- Sports Betting
- US Betting
- Daily Fantasy Sports
A new report out from Juniper Research takes a stab at predicting what the DFS market will look like in four years. Its prediction? The total amount of entry fees annually will reach $5.3 billion by 2020. (The firm’s projection for fees taken this year worldwide is $2.6 billion. Revenue in the industry is somewhere between 10 and 20 percent of total entry fees, currently.)
Even in the current environment, that would be a fairly bearish — although not unlikely — estimate for the market. For 2015, research firm Eilers & Krejcik Gaming put the total number of entry fees taken by DraftKings, FanDuel and the rest of the industry in excess of $3 billion.
Some of that predicted growth by Juniper comes not from an expansion of the US market, but from elsewhere as “key players seek to develop new markets including the UK, Australia and Latin America”:
Nonetheless, with several smaller players in operation globally, and an initial foray into the UK by the industry leaders, West Europe will become the next major market over the coming 5 years.
The $5 billion estimate is a lot lower than previous predictions for the market. Once upon a time — in a vastly different climate — Eilers said worldwide handle could eclipse $18 billion annually by 2020.
Earlier this year, Eilers revised those estimates back, with a base case of $8 billion.
Eilers presented a wide range of possibilities, however. In its “worst-case” scenario, revenue would stay flat at about $3 billion a year.
Making a prediction like this is a tricky game for an industry that has been in flux and has seen a lot of upheaval:
Any estimate for the DFS market, given those variables, is just that: An educated guess for an industry that is constantly changing and having to adapt.