Unless you are living under a rock, you likely know that the state of New Jersey won its supreme court case when the federal ban on sports betting was determined to be unconstitutional. There are countless articles that have done a good job summarizing the impact of the PASPA repeal at a more macro level, DraftKings has already issued a press release indicating their intent to move into sports betting, and Fanduel is rumored to be in talks with Paddy Power as a potential purchaser. There will be a lot of change in the coming months in years to how America talks about sports betting.
How does this impact daily fantasy sports (DFS)?
In the short term, it seems like the impact will be limited. Most people playing DFS will continue to play DFS, and we’d expect the landscape to remain virtually unchanged through the remainder of 2018. It seems likely that the major sites have already been, and will continue to, invest resources in both DFS games and sports betting. While not doing so “legally”, Americans were already wagering billions of dollars each year on sports. DFS thrived despite that happening and will continue to have its role in fantasy sports, gaming and entertainment moving forward. There is also the possibility that investment in the space in the financial markets would help DFS players via more player acquisition and liquidity, although we are unlikely to see the same marketing blitz for DFS specifically that we did during the hyper-growth phase.
Over the medium term, it seems possible that some DFS players, both winners and losers, may shift towards legalized sports betting. This could happen for those players entirely shifting focus, or just diverting some of their entertainment funds to different channels. On the flip side, many users may sign up for accounts at the major websites and also decide to play daily fantasy while they are there. You could see a logical argument for this ruling flattening the growth of DFS or a scenario where a rising tide raises all ships.
Over the longer term, there will be lots of innovation. Some of that will come in the form of fantasy games. Some of that will come in the form of sports betting. Some of that will come in the form of peer-to-peer contests like pick’em pools and March Madness brackets. And some will be stuff that we haven’t even scratched the surface of. Innovation is generally good!
How does this impact DailyRoto?
The short story is, it doesn’t. We remain committed to producing content for our customers that saves time, helps you learn and improve your ability to predict outcomes of sporting events, and provide a community to increase the level of engagement and entertainment we all get out of sports. Over the past year, we have integrated different tools for our customers, including new optimizers, player prop tools for NBA, golf betting tools, and more. We will continue to look for ways that we can leverage our core competency in projecting player outcomes to produce high-quality content for our customers.
Many will use this opportunity as a short-term cash grab and rush to put out premium picks packages. We won’t be issuing “Drew Dinkmeyer’s Million Dollar Pick of the Week” NFL against-the-spread package, and we will continue to maintain our high level of quality and integrity for anything that is put behind a paywall.
The longer story is, of course, it impacts us, at least a little bit. SportsGrid, the parent company of DailyRoto, owns and operates many properties in the sports, gaming and entertainment space including SportsGrid, FNTSY Sports Network, RotoExperts and PWN. Most of these properties already cover either fantasy sports or betting information and will continue to expand on their coverage. We will continue to partner with and merge with those platforms as the industry evolves.
Regardless of where it goes, it will be a fun ride. For now, we have some daily fantasy tournaments to win.