[h=1]Future of sports betting: fantasy sports[/h]Fantasy sports have never been more popular. Single-game sports betting is only legal in Nevada. The line between the two is blurring rapidly, though, as the U.S. inches closer to legalization.
David Purdum
ESPN Staff Writer
5/4/17
This NFL season, the evolution of American fantasy sports will be on display at a jazzed-up iGaming lounge, tucked inside a revered casino just off the Atlantic City boardwalk.
A cashier's cage is currently being built inside the iGaming lounge at Resorts Casino, the nation's oldest legal casino outside of Nevada. New video screens for showing live and virtual sports are on the way as well. By the time everything is approved and up and running, sports fans will be able to walk up to a counter, hand a ticket-writer as much as $10,000 and make three predictions on a Sunday slate of games.
Take Aaron Rodgers to score more fantasy points than Matt Ryan, Julio Jones to top Antonio Brown and Ezekiel Elliott to best DeMarco Murray, and you've got a three-leg parlay that pays up to $60,000.
Feeling a little riskier? Plop down $200 on a 500-1, 10-leg parlay across multiple sports, if you want, and go for the $100,000 jackpot.
At 1,200 square feet, the iGaming lounge, with its modern furnishings and interactive devices scattered about, is more Apple store than Las Vegas sportsbook. But it feels like the start of a sea change in how we think of playing fantasy sports.
"I think we're at a crossroads in the country, the expansion of legalized sportsbooks, if you will," Christian Goode, co-founder of consulting firm Ivory Gaming, told ESPN. "Oddly enough, that momentum is probably being driven more by the rise in popularity of fantasy sports than it is by traditional sports betting."
Momentum is building to lift the federal prohibition on state-sponsored sports betting in the U.S., but it's a complex issue that optimistically is expected to take years.
In the meantime, aggressive gaming companies are examining what products they can offer now. They are looking to bridge the gap to legalization with innovative products, designed to mimic traditional sports betting, while also complying with the newer fantasy sports laws.
The line between traditional sports betting and fantasy sports is blurring rapidly and soon may be erased altogether.
[h=2]A growing opportunity[/h]It's pretty clear where this is all going and what the end game truly is for the iconic international bookmakers and the U.S. gaming powerhouses that are hustling themselves into position. Their collective eye is on the massive single-game, American point-spread betting pie -- if it were to be legalized outside of Nevada.
Bookmakers from Las Vegas to the Caribbean say the money bet on the point spread in football and basketball games dwarfs the amount bet on all other wagering options, like money lines, over/unders and props. In 2016, $4.5 billion was bet at Nevada's regulated sportsbooks, where football and basketball -- the two sports most conducive to point spreads -- accounted for better than 65 percent of the overall handle.
That's believed to be only a drop in the bucket, though, compared to how much is being bet illegally on sports outside of Nevada, the only state currently allowed to offer legal, single-game, point-spread betting.
The American Gaming Association puts that estimate at more than $150 billion annually in the U.S. Others estimate the amount is much higher, but with the bulk of the money bet in an unregulated environment, it's difficult to get verifiable data on how much American money is fueling the black sports betting market serving the majority of the U.S.
We may never know how many or how much Americans are betting on sports, unless the federal prohibition on legal sports gambling is lifted. But until then, there will be increased opportunities for people outside of Nevada to stake money on sports, whether it's called fantasy or betting.
[h=2]Fantasy sports have come a long way[/h]Fantasy sports can be traced back to the 1970s, when drinking buddies and co-workers competed in pad-and-pencil rotisserie baseball and fantasy leagues. The Monday newspaper, with the box scores, was a hot commodity. Cash, novelty trophies and bragging rights were at stake in contests that almost always took place over an entire sport season. It was a simpler time, before the internet and before the emergence of the daily version of fantasy sports, which allowed a new opportunity to compete every day or week, instead of committing to a full season.
