Will Other Lawmakers Support Future Of Daily Fantasy Sports Like One NY Senator Did?

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New York state Sen. John Bonacic did not just want a fantasy sports law he sponsored to be good for DraftKings and FanDuel.

In a recent letter to the state gaming commission, he wrote that he intended to “cater to many different styles of interactive fantasy sports gameplay” with the bill that became law in 2016.

Fantasy sports law and NY

Bonacic penned a letter earlier this month to the NY State Gaming Commission on the subject of a law that legalized and regulated DFS in the state.

Bonacic worried that gaming regulators were interpreting the law too narrowly. In a memo accompanying draft regulations from NYSGC, the commission’s counsel wrote that the body wanted to “ensure that IFS (Interactive Fantasy Sports) contests remain within the scope of activity the legislature authorized.”

What Bonacic wanted to authorize is pretty clear from his recent letter. In it, he said “I worked to ensure that the regulatory regime we were crafting would not stifle the innovative potential of a new technology industry that had chosen to center itself in our state.”

He went on to talk about one operator in particular — NY-based Boom Fantasy — saying that he would “fully support and endorse” the company’s fantasy sports application.

Boom Fantasy offers gameplay that is somewhat different from DraftKings and FanDuel. It asks users to make a series of predictions about athletes’ performance in sporting events, instead of creating a fantasy roster under a salary cap.

Despite those differences, Boom’s contests still appear to meet the requirements of the NY law, both in wording and intent.

Bonacic’s letter on fantasy

Here’s the full text:

In 2016, I was the Senate sponsor of 5.8153, legislation which authorized the offering of interactive fantasy sports in New York. With the help of many colleagues in the Senate and the Assembly, I drafted and then carefully revised the bill in order to protect an activity that many New Yorkers enjoy, and create regulatory protections to New York consumers.

In addition, I worked to ensure that the regulatory regime we were crafting would not stifle the innovative potential of a new technology industry that had chosen to center itself in our state.

I am proud to see that, almost a year later, the commission has granted temporary interactive fantasy sports permits to 13 different companies. It could not have been easy to set up a brand new regulatory scheme in such a short amount of time, but thanks to your efforts these companies have begun to generate tax revenue for the state while securing regulatory protection for players and hundreds of well-paid technology jobs for New Yorkers. This is truly a home run for New York.

When I drafted S.8 153, 1 intended to ensure enough flexibility to cater to many different styles of interactive fantasy sports gameplay. Competition generated between established incumbents like DraftKings and FanDuel, and innovative startups like Boom Fantasy, will lead the way to a robust industry for all.

I fully support and endorse Boom Fantasy’s application for a permit and license as a fantasy sports operator in New York. Their gameplay is exactly the kind of innovation that I envisioned when drafting and supporting this legislation, and I encourage you to approve their application. As a NY-based company that has grown substantially in the past year, I believe it is imperative that the company be allowed to operate in its home state.

How will other states react?

Boom Fantasy and other alternative forms of DFS have been licensed in some of the 15 states that have enacted fantasy sports laws to date. (Boom, as of this article, had not yet received a license in NY.)

But clearly the DFS industry will not stop iterating beyond Boom and other non-salary cap versions. Already, we’ve seen a fantasy sports product that likely meets the letter of every law while not really resembling fantasy sports in any traditional sense.

A product called FastPick, launched by Resorts in Atlantic City ahead of the NFL season, is one such example of a prediction or parlay fantasy sports platform. Users simply must choose players of a series of matchups. If their players score the most fantasy sports, they win money.

The platform behind FastPick, Sport AD, has designs on leveraging its product in other places with fantasy sports regulations. Will regulators in states see this as too akin to sports betting, and try to find a reason to stop it? (NYGSC’s proposed regulations would ban anything that resembles “proposition betting.”)

Or will regulators and the lawmakers that crafted fantasy sports laws allow operators to push the envelope, with platforms that take full advantage of the law?

Now that we have fantasy sports laws in 30 percent of the states in the country, that’s a policy area to keep an eye on.