GMB – How difficult was for Sportradar to face the pandemic moment with the suspension of championships around the world? How did the company live this moment?
Ricardo Magri – We adapt. Making a series of necessary adaptations that took us out of our normal. One thing I saw happening with several industries, not just ours. Sportradar suddenly found itself without its main element that originated the manufacture of our products, which were games. When there was a general stop in sports - and worse, with an uglier forecast for the future, since at the beginning of the pandemic there was still a discussion about the Olympics- the Olympic Committee announced that we would not have the Olympics. So Sportradar prepared for a drastic scenario that maybe we would not have any sport until the end of the year. The painting on the canvas was very ugly for the future and we would be without the main element, which was the sport for us to manufacture the odd and provide for betting operators to be able to deliver this to their consuming public. Where did the adaptation go? Sportradar found itself in need of manufacturing events, something we had never done before. We have become a more active part in the organization of events. What events? What we could do. Sportradar managed to organize ‘table tennis’ tournaments with its own investment, for example. It was safe to do with two players, with appropriate distance and mask. Few people broadcasting, since one camera is enough to take the entire table and only one referee. Thus, Sportradar organized “table tennis” events in various locations around the world, including Brazil. A simple contact with a person from the sector, an explanation of the idea and a budget reserved for that and we organize a series of official ping pong games, with professional players, to offer to the betting market.
Another way to do this was with eSports, which had a huge boost in this pandemic phase because people could play from home. We organize football game tournaments, as it reaches an audience orphaned by official football, trying to organize events with professional players. We have seen many events happening in the play area, but it is difficult to bring a sports trader, a voracious gambler to bet on one celebrity against another. It is a game that is not serious for him, due to the difficulty of predicting who is stronger. When you talk about a tournament with professional players, he probably studied the trade in the past and knows that a player is top of the ranking or even consult a ranking and see that he will play the 20th against the tenth and measure the strength by his reasoning. And our odds creation audience has better elements to place an appropriate price for this bet. So, Sportradar actively organized several eSports tournaments not only in Brazil, but in Latin America as a whole and elsewhere in the world. We did it. We got a very good number of contents.
There is even a study by Sportradar that raised the number of sporting events in April compared to the same month last year. The effort is valid, but unfortunately it is not the same product quality. The betting site is not expected to have the same result with such a game compared to a Champions League or Libertadores game. They liked it, of course, because they had something to put on the air, but it is not the same thing. We knew that, but it was better than standing still and a way to make the industry more surviving. It took a gigantic effort, did not give the same result, but it was better than standing still and kept us active during the pandemic.
It was a tremendous challenge, but now the championships are coming back. Is that a light at the end of the tunnel for an activity like Sportradar?
No doubt. We can say - in everything I hear and in all aspects, including in the clubs and federations - that the return of the Bundesliga in particular was the border between chaos and the walk out of that wake that was trying to drown everyone. We started to get out of this more turbulent tide at the beginning of the Bundesliga. The operators began to see a more satisfactory result as the public understood the championship better. Fortunately, it came back with everything close to the end, but unfortunately, it had the champion's conclusion a few rounds later. Even so, it established a protocol for other European leagues to return and security for public opinion that it was possible to do. He brought punters back to a league he already knows and whose clubs and players are known.
Soon after the Bundesliga the main European tournaments started to return. Spain's have very strong clubs, like Barcelona and Real Madrid. The Premier League is the main tournament and the most staked non-cyclical property that exists. I say non-cyclical because the World Cup drains a huge movement. The NFL also matches the Premier League, although it is not comparable. The Super Bowl is comparable. It is an annual event only, so it can be said that it is an annual cyclical event. But the return of the Premier League and European leagues has enabled the industry to breathe again. Some customers who reached less than 5% of sales in the most critical period, with the return of European leagues returned to around 70%, a level that makes it possible to plan better and go through the crisis.
Does Sportradar intend to maintain its activities in ping pong and eSports? Will they continue to be Sportradar products?
Yes. eSports, mainly. Our global sales director, Eduard Blonk, recently issued a statement about the future, saying just that. That the sports that helped operators survive in the pandemic have gained ground and may continue to thrive, especially eSports. We thought about the new generation and found it very attractive and there is a lot of investment on the betting site, especially on the sponsorship side. Sportradar was uploading a lot of content about this, as we have a partnership with ESL, which is the FIFA of the organization of eSports tournaments. We used to go up to several Counter Strike and League of Legends tournaments and odds and something about electronic sports, like football and electronic basketball. But this gained a new breath and the sport proved to be pandemic proof. You can organize events more easily and professionally. These leagues will gain more notoriety than they already have. They received investments in broadcasting and became more attractive for betting. They start with a beautiful springboard in this pandemic. And Sportradar embarks on this and so do betting operators.
Returning to Sportradar and one of its verticals. How to collect data and guarantee the integrity of the results?