Around 2015, ambitious daily fantasy companies FanDuel and DraftKings exploded onto the scene, with a massive advertising blitz that brought about serious regulatory scrutiny and eventually forced the sites to shut down in multiple states. At their peak, FanDuel and DraftKings were valued as billion-dollar companies. They are now waiting for federal approval to merge, adding to the uncertainty surrounding what the future of fantasy sports may look like, especially in a potential landscape with expanded legal sports betting in the U.S.
On April 11, Arkansas became the 11th state to pass fantasy sports legislation and ninth in the last two years. Legislation is pending currently in several more states, and many in the industry envision more than half of the nation offering and taxing regulated fantasy sports in the coming years.
The new fantasy sports laws and state regulations generally are modeled off of language from a 2006 federal law, the Unlawful Internet Gambling Enforcement Act. UIGEA established a set of criteria that contests must meet in order not to be considered a "bet or wager" when it comes to processing payments. Fantasy companies have aggressively tested most of the stipulations, except for one 10-word clause: "No winning outcome is based on the score, point-spread."
"That does really seem to be the line," Mike Knapp, co-founder and chief operation officer of USFantasy Sports, told ESPN. "You can't bet on the final score or the point spread or just one player."
USFantasy is another of the new iterations of fantasy sports looking to expand its footprint in the U.S. The first licensed fantasy company in Nevada, USFantasy offers a pari-mutuel form of fantasy sports, offering odds on, for example, which NFL quarterback will score the most fantasy points on a Sunday.
FastPick.com is another game toeing that line.
In May, FastPick.com, the house-banked parlay game soon to be offered at the Resorts Casino iGaming lounge, will launch on a standalone website. Upon approval from the New Jersey Division of Gaming Enforcement, it will be integrated onto Resorts' online casino, one of the top competitors in a growing New Jersey online casino industry, and ultimately through over-the-counter transactions that, at least in process, feel a like something you'd do in Las Vegas. There's a reason for that.
"We wanted to get something as close to a traditional single-game play as we [could], but still have it be compliant with fantasy rules," said Joe Brennan, CEO of Washington, D.C.-based SportAD, a venture capital-funded company that produces FastPick."I think this is as close as you can get right now."
"The opportunity here is not just with existing fantasy players," Brennan added. "But it's also migrating over sports betting customers to what is essentially one of the only legal opportunities that they would have that doesn't require a major cultural shift in the way that they bet."
Other fantasy companies, like Boom Fantasy and WinView, have launched an in-game, peer-to-peer prediction contests. Even the NBA, through its partnership with FanDuel, is giving fans a chance to test their prognostication skills and win $35,000 for Autotrader during its InPlay playoff contest.
"I think you'll see the products that are the most entertaining and the most fun and don't just sort of succeed because of big prize pools, those are the ones that will be successful," Stephen A. Murphy, CEO and founder of Boom Fantasy, said.
For now, though, traditional, season-long fantasy, as it has for decades, owns the largest player base and still has a significant edge over the daily version in the U.S., according to industry experts.
"The money coming into season-long fantasy is different (than daily fantasy)," Peter Schoenke, chairman of the Fantasy Sports Trade Association, told ESPN, "because it doesn't flow directly to the companies. The millions of users at ESPN don't register and pay money at ESPN, but that money comes in through the ecosystem through advertising and sponsorship deals. When you add all that money up, I still think it dwarfs daily fantasy.
"From my perspective, season-long is doing really well," Schoenke added. "It still grows. It still has tens of millions of users and is still growing in every sport. We don't need to breathe life into it."
Fantasy sports are ingrained in American culture, with tens of millions of U.S. sports fans participating. But it's important to remember: that culture has been established in a landscape without widespread legal sports betting.
That's not always the case in other jurisdictions, where it's yet to be determined whether fantasy sports and traditional sports betting can thrive alongside each other.
[h=2]Fantasy sports in the U.K.[/h]Jay Jarrahi is a professional sports trader in the U.K., big New York Giants fan and an experienced fantasy player. Since he was a teenager, the 36-year-old played fantasy football for money, complete with side bets with friends. He watched as the daily version of fantasy sports became popular in the U.S. and looked forward to the arrival of prominent operators DraftKings and FanDuel in the U.K.
