You could already argue that pro sports leagues own portions of gambling companies, depending on where you come down on daily fantasy sports as gambling product or a game of skill.
But there’s no getting around the question now, after bookmaker Paddy Power Betfair acquired FanDuel on Wednesday. The existing relationship between the leagues and the two big DFS companies (the other being DraftKings) is coming into focus in a world where sports betting could be widely legal in the US soon.
The NBA + FanDuel + Paddy Power Betfair
Here’s where we stand:
- FanDuel is being acquired by PPB.
- NBA invested in FanDuel and had an equity stake in the company as a result.
- The NBA said it was going to ditch that equity position.
We’re not sure where that puts everything right this second, as I type this. But, it is at least possible that the NBA now owns a piece of a company that will be owned by a gambling company, unless the mechanism to divest already kicked in. Neither the NBA nor FanDuel addressed the equity situation directly or the timeline for ending it, when it came up in April in a report from ESPN’s Darren Rovell.
Regardless, the fact remains that the companies have said in the past that they “will remain close commercial partners now and in the future.” Is that still true, given the PPB tie? Are we in a brave new world where US leagues will partner with gaming companies directly?
Same goes for DraftKings?
FanDuel, until yesterday, had only talked about getting into the sports betting space. DraftKings? They’ve been more aggressive, hiring a head of sportsbook and saying that they are on the precipice of launching a New Jersey sports betting product.
Again, MLB and the NHL have had equity in DraftKings dating back to 2015. And again, the two sides were coy about the disposition of the equity positions while saying they remain committed to their partnership. Here was DraftKings in April:
“Major League Baseball was the first professional league to invest in DraftKings and their partnership over the last five years has been instrumental to our growth and success. Our ties to MLB are as strong as they have ever been. As two organizations that place fans at the core of their business, DraftKings and Major League Baseball will be working closely together going forward so baseball fans around the world continue to have the most engaging experience possible with the sport they love.”
However, all of the above hand-wringing about equity came before the US Supreme Court struck down the federal sports wagering ban. A lot has changed in the month since those proclamations of the relationships between FanDuel, DraftKings and the leagues. The DFS sites getting into sports betting was just a hypothetical before. Now, it’s almost a reality.
Interesting times, if you’re a US pro league or a DFS/sportsbook hybrid.