The Grand Wager: How Digital Gambling Reshaped the History and Integrity of Professional Tennis

The connection between professional tennis and the worldwide gambling business is an epic conflict between Victorian culture and the economics of the digital era. Tennis had built a reputation as a high-toned amateurism, a game of gentlemen, a game of glory on a manicured lawn, and it has stood as a kind of moral fortress against the perceived vulgarity of commercial gambling. However, in the 21st century, this historical opposition collapsed, being replaced by a deep commercialization of the sport, in which the infrastructure of sports activities, including match schedules, live data feeds, and so on, is literally built around sponsorship agreements with betting companies.

It was not a gradual change but a curved and zigzag process that experienced morality crises, hesitant data-sharing policies, and an overall philosophical turnaround. Today, tennis is the second-best-bet sport in the world, and its story of how it went on to become a billion-dollar data sales story is one of the most fascinating stories in sports business today.

In 1877, the inaugural Wimbledon Championship was organized, and its whole idea was recreational and social. The culture of clean courts, which was set up at this time, opposed almost every foreign commercial force. In contrast with sports like horse racing or boxing, which were traditionally linked with gambling, tennis took pride in being detached and considered the monetary incentive, and gambling, in particular, to be an abomination to the principles of the sport.

Even the move to the Open Era in 1968, where professionals could compete to win prize money, was done subtly. Although the sport was initially slow to start courtship of the corporate sponsors, the partners chosen, luxury brands, automotive makers, and high-end apparel brands were chosen with the goals of reinforcing the sport's elitist, aspirational image. During the 1970s, 80s, and 90s, the ruling bodies such as the ATP and WTA might have been open to sponsorship by lifestyle brands such as tobacco or alcohol, but gambling was in another category of strictly banned.

During the pre-digital world, tennis betting was a peripheral activity. Betting was mainly on the winner of the match (moneyline) before the start of the match, and the logistical impossibility of updating odds during the match rendered in-play betting nonexistent. The betting was small, since there was no opportunity to bet on individual points or games, and there was a limited motive to involve bookmakers in the sport, and there was little motive in the tennis authorities to lift their long-standing ban.

The internet revolution of the early 2000s, namely with the emergence of the online betting exchange, the first of its kind, led by companies such as Betfair, broke this stable equilibrium. The exchange model that enabled one to bet against the other resulted in enormous liquidity and, most importantly, the ability to bet in a granular and real-time manner. In-play trading would best be done on tennis, where there is a lot of pausing and scoring point by point, which is ideal as it can be conducted at a high frequency. A tennis match suddenly became not a sports event, but a financial market with high frequency.

The consequences were appalling and emphatic. The first large-scale accusations of match fixing at lower tiers of the sport to take advantage of these new betting exchanges occurred through an investigation in 2003. Due to the availability of liquidity into relatively obscure events with relatively low prize money, the economic value of a struggling player throwing a set or a match was often greater than the value of winning it.

The height of the crisis was the "Sopot Scandal" in August 2007, when there was a set match between Nikolay Davydenko and Martin Vasquez Argueello; the money on Davydenko to lose was staggering. During an incident in which Davydenko was later found innocent of, it was a watershed event that left the custodians of the sport no other choice but to take action. As such, the governing bodies, the ATP, WTA, ITF, and the Grand Slam Board in 2008 formed the first anti-corruption unit to be established in the sport, the Tennis Integrity Unit (TIU). This formalized the war against match-fixing, and also formed a requisite, though painful, covert alliance: the ATP entered into a Memorandum of Understanding (MOU) with Betfair to exchange suspicious betting information, an implicit acknowledgement that they require the information that betting operators possess to police dishonesty.

With the volume of in-play betting skyrocketing, the velocity of data was the prize of the day. This led to the so-called courtsiding, the act of a spectator in the venue relaying the result of a point to a syndicate just a few seconds before the official scoring structure or television transmission showed it. This time difference was sufficient to make a considerable profit in the case of algorithmic trading.

The tennis authorities found themselves at a crossroads when they had to fight the data pirates, when it was already a losing battle, but there was an alternative option to this: fight the pirates or sell them the data feed they wanted at a rapid speed and sell it to the betting companies themselves.

They chose monetization.

The option to sell the official live scoring data industrialized the betting product. In 2012, the International Tennis Federation (ITF) agreed with the data giant Sportradar to sell the scores of the Futures tour - the lowest-level professional tennis event - to them on a 70 million dollar deal. This agreement virtually saturated the world market with tens of thousands of matches and players who can hardly earn a living. Although this move earned the sport the much-needed revenue, it was later found by the Independent Review Panel (IRP) to be the greatest trigger of the tsunami of corruption that followed. Through the development of a market for such low-end matches, the governing bodies unwittingly provided a playground to fixers.

The mass match-fixing claims that arose in 2016 compelled the tennis governing body to hire the Independent Review Panel (IRP) to carry out a thorough audit. In 2018, the IRP came out with findings that were damning, in that corruption at lower levels was confirmed to be pervasive, and the sale of data had facilitated the same. To solve this, two radical solutions were proposed by the IRP, including ceasing to sell data based on low-level matches and prohibiting any sponsorship of betting.

Nevertheless, the controlling authorities, with their understanding of the tremendous, required stream of revenue, basically discarded the principal commercial constraints. They contended that they would still not be able to stop data sales because it would only move the market back into the underground, where they would not receive revenue, nor would they see it in the process of monitoring.

Rather, tennis had moved into a strategic shift to complete commercial integration. ATP Tour officially removed the ban on tournaments entering into sponsorship agreements with betting and fantasy sport organizations in December 2020, after financial pressures of the COVID-19 pandemic and after sports betting became legal in the United States.

This historic overturn led to a flood of trade deals. Large online gambling operator companies, including Betway, became part of the ATP and WTA tours, getting into contracts with the most popular tournaments, including the Miami Open and the Davis Cup. The transition solidified the Official Betting Partner. This process was already initiated even by the Grand Slams that work independently, and William Hill was the first official betting partner of the Australian Open in 2015. These joint ventures were not just ones involving courtside branding; they also involved agreements that allowed the betting companies to be able to access official feeds and streaming rights, which allowed them be able to incorporate the betting experience into the fan consumption model.

The usefulness of this stream of information has only increased. During a big business fight over dominance, Tennis Data Innovations (TDI), the commercial division of the ATP, granted Sportradar the worldwide data and streaming rights from 2024 to 2029, replacing a long-term collaboration with IMG Arena. This outrageous transaction, driven by the prospect of new technology such as computer vision and AI to generate high-volume micro-markets (e.g., speed of the next serve), emphasized the fact: tennis information is a multi-billion dollar product.