Before Sportradar and the other role that led me to it, I worked with compliance. Guarantee is a difficult term to reach. What is achieved is to mitigate. In the prudence of language, we seek tools that lead to zero risk management, but ensuring that effectively eliminate risk is very difficult. What we do? We use data and the input we receive from our customers, bookmakers around the world, about what happens in their live odds market. This input is read by a very experienced fraud detection system powered by the trade of almost all operators worldwide. This gives us elements of odd to behave in a very weird way. For example: a game is about to end and has a very strong betting volume that will result in another goal. So, the odds were to go up because the game is going to end. And a very large volume of bets coming from certain regions. And we can read that, that there will be a goal there. And the goal happens. We have a combination of alarms saying that there was a signal from the betting market for an unlikely element and, if it happened, it would succeed in a lot of weird and unusual bets. I always like to make this explanation to better illustrates the situation. We are not talking about a little guy in Ireland with a glass of Guinness in his hand betting money he shouldn't have on his team. We are talking about consecutive bets on several different operations in various locations around the world that cause an odd shift in the market. This is not the result of a single bet. We were able to detect this, but the phenomenon is observed when you see an unusual betting pattern that is rewarded by a game element. And when analyzing this element of the game, it is possible to identify a strange action on the pitch, such as an absurd mark by the referee or a very poor effort by the goalkeeper to avoid the goal. This analysis complements the system's finding and generates an opinion report from us that is delivered to our customers (the federations and the police) in order to investigate this game further. A stage in which Sportradar helps with research elements that we have developed within this integrity division. That is how we have a leading role and the creation of the monitoring systems that exist today in favor of the sports industry.
This creates a lot of security for the federations as for the police power to come and check everything that happened…
Yes. Our manipulation report is so conclusive and secure that something happened that, when there is not, we also state that there was a suspicion. Or we can report that there was an unsuccessful fraud attempt. There was an attempt and most likely some element of the game was bought to score the goal, but it did not happen. Either because the corrupt judge failed to give a penalty or the opponent's attack failed to beat a goalkeeper that was bribed. We managed to find that out. When we deliver a report, it is very conclusive that the game has been rigged. So much so that the TAS (Arbitration Court for Sport) uses the Sportradar reports as full evidence and in its internal statements it is determined that in combating match fixing, the manipulated game, the FGS report (Sportradar system) has such a great weight for evidence like blood testing for doping. They consider that our report is so conclusive that yes, there was fraud, like a substance detected in the player's blood test for doping. There are several convictions that have taken place over the years in which only Sportradar's report was used in the process together with a colleague of mine going to testify at the Court of Arbitration for Sport so that the federations could apply life-long bans from referees, players and even prevent the rise from clubs to UEFA tournaments, for example, which takes integrity seriously. All taken to CAS as elements of Sportradar's work in this regard.
Talking about Brazil, how do you see the process of regulating the gaming activity in the country, especially sports betting, which will soon have its legislation?
It is a complicated topic. We won both sides of the scale in the pandemic. It is a favorable period to plan better and make a more appropriate launch, but it has also reached a situation of attack on the market, since everything stopped and if this happened, the regulation will also cause a delay on this. Anyway, I think it's close to happening. Sports betting will be the leader in this sector. It is already there and the Brazilian public lives with it. The Brazilian population already sees marketing and watches advertising on TV, as well as their clubs and leagues showing advertising about it and already try the product on betting sites. That is, it is already there. It is just a matter of regulating and making it official and making everyone benefit from it. We have to hope that this is well designed.
I think the pandemic has left regulators with a little more time to plan and add other games to sports betting, such as casinos, online casino games, urban casinos, etc. The gambling industry has always wanted to include it, but I thought it would be complicated, thinking it best to allow only sports betting and then the rest. Now, with the government's need to boost the economy, perhaps the casinos will join in with the sportsbooks because of the promotion of tourism and to attract the old public of bingo. I see more discussions about casinos now and the regulation might cover it all.
And how will Sportradar position itself with its partners, the bookmakers, who are already on the football jerseys of many teams in Brazil?
Many of these activations are already ours, within the adds area. Sportradar's contracts had a good volume, both in terms of volume and number of contracts and quality of the partnership, such as the one with the São Paulo Federation and top A series clubs. Anyway, this will become more official and we will have more operators. There is a select group of operators who do not go to unregulated markets, even if they can explore and have good products. These are Sportradar's customers so we know that we will help them break into the market that they did not reach, but that will come later than others. There will be a consolidation of companies looking for the main land winners in the pre-regulation market, which happened in Colombia and Mexico. I strongly believe in the operations performed by Brazilians who have always worked with the game. Either they will grow to a level of strife with foreigners or they will be covered by foreigners and they will continue to run these operations.
We wish Sportradar success in the near future with regulation…
We also believe it is close. We are strategically preparing the ground for a more dedicated performance in Brazil and supporting this industry so that, when regulated, we have a very positive agenda to foster everything it can bring. Greater entertainment, stronger investment position for sport, more content for the media.
Source: Exclusive Games Magazine Brasil