"I used to think it would be very popular and that I would be one of those enjoying it," said Jarrahi. "But I haven't even bothered to play it, and some of my closer friends who are also pro traders and long-time fantasy players haven't bothered with it either. If I have time to prepare myself then I may give it a try next (football) season, but I'm not sure I want to do the research."
Daily fantasy sports are in their infancy in the U.K. DraftKings and FanDuel were granted licenses from the U.K. Gambling Commission in 2015. Yahoo! also received a license to operate in the U.K. (ESPN, which stopped offering prize-eligible fantasy leagues last spring, is not interested obtaining a gaming license in the U.K. to offer paid fantasy sports, according to a source). The fantasy companies trying to make headways in the U.K. face a different challenge than they did in the U.S.
Traditional sports betting has been widely legal in the U.K since 1960. Brand-name bookmaking shops line the streets, and millions of punters regularly bet heavily on everything from the European Premier League to the NFL, mostly using their phones. All types of wagers on individual players are readily available through the legal bookmakers they've grown up betting with: Convincing those experienced bettors to invest more of their bankroll in daily fantasy is a tall task.
But DraftKings, which is awaiting federal approval to merge with FanDuel in the U.S., remains bullish on the U.K. market.
"In America, it took us four years to become an overnight success," DraftKings chief international officer Jeffrey Haas said in an April phone interview. "DraftKings launched in 2012 (in the U.S.) and became a part of the popular consciousness in 2015. It didn't happen right away. "In comparison, in the U.K., we're growing faster than we did in the U.S."
While avid U.K. punters like Jarrahi have been hesitant to try daily fantasy sports, some traditional bookmakers are venturing into the space. An executive for European sportsbook Unibet told gambling trade publication EGR Intel that DFS is a "really interesting complement to our sportsbook product portfolio" and "appeals to an even wider segment of sports fans -- the softer, less betting-savvy segments."
This is happening in the U.S., too. The American branch of William Hill has been approved for fantasy sports licenses in Mississippi and Virginia, and Brennan, the CEO of SportAD, says he's in discussions with traditional casino companies interested in FastPick.
"I can see a place for (daily fantasy) as an acquisition tool or as a niche product aimed at a central player type," Alun Bowden, a senior consultant on European markets for U.S. research firm Eilers & Krejcik Gaming, told ESPN. "I can see a place for it as an acquisition tool or as a niche product aimed at a central player type. But it suffers badly in comparison with the instant, simple and engaging nature of sports betting. And I suspect the same will be true in every nation where sports betting is mass market and legal."
The United States may be the next test case.
[h=2]The wait for legalization[/h]Multiple efforts to expand legal Las Vegas-style sports betting in the U.S. are ongoing at the federal and state levels.
New Jersey has taken its fight against the sports leagues to offer legal betting all the way to the U.S. Supreme Court, which should decide whether to take the case by the end of its June term. Several additional states are poised to move forward, after New Jersey's case is resolved.
Two federal sports betting bills have been introduced this year, and, according to a congressional source, a third is in the works. A lobbying coalition that includes Nevada casino and bookmaking giants is being formed by the AGA, which has vowed that it will get legislation to lift the federal ban on sports betting in front of President Donald Trump, a former casino owner, during his term.
Legalizing sports betting isn't an overnight project. It's a complex issue with complicated relationships. Commissioners for the NBA, Major League Baseball, PGA and MLS have indicated publicly that a fresh approach to legal sports betting is worth considering, while the NFL and NCAA remain opposed.
Drake University professor Keith Miller, a law professor with expertise in gaming, is among the crowd who believes it's not matter of if, but when sports betting will be legalized in the U.S. Its impact on the fantasy sports market is up for debate.
"My 'when,' I think, probably has a longer timeline than a lot of people," Miller told ESPN in a phone interview. "I just don't see it as imminent judicially or legislatively, but I think that what will happen is that daily fantasy will just be folded in as one form of sports betting. I really don't see DFS being threatened by [expanded legal sports betting]. I just think [DFS will] be brought within the framework."
