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“This Week In Daily” is ODFReport’s weekly wrap of key facts, happenings and miscellany from the daily fantasy sports industry.
Earlier this week, we reported on an anticipated deal that would make DraftKings the exclusive fantasy sports sponsor and provider for the Ultimate Fighting Championship, the world’s biggest mixed martial arts promotion.
The story moved forward a little bit this week, as a UFC executive noted that the deal was “imminent” and would be for one year. That was on Tuesday, however, and still there has been no official announcement of the deal. So “imminent” is apparently in the eye of the beholder.
Regardless, it sounds like the UFC and DraftKings will be in a partnership soon. The deal is interesting from both sides’ perspectives. DraftKings will pull off a pretty major move in trying to cut into the market dominance of FanDuel, which doesn’t even have MMA contests, currently. It also signals the UFC’s interest in getting into the DFS market, putting a toe in the water if this really is just a one-year deal.
While leagues and teams are still taking sides with FanDuel and DraftKings for the major North American sports, the newest battleground might be alternative sports like MMA.
At this point, it’s clear the NBA is committed to daily fantasy sports, from the deal signed with FanDuel to commissioner Adam Silver’s comments about fantasy sports in a story for ESPN the Magazine last week.
What is not clear is exactly how the NBA views DFS as an industry. Is it gambling in the eyes of the league, or not? That question came into the spotlight after former commissioner David Stern talked about fantasy sports at the Cal Ramsey Distinguished Lecturer Series in Sports Management at New York University:
“I agree with Commissioner Silver that it’s time. Especially in the day and age of fantasy [sports], daily fantasy [leagues]. … It’s still a game of skill and has its own set of issues with algorithms and bet large sums, but it’s time.”
That sounds great, in a vacuum. But just last month, Stern said this: “Once daily fantasy became an acceptable exception to the law against gambling, I think that’s gambling – so now I think the best approach would be, as Adam Silver has advocated, is for there to be federal regulation.”
And then there was this from Silver: “The league and many of our teams are actively engaged in the so-called daily fantasy business. And while I wouldn’t categorize that as sports betting, on the continuum of no betting at all and legalized betting, it’s certainly on the spectrum.”
DFS is only around because of a carveout in the Unlawful Internet Gambling Enforcement Act that differentiates fantasy sports as a skill-based game that is not lumped in with gambling activities. Stern and Silver probably aren’t doing the industry any favors by being wishy-washy about fantasy sports’ status as a non-gambling activity.
The first-ever Daily Fantasy Sports Expo was announced this week, scheduled for August 6-7 in Miami. It’s not clear how this will differ from the biannual conferences put on by the Fantasy Sports Trade Association, other than this conference will apparently focus on just DFS.
Preliminary topics to be addressed at the conference include back-end software, marketing, and alternative fantasy sports (i.e. tennis, auto racing, golf, etc.). The conference already has one good get: attorney Jeff Ifrah, an expert on iGaming law. More on the event here.
This certainly isn’t a totally frivolous lawsuit. At issue is DraftKings’ promise of a 100% match of deposits vis a vis the Florida Free Gift Advertising Law. Deposits being matched in the manner done by DraftKings is nothing new — in fact it is the industry standard. Bonuses are released slowly, as a player enters more real-money contests. But that is not how the initial deposit bonus is advertised by DraftKings.
FanDuel faces a nearly identical lawsuit, although that suit was filed under the Florida Deceptive and Unfair Trade Practices Act. How these lawsuits play out will be interesting to follow.
The market for fantasy contests based on video games could be a hot one in 2015. The first real-money fantasy website for League of Legends, an online battle arena video game, has grown quickly. Just last month in TWiD, we were reporting that Vulcun was offering a quarter of a million in prizes.
Will real-money video game fantasy sports see an explosion in users and revenue like the DFS industry has in recent years? Or is this just a blip on the radar?
A 50 year old woman winning the FanDuel Playboy contest is the best thing to ever happen to DFS
— Chet (@Chet_G) February 8, 2015
“We expected this milestone to take us a year to get to when we launched just 3 weeks ago. But the response from the LoL community has been so tremendous that it has blown us away.”
–Vulcun co-founder Ali Moiz, on increasing the total guaranteed prizes in its League of Legends fantasy contests to a million dollars (via SportsAgentBlog)
Number of professional sports franchises that have signed sponsorship deals with DraftKings in 2015. A deal with the UFC is expected to come this week or next.