“This Week In Daily” is LegalSportsReport’s weekly wrap of key facts, happenings and miscellany from the daily fantasy sports industry.
Stories of note
Partnering up
Major League Baseball really got into the fantasy business this week: DraftKings became the “Official Daily Fantasy Game” of MLB this week. If you’re keeping track, that makes three of the major North American sports leagues choosing sides in the daily fantasy sports war (NHL with DraftKings, NBA with FanDuel).
Presser from DraftKings here; analysis of the news from us here. The move will raise the profile of DFS and DraftKings in the baseball world, and includes exposure during the All-Star Game festivities. A week earlier, we learned via The Washington Post that MLB had an equity stake in DraftKings, which was not widely known in the industry.
The announcement leaves the NFL as the last major domino to fall in terms of big sponsorships that are on the line. The NFL, as it is known to do, is moving slowly on the issue. It’s still the most valuable deal that is on the table for DraftKings or FanDuel, and will likely change the game for either if it lands a contract.
PokerStars gets into DFS
One of the giants of online gaming — PokerStars — announced its intentions to get into the daily fantasy sports space this week. The news came out of the earnings call for the online poker site’s parent company, Amaya Gaming.
The launch is planned for this year — in time for the 2015 NFL season — although we know precious little about how it will go down. PokerStars could acquire a DFS site to help its entry, or it could just handle the DFS platform on its own.
What’s it all mean, in the grand scheme of things?
- It’s not hard to imagine that PokerStars could become the leader in the DFS space in the coming years.
- An online gaming site getting into the industry could change how legislators and others view DFS.
- It’s the first time a large and already established site will get into the market, so it will be interesting to see if PokerStars provides a fresh take on how to approach contests, user interface and acquisition.
Of the week
Read(s) of the week
“What Is The True Legal Status Of Daily Fantasy Sports?”
While DFS sites will tell you they are a skill game and their contests are legal in most jurisdictions, industry legal analyst Marc Edelman believes that’s not truly the case. While sites haven’t come under legal challenges, that does not mean the contests they offer are necessarily legal across the board, according to Edelman.
And even more concerning this week for many was PokerStars’ entry into the market, which likely muddied the waters even more for DFS’ status as a game of skill instead of a version of sports betting.
“Daily fantasy sports Web sites find riches in Internet gaming law loophole”
If you haven’t read this story from the Washington Post’s Adam Kilgore yet, and you’re at all interested in the industry of daily fantasy sports, you really should. It takes a wide view at the industry, how it got to where it is, and where it’s going.
And the story casually drops in nuggets like this, from DraftKings CEO Jason Robins, talking about the possible billion-dollar valuations of DraftKings and FanDuel: “I think $1 billion is still low,” Robins said. “I think we can turn this into $10 billion-plus. It’s a nice spot to be at for this stage of growth.”
Of course, this story came out before the PokerStars news, which could still fundamentally shift the industry. But for now, it creates a clear snapshot of where we’re at.
Listen of the week
Legal Sports Report’s Chris Grove did the Rotogrinders podcast to talk about what PokerStars’ entry into daily fantasy sports.
Tweets of the week
Not true, but funny:
Poker Stars will incorporate the ability to “FOLD” your DFS lineup if things are looking bleak and get a small % of your buy in back.
— DHP (@DHP) April 1, 2015
You might have seen this in your email on Thursday:
The MLB is wasting no time getting that database of email addresses active to DFS promotions pic.twitter.com/xVtOYdRPRS
— DFSreport (@DFSReport) April 2, 2015
Quote of the week
“It’s a clear, strong crossover with poker. And given the size of our database, you couldn’t actually acquire somebody and leverage their entire platform because nobody’s software that we’ve seen can currently support our volume that we would have if we launched fantasy sports.”
–Amaya Gaming CEO David Baazov, talking about PokerStars’ planned entry into DFS.
Number of the week
91 million
The total number of registered users at PokerStars. Estimates put the total number of unique users in the entire DFS space at 2 million, currently.
