“This Week In Daily” is LegalSportsReport’s weekly wrap of key facts, happenings and miscellany from the daily fantasy sports industry.
Stories of note
Another escalation for FanDuel vs. DraftKings
Battle lines keep getting redrawn as the two largest DFS sites compete for supremacy in the market. In a little more than the past week, here’s what we have seen:
- First, news broke that DraftKings and Disney were near an investment deal that would also result in half a billion in ad buys on ESPN networks.
- Then, reports came out saying FanDuel was near another round of fundraising that would result in a valuation of $1.5 billion.
- Finally, a source said FanDuel and SiriusXM satellite radio were near an exclusive deal.
Clearly, the two sites are moving fast to lock up sponsorship deals that will help them win the war in the DFS space. Given recent activity, we feel like it’s safe to assume we will see a lot more deals signed in the coming weeks and months.
eSports DFS is a huge new sector
FanDuel and DraftKings aren’t the only DFS sites looking at major rounds of funding. Vulcun, which offers real-money fantasy contests based on League of Legends and other video games, just partnered with Sequoia for $12 million.
The investment is easily the largest in the fantasy eSports space, and it is one of the largest in DFS history.
It’s clear, at this point, that fantasy sports for video games was a market just dying to be tapped. After all, DFS for eSports didn’t even exist just last year.
The question is this: Will the well eventually run dry, or is there enough interest in the fledgling vertical that it can be sustainable — and profitable — in the long term.
Of the week
Read(s) of the week
A great read from the New Yorker, looking at the past, present and future of fantasy sports. We learned from the story that the idea of fantasy sports is so ubiquitous, there’s even a fantasy game based on the Iditarod — yep, the dog-sled race.
A recent long-form Washington Post story was a more matter-of-fact look at the industry. This story has a lot more color and flair, and is a really interesting look at fantasy sports.
Everyone can agree that there is still plenty of room for innovation in the world of DFS. Melissa Blau, of iGaming Capital fame, is betting on a new way to play DFS, called “Fast Fantasy.”
While the logistics of how the game works certainly aren’t worked out yet by the new venture, making DFS easier to play and less time-consuming sound like winning ideas. From Blau:
Rather than take hours to manage & select a team to then compete against thousands of fantasy players, only to see the overwhelming majority of prize money go to a small handful of sharks – no one’s idea of fun, right? We believe that everyone will have the same opportunity to win with FastFantasy.
However, dumbing down the format of DFS might also reduce its ability to call itself a skill game. That could have a negative impact on the industry from a legal standpoint, both in terms of how it is treated under current law and how lawmakers view it in the future.
Some rapid-fire reads on DFS as a skill game and its status under the law:
“I Believe Daily Fantasy Sports Is a Game Of Skill, And Here’s The Proof”: Seth Young, COO of Star Fantasy Leagues, set out to prove with data that DFS is not a game of chance.
“Fantasy sports vs. illegal gambling: Where’s the line?”: A pair of lawyers in the iGaming space take a look at legal issues fancing DFS.
“8 Legal Challenges Of Major League Baseball’s New ‘Daily Fantasy Sports’ Partnership With DraftKings“: Industry expert Marc Edelman breaks down some other legal issues that are floating around in DFS.
Watch of the week
Fantasy golf has grown astronomically, culminating with the $2.2 million guaranteed Masters contest at DraftKings this week:
Graphic of the week
A look at the lay of the land for sponsorships landed by FanDuel and DraftKings:
Tweets of the week
DraftKings owes Disney a monthly avg of $11.9mm for ads over 3.5 years. And 20% of their company. Darth Vader has done well for his Master!
— Joe Brennan Jr (@joebrennanjr) April 6, 2015
–Talking about a pending deal where Disney gets an equity stake in DraftKings in exchange for $500 million in ad buys.
Ultimately, if I’m the leagues, I’d say daily fantasy is a form of gambling that we’re comfortable with. — David Payne Purdum (@DavidPurdum) April 9, 2015
Quote of the week
“When people say, ‘How do you feel, having invented this?’ I say, ‘I feel the way that J. Robert Oppenheimer felt having invented the atomic bomb.’ I really do. I mean, pretty terrible!”
–Daniel Okrent, one of the inventors of Rotisserie baseball, a forerunner to modern daily fantasy sports
Number of the week
The number of weeks Vulcun.com‘s real-money fantasy esports contests had been live before the site received an eight-figure round of funding.