[toc]Since it burst onto the scene, the daily fantasy sports industry has done everything it can to disassociate itself from the word gambling.
Growing attention from the industry’s ad spending, along with the brouhaha created by the unintentional release of proprietary data one year ago, led to unwanted attention.
A number of lawmakers and attorneys general began looking into the legality of the product. With regulation on the horizon, DFS stakeholders were careful to always frame their products as games of skill, even if outside observers believe it to be just another form of gambling.
This narrative helped fast track DFS legislation in eight states and counting this year, but the argument over where DFS fits into the large pantheon of games (skill, gambling, and others) is far from settled.
Despite the DFS industry’s desire to avoid gambling, the casino industry is exploring ways to integrate DFS into its properties. These efforts will likely require the creation of new DFS products that are more casino-friendly, even it means sapping most of the skill from DFS.
To develop a viable DFS game that can be integrated into a casino, some game developers are going the other way; not only creating a DFS product that is clearly gambling, but a product with a significant house edge.
One such product was on display at Global Gaming Expo 2016. Among the event’s new initiatives in the past couple years is the AGA’s Gaming Innovation Lab, which gives startups and individuals a chance to display their wares.
John Lukasik’s Scoring Frenzy, a DFS/keno hybrid was one such game.
Lukasik developed the game while attending UNLV’s Harrah College of Hotel Administration (he has since graduated). The fantasy sports junkie said in his presentation that his goal was to “make a game I would want to play.” The finished product is Scoring Frenzy.
The birth of Scoring Frenzy
On the surface, Scoring Frenzy looks a lot like DFS, but under the hood it’s not at all like the highly skillful DFS contests that currently exist. This is a hybrid product designed to have a specific and significant house edge, while retaining some of the elements that make DFS so popular.
“Scoring Frenzy is a house-banked fantasy sports game that casinos can finally offer to the hordes of fantasy sports crazed fans and casual sports fans alike,” Lukasik told Legal Sports Report.
Discovering data that shows a demonstrable skill gap between the top DFS players and casual participants led Lukasik to conclude there was a need for a less skill-dependent DFS product.
“Casual players have no chance to win against these highly skilled players,” Lukasik said.
He went on to say that many DFS neophytes also find the scoring and player selection rules confusing. Lukasik explained the math behind the game as “using randomization to replace the complicated draft pools used with other sites.”
The model behind the computer-generated selection of players is based on some 50,000,000 simulations run on a UNLV supercomputer to which Lukasik had access. The developer also advocated for simplifying scoring by basing it “on more fundamental benchmarks in football, such as touchdowns.”
“My goal is to have a fantasy sports game that casinos will offer which can open fantasy-style game play and make it immediately available to players otherwise intimidated by the traditional DFS sites, while still having enough strategy to appeal to the hardcore fantasy player, who want a new way to play DFS,” Lukasik said.
The mechanics of the game
In Scoring Frenzy, players purchase a ticket (this can be done in a variety of ways: on a mobile device, a video terminal, or some other method) and are tasked with selecting a total of 10 players from three randomly generated groups.
But there is also a skillful element to the game, even if it does have a significant house edge. Participants select four players from a grouping of eight elite players, three from a second grouping of six more middling players, and finally three from another group of six spot players who don’t see a lot of action.
The goal of Scoring Frenzy is to select players who will score touchdowns — nothing more, nothing less. The more selected players score, the higher the payout. If six of the 10 selected players score a touchdown you double your money. If all 10 players score a touchdown you’ll win $10,000 on a $5 ticket.
And voila! That’s Scoring Frenzy, “a fantasy sports game that is easy to play, easy to learn, has strategy, and offers the casual player a real chance to win big,” Lukasik said when I asked him for his best sales pitch.
Are we looking at the first profitable DFS product?
One of the big questions surrounding the daily fantasy sports industry is whether the current business model can ever become profitable. Since they launched, neither FanDuel nor DraftKings have posted a profit.
Because it’s not a peer-to-peer DFS game, and because it’s clearly a gambling game with a significant house edge (similar to keno), Scoring Frenzy has a lot of possible uses. It could be offered at land-based sportsbooks as a terminal machine, as a tablet-based video-gaming terminal at sports bars (where allowed by law), or as an online game.
The obvious limitation of Scoring Frenzy is the number of games that can be played, since it’s based on real-world NFL games.
Scoring Frenzy entries would have to be submitted before the games begin, and since slates of multiple NFL games occur almost exclusively on Sundays it could be difficult to run more than two contests per week during the NFL season. That said, Lukasik noted that other versions will be available to accommodate single-game slates.
“The most common will be for games only on Sunday,” Lukasik said. “However, other versions will include Thursday games, as well as Monday Night Football.”
A second potential drawback is the lack of instant gratification, as NFL games take hours to play out.
These limitations could be resolved in one of two ways.
First, in addition to playing the keno-like DFS product in the run-up to the games at sports bars, Lukasik said Scoring Frenzy could be played anytime during the week, with players creating tickets for the upcoming weekend, much like sportsbooks take bets all week.
Another possibility that would increase the number of chances to place wagers would be integrating Scoring Frenzy with the emerging virtual sports betting market to create even more betting opportunities.
Virtual sports will soon be available at Golden Nugget in New Jersey (more here) and through Pala Interactive. While the traditional bet on virtual sports (which is essentially a computer simulation of a sporting event) is a straight-up wager on who will win or lose, Scoring Frenzy could be integrated fairly easily. A full slate of football games could be played out in just five minutes, with another slate of games starting immediately.
The two products, virtual sports and Scoring Frenzy, seem like a match made in heaven.
Scoring Frenzy is an intriguing product that could appeal to both casual gamblers and hardcore DFS players.
The business model and how it can best be integrated at a land-based casino will still need to be hashed out. But considering the popularity of keno and the popularity of DFS, there certainly seems to be a place for such a game.
The only thing we know for certain is that Scoring Frenzy will not run away from the gambling label.