July is about to turn into August, and daily fantasy sports is still not up and running in New York.
After the victory scored by the industry in June — when the legislature passed a bill that would regulate and legalize paid-entry fantasy sports contests — nothing has happened in NY.
DraftKings, FanDuel and other DFS sites are still not serving New York users as a part of a settlement between the “big two” DFS operators and NY Attorney General Eric Schneiderman.
Here’s where things stand on the New York DFS front:
What’s the governor been up to?
Gov. Andrew Cuomo has not yet signed the bill. In fact, he has not yet asked for the legislature to send him the bill, either.
Why not? That’s part of the machinations of how New York deals with the large number of bills the state passes at the end of the legislative session. Despite conspiracy theorists, there has been no evidence that the delay on the bill being considered is anything other than business as usual in the governor’s mansion.
The governor has been signing bills, even a number of them just last week. The fantasy sports bill simply hasn’t been among them. This is the last we’ve seen on the bill this month:
New York daily fantasy bill still has not been sent to governor’s office as of this morning.
— David Payne Purdum (@DavidPurdum) July 21, 2016
https://twitter.com/KSleight_HB/status/753366576561172480
While the fantasy sports bill is important to the DFS industry and its NY players, it’s just one of a lot of bills the legislature passed this session. It’s also a bill that creates little in the way of meaningful revenue for a massive state budget.
This week, Cuomo has been at the Democratic National Convention, so it doesn’t seem like calling for and signing bills will be on his agenda, unless it happens at the end of the week. But right now, when Cuomo will act on the bill is pretty much a matter of speculation.
The NY impact on DFS
It doesn’t take a rocket scientist to tell you the DFS industry hurts without having access to the New York market. Until the law is signed, DraftKings and FanDuel don’t have access to hundreds of thousands of paying users.
Summer is a relatively slow time for DFS — Major League Baseball DFS contests are the biggest cash cow. The rubber meets the road in the fall when the NFL season, followed by the starts of the NBA and NHL seasons.
DraftKings does offer a number of other sports, and some of the impact can be seen in its headliner events for golf. The Millionaire Maker based on this week’s PGA Championship features a prize pool of $2.5 million, down from $3.3 million for the same event last year.
Not all of that difference can be chalked up to just the absence of New York, however.
After all, DraftKings offered a $4 million contest based on the Masters (It didn’t sell out, but it did turn a profit) and a $3 million contest on the British Open earlier this month. The prize pools for these golf contests are shrinking despite the addition of the UK market for DraftKings. It could simply indicate that the DFS user base isn’t as enamored with the lottery-style contests as it once was.
But still, the PGA Championship Millionaire Maker will have less than half the number of entries it did a year ago (part of that is an entry fee change from $27 to $33). But the bottom line is that the NY market would obviously help offset declining numbers.
Timing for football season
It still seems like a good bet that Cuomo will do whatever he plans to do with the fantasy sports before the NFL season begins.
While there are a lot of things on the governor’s agenda, it’s also difficult to believe that his office isn’t at least aware of the importance of acting on the bill in the short term.
The first game of the NFL season is Sept. 8, a Super Bowl rematch between the Carolina Panthers and Denver Broncos. In reality, the big day is Sunday, Sept. 11, when most teams play their first games and the biggest DFS contests will take place.
Given the stakes for the industry, seeing no action on the bill before those dates would be a shocking development.
So, that still leaves plenty of time for the bill to become law. If and when Cuomo signs the bill, by all accounts DFS sites will be back in operation in New York in short order.
Unless it gets to be late August with no action on the bill, the DFS industry probably doesn’t need to go to DEFCON 1.
