Fantasy sports sites are on the radar of regulators and legislators in several states with the explosive growth numbers hard to ignore. DraftKings guaranteed $10 million in winnings during the NFL’s first week, including a $2 million top prize.
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This private loosening of policy reflects some public policy advances for fantasy sports providers and the industry as well: In California, Assemblyman Adam Gray filed an amended version of AB 1437, the gaming addiction bill now called the Internet Fantasy Sports Game Protection Act.
Daily fantasy is now a nonstop-calendar bet fest in which you can enter multiple daily fantasy contests – you draft a bunch of players and hope they outperform the other contestants’ players – with the hope of a payoff every 24 hours or so.
When you consider how much money these programs and the NCAA all make from the advertising revenue generated by FanDuel and DraftKings, it nearly seems like they’re cutting of their nose to spite their face by alienating the two mega-sites. “NCAA member schools have defined sports wagering as putting something at risk – such as an entry fee – with the opportunity to win something in return, which includes fantasy league games”.
Federal anti-online gambling law does provide an exemption for fantasy sports, so that’s why the DFS operators and their investors are confident with the business. However, there is “carve out” language that exempts fantasy sports, online state lotteries and horse racing. DraftKings’ official website notes that its service is legal because it falls under skill-based gambling, which is allowed in 45 of 50 states.
Now does this mean the students can participate in these sites, as long as they don’t do the college football leagues?
Daily fantasy sports, which allow people to pick cohorts of players and win or lose money based off those players’ performances, were relatively obscure just one year ago. FanDuel came in with the eighth-most money spent with $20 million.
The future of daily fantasy sports in Louisiana is still up in the air. “The fundamental legal definition of what does or doesn’t constitute gambling is generally set at the state level”, Grove said.
Geoff Freeman, president of the American Gaming Association, says the organization welcomes the attorney general’s review.
The last time I looked, poker and betting against the point spread work in a similar fashion.
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“There is no solid data on the volume of illegal sports betting activity in the United States, but some estimate that almost $400 billion is illegally wagered on sports each year”, the commissioner wrote.