Murphy, the founder and CEO of Boom Fantasy, said he wouldn't be surprised to see some customers drift away from daily fantasy sports, like those offered by DraftKings and FanDuel, if traditional sports betting is legalized in the U.S.
"Those sites have gotten so big because effectively they're the closest thing there is to legalized online sports betting in this country," Murphy told ESPN in a phone interview. "So if there is actually is legalized online sports betting, I think you'll see some of their users just choose that."
Some in the industry remain confident in the staying power of daily fantasy, even in a theoretical world that includes widespread legalized gambling.
"When implemented correctly, daily fantasy and traditional sports betting should work as complementary products," Matt Primeaux, CEO of fantasy sports operator StarsDraft by PokerStars, told ESPN in a statement. "A broader, well-executed iGaming regulatory structure will only further enhance the validity of daily fantasy, allowing more players to partake without underlying questions of legality or fairness. I'd expect this to generally propel the growth of both games in tandem versus causing one to cannibalize and subsume the other."
In the coming years, as the line between fantasy sports and traditional sports betting continues to blur, more fantasy sportsbooks, like the iGaming lounge at Resorts Casino in Atlantic City, will begin popping up inside casinos, racetracks and off-track-betting venues in varying states. Some will resemble a hybrid sportsbar-nightclub with competitive esports setups where teams or individuals can compete and potentially bet on games like Madden NFL and FIFA World Cup. Others will try to emulate the Las Vegas sportsbook experience, although on a much smaller scale.
"The opportunity is going to be there for fantasy sportsbook-type spaces, whether they're at the casino, at the track or OTBs," said Brennan. "That's kind of the cultural DNA of a pretty significant part of the sports betting public already."
David Purdum
ESPN Staff Writer
5/4/17
This NFL season, the evolution of American fantasy sports will be on display at a jazzed-up iGaming lounge, tucked inside a revered casino just off the Atlantic City boardwalk.
A cashier's cage is currently being built inside the iGaming lounge at Resorts Casino, the nation's oldest legal casino outside of Nevada. New video screens for showing live and virtual sports are on the way as well. By the time everything is approved and up and running, sports fans will be able to walk up to a counter, hand a ticket-writer as much as $10,000 and make three predictions on a Sunday slate of games.
Take Aaron Rodgers to score more fantasy points than Matt Ryan, Julio Jones to top Antonio Brown and Ezekiel Elliott to best DeMarco Murray, and you've got a three-leg parlay that pays up to $60,000.
Feeling a little riskier? Plop down $200 on a 500-1, 10-leg parlay across multiple sports, if you want, and go for the $100,000 jackpot.
At 1,200 square feet, the iGaming lounge, with its modern furnishings and interactive devices scattered about, is more Apple store than Las Vegas sportsbook. But it feels like the start of a sea change in how we think of playing fantasy sports.
"I think we're at a crossroads in the country, the expansion of legalized sportsbooks, if you will," Christian Goode, co-founder of consulting firm Ivory Gaming, told ESPN. "Oddly enough, that momentum is probably being driven more by the rise in popularity of fantasy sports than it is by traditional sports betting."
Momentum is building to lift the federal prohibition on state-sponsored sports betting in the U.S., but it's a complex issue that optimistically is expected to take years.
In the meantime, aggressive gaming companies are examining what products they can offer now. They are looking to bridge the gap to legalization with innovative products, designed to mimic traditional sports betting, while also complying with the newer fantasy sports laws.
The line between traditional sports betting and fantasy sports is blurring rapidly and soon may be erased altogether.
[h=2]A growing opportunity[/h]It's pretty clear where this is all going and what the end game truly is for the iconic international bookmakers and the U.S. gaming powerhouses that are hustling themselves into position. Their collective eye is on the massive single-game, American point-spread betting pie -- if it were to be legalized outside of Nevada.
Bookmakers from Las Vegas to the Caribbean say the money bet on the point spread in football and basketball games dwarfs the amount bet on all other wagering options, like money lines, over/unