Is it high time that state lawmakers divert their attention away from DFS, and toward enacting legislation that will legalize online casino and poker games?
During that five-month span, DFS operators generated $18,621,700 in gross gaming revenue from New Yorkers, an average of $3,724,340 per month. The industry’s best month to date came in November, when revenue clocked in at $4,446,317. (You can see the raw data here.)
A total of $2,796,182, or 15 percent, was paid by DFS operators in tax revenue, representing less than a slither of the state’s projected $150 billion budget.
Still, these figures are not totally insignificant, especially in the context that without legislation, DFS operators would have generated exactly zero revenue in a key market.
Yet compared to figures put up by online gambling operators in New Jersey, they come up decidedly short.
It’s still something of an incomplete picture. But we can now glean some idea of how daily fantasy sports stacks up against other US online gaming verticals. That’s particularly true of NJ online casino and poker.
The big picture: The NJ online poker industry moderately outperformed NY DFS. The Garden State’s online casino industry eviscerated DFS.
Over the past five months, New York DFS has generated an average of $0.189 per resident population. By the same metric, NJ online poker has taken in $0.2444, or approximately 30 percent more.
The performance of the surging NJ online casino industry blows both of these verticals out of the water. It generated $1.707 per New Jersey resident — or just over nine times what DFS does in New York.
There are a number of variables that suggest the gulf between DFS and regulated US online gambling is even wider than the data above show. Most notably, DFS numbers are inflated throughout the NFL season.
Eilers & Krejcik Gaming estimate that the entire DFS industry handled approximately $3.2 billion in 2016. The NY report shows industry handle of $1.834 billion in the US and Canada from September through January.
If we take Eilers estimates at face value, is means that 57 percent of annual entry fees were accounted for during a five-month span. Five months represents less than 42 percent of the calendar year.
Other factors that lead us to believe the on-paper disparity is underrepresented:
There were eight states that passed fantasy sports legislation in 2016. More are likely on the way.
Why? There are a few likely reasons:
All this said, it’s time for states looking to fulfill their budgetary shortfalls — Pennsylvania we’re looking at you — to consider gaming verticals that have more of a tax revenue generating upside than DFS.
And those verticals appear to be online casino, and to a lesser extent, online poker.