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“This Week In Daily” is LegalSportsReport’s weekly wrap of key facts, happenings and miscellany from the daily fantasy sports industry.
The biggest investor in the deal was Fox Sports, who reportedly invested $150 million for 11 percent of the company. Also included in the deal is $250 million in ad spend by DraftKings at Fox Sports properties, although the deal is not an exclusive one like ESPN has with DraftKings.
As a side note, DraftKings also has $50 million in “mystery” investments that were not publicly known previously; we took a look at that issue here.
It wasn’t a good week for payment issues in the industry.
First, Robert DellaFave took a look at identify verification and financial checks at Yahoo’s platform, and found them to be lagging behind the rest of the DFS industry. In fact, he believed their process was more like offshore gambling sites employ than anything else.
Then, we took a look at the sites having issues with paying players, including FantasyUp and Ballr. The former has said in the RotoGrinders forums that players would be paid “by the end of the week,” so we’ll watching for anecdotal reports here. The latter, whose website had been a dead link, now features text saying player balances are intact.
Even if and when the sites pay players, it’s not a good look for the industry, brings up legal questions, and invites regulation for the DFS space.
Jeff Hwang rolls out an argument that likely a lot of people in the DFS industry believe, even if they won’t admit to it publicly: DFS is both a game of skill and gambling, at the same time. The two things aren’t mutually exclusive, he points out:
Hwang isn’t giving a legal briefing, just a look at the core of what DFS is. Of course, some of the DFS industry might also have legal problems to contend with, soon, as well; see the legal analysis currently going on in Nevada.
DraftKings CEO Jason Robins and Eilers Research’s Adam Krejcik (19-minute mark) talk DFS on CNBC:
NGC chairman Burnett believes fantasy sports, and specifically DFS, is the next evolution in gaming that Nevada will have to contend with.
— David Payne Purdum (@DavidPurdum) July 27, 2015
The total of known investment funding in DFS operators. A little more than two weeks ago, that figure stood at about $230 million.
Other news and stories from the world of DFS: