This Week In Daily: May 1, 2015

Posted on May 1, 2015

“This Week In Daily” is LegalSportsReport’s weekly wrap of key facts, happenings and miscellany from the daily fantasy sports industry.

Stories of note

MGM head says DFS is gambling

Jim Murren, CEO of MGM Resorts International, had some comments that no one associated with the DFS industry probably liked very much. In particular:

Professional sports representatives who consider DFS to something other than gambling are ‘absolutely, utterly wrong,’ said Murren.

‘I don’t know how to run a football team but I do know how to run a casino, and this is gambling,’ Murren added.

On the flip side, we took a look at whether daily fantasy’s intersection with pro sports leagues foretells a future of legal sports betting in the U.S.

DFS sites would like to stay out of the business of needing to be regulated. The major North American sports leagues are getting more involved with DFS sites, and while NBA Adam Silver is pro-sports betting, the rest of the leagues probably aren’t very excited about comments like these. The NFL hearing DFS being equated to gambling will likely make the league more tepid on the industry. Which brings us to…

NFL’s ‘cautious approach’

NFL commissioner Roger Goodell recently talked about the DFS industry as well. In typical NFL fashion, it’s taking things slowly.

Goodell said the league will take a “cautious approach” with DFS, and the NFL’s “involvement [with DFS] as clubs is very limited and preferably limited.”

Goodell was responding to the fact that more than half of the NFL’s teams now have some sort of advertising or sponsorship deal with FanDuel or DraftKings.

It also didn’t sound like the NFL would not be entering into a partnership/sponsorship deal with a DFS site before this season. And the NFL definitely won’t be getting into an equity stake with DraftKings, FanDuel, or anyone else. (“Other leagues potentially are investing in these. We are not.”)

 

Latest in legal matters

A couple of developments for DFS, legally this week:

  • DraftKings is facing another class-action lawsuit, this time in an Illinois district court. DK and FanDuel have faced a number of challenges over their claims of 100% deposit bonuses, vis a vis truth-in-advertising laws in states.
  • A Louisiana bill that would legalize fantasy sports passed a committee vote; check out our bill tracker to follow all DFS legislation.

Of the week

Read(s) of the week

“Does DFS Deserve the “Next Big Thing” in Gaming Label?”
It is a question that a lot of people would like to know the answer to. Of course, a lot of smart people are betting on the industry, in terms of huge investments in FanDuel and DraftKings.
The points that this story brings up are the major issues that face the industry right now:

  • The legality of DFS and the prospects for state laws and regulation moving forward.
  • The fact that no one has turned a profit on DFS, yet.
  • The idea that DFS heavily favors skilled players and the issues that poses for the DFS economy.

Is it the next big thing? It sure likes it right now. But those three issues are the biggest hurdles for DFS to clear.

“Fantasy sport an increasingly real business success”

The frontier of DFS beyond the United States is one the industry would love to take advantage of. After all, there are a lot of people in the rest of the world. And a lot of soccer fans.

This story touches on some of the issues for the non-U.S. sector of DFS, with the biggest being the licenses required to operate in most markets. Most interesting in the story were some comments from FanDuel CEO Nigel Eccles, talking about transparency of DFS sites:

“We recognise there are people who are going to have question marks about this industry.We didn’t want to look like some sort of secretive, offshore thing. We didn’t want people to have question marks about our business ethics.”

There are a number of companies beyond FanDuel and DraftKings out there trying to cash in on the idea of daily fantasy sports in Europe. Mondogoal, PlayOn and Squawka are among those mentioned in this story. Will any of them succeed over the long haul?

“Who Is No. 3 in DFS?: FantasyAces Makes Its Case With Bold $30mm Prediction”

This is the latest installment in our series on who is the No. 3 operator in the DFS space. FantasyAces, if actually hands out $30 million in prize pools this year, is certainly a contender for that title.

Stay tuned for upcoming stories about Victiv and DraftDay.

Tweet of the week

Watch of the week

NBA commissioner Adam Silver talks about sports betting on CBS Sports Network:

Number of the week

6

The number of class-action lawsuits that have been filed against DraftKings and FanDuel, at last count. Three have been resolved/settled.

Photo by groundzero used under license CC BY 2.0.

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Dustin Gouker

Dustin Gouker has been a sports journalist for more than 15 years, working as a reporter, editor and designer -- including stops at The Washington Post and the D.C. Examiner.

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