If you are reading this article I am assuming that you already know the basics regarding the Supreme Court ruling of earlier today. The purpose of this article is to show you what legalized sports betting means for daily fantasy sports. If you don’t have a background of the Supreme Court ruling, you can read up on the decision here: https://www.cnn.com/2018/05/14/politics/sports-betting-ncaa-supreme-court/index.html . This decision will have lasting impacts on the daily fantasy sports industry.
There is no way around it: this decision is not good for daily fantasy sports.
The major players in the DFS industry, FanDuel and Draft Kings, have already announced that they will be entering the sports betting scene. While the decision will likely help FanDuel and Draft Kings’ bottom line, it isn’t good news for DFS players. Current DFS players will likely allocate a portion of their bankroll to sports betting and some DFS players may transition into solely betting on games. Having less users and entries makes for smaller tournaments with smaller prizes; something that no one in the DFS community wants.
Let’s face it, the most fun daily fantasy contests are tournaments. Tournaments are the part of DFS that FanDuel and Draft Kings feature on their ads. Winning a $100,000 tournament is far more thrilling than making $100,000 through grinding out cash games. Daily fantasy sports wasn’t that much fun in its early stages and that was because of how boring tournaments were. Tournaments in the early days of DFS had very small prize pools with a grand prize that wasn’t even worth the effort.
Ever since their inceptions, FanDuel and Draft Kings have advertised heavily. While they don’t advertise as much as they used to, they are still bringing in new users thanks to their advertising on the television and internet. Both sites will likely shift their advertising focus to the sports betting market since it is far larger than the DFS market. Less advertising means less new DFS users, which means less people playing DFS. As I mentioned earlier, the fun factor in daily fantasy sports heavily relies on the amount of people playing it. The casual fan will choose sports betting over DFS simply because it is easier and requires less time and research.
The aforementioned statements may scare you if you are an avid DFS player, and frankly, they should. However, online sports betting is still a rather far way away from becoming a reality. It will take states a while to pass laws to legalize sports betting. Don’t worry, the DFS that you know and love will still be the same for at least the near future and sports betting will end up being fun as well.
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