general numbers like the over/under on total number of points scored. Now, with data provided reliably and instantaneously at such a granular level, gamblers have the opportunity to wager on the likelihood that a basketball player like LeBron James will make a shot from the free throw line. Data analytics has spawned entirely new segments of the sport betting industry, including daily fantasy sports companies like FanDuel and DraftKings. The ripple effect of the availability of reliable data that can be shared so rapidly across so many different platforms has made lawmakers in state capitals throughout the country take notice. Recently, New York State became the latest to legalize and regulate daily fantasy sports. Without companies like Sportradar to ensure that data could be so transparent and accurate, it is difficult to imagine how states like New York could ever be convinced to accept practices that they have long fought to keep out.
            Indeed, Sportradar has begun to play a vital role in helping other leagues around the world safeguard against illegal activities among gamblers. The South American Football Confederation just this month partnered with Sportradar to stop a practice known as “match-fixing.” By helping identify and avoid manipulation of sporting events worldwide, data analytics companies play a vital role in the international justice system. Courts in the Western world and even policing agencies like the FBI have increasingly focused on the illegal operations of gambling and other forms of manipulation in professional sports. If data analytics companies can spare these agencies and other governments the time, energy, and recourses that they currently devote to ensuring fair play among professional athletic associations, then they will more than earn their slice of the profits they stand to reap in the coming years. Certainly, there are limits to the capacity of data analytics to remedy all that ails professional sport world, but we have already witnessed a dramatic shift in the acceptance of legalized sports betting. Perhaps we should all thank Sportradar the next time the Cleveland Cavaliers are blowing out the New York Knicks: at least someone can find intrigue in guessing which player will drain the three-pointer.

Justin Friedlander

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