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We already knew about the recent moves DraftKings made into the sports betting space. This week, FanDuel CEO Matt King told Forbes that if New Jersey wins the Supreme Court sports betting case, his company will join the fray.
It’s no secret that significant overlaps exists between DFS players and sports bettors. That explains in part why King wants to expand from skill into chance:
“(A Supreme Court overturn) would mean we would get into sports betting. This business is around fan engagement and helping fans feel closer to the things they like, and clearly sports betting is one way to help people to do that. So it would be very logical for us to get into it. We have some ideas of how to make that experience better and ones that we feel will resonate with our users. We think we’re uniquely positioned to fulfill that market demand.”
It’s not clear how FanDuel would choose to enter the sports gambling space in this scenario.
Entering the sports betting space appears natural but also represents a big shift for FanDuel. King invested a lot of energy in drawing a line between DFS and gambling during daily fantasy’s state-level legislative push in recent years.
“It is truly a game of skill,” King said in a 2016 Frontline interview. “… Just like football or basketball. The more you practice, the better that you get. Many of the forms of regulated gambling are actively constructed so they are games of chance, and that is a very, very different experience than a game of skill, which is what fantasy clearly is.
At that time, King was the site’s chief financial officer. After leaving, he came back as the company’s CEO at the end of 2017.
The lines certainly blur as DraftKings and FanDuel offer more single-game DFS contests. Adding sports betting, though, steps fully into the gambling space for both.
FanDuel walks a bit behind DraftKings on this issue. DraftKings took major steps toward preparing for a New Jersey sports betting victory earlier this year.
Recent reports that Major League Baseball and the NBA want to divest their equity in DraftKings and FanDuel, respectively, focused on the leagues. As the two leagues lead the charge for integrity fees and other concessions in sports betting legislation, removing those ties makes sense. FanDuel and the NBA would remain partners even if the league gets out of its equity position, both sides have said.
But the NBA likely has no interest in directly owning a piece of a sportsbook if FanDuel truly goes down this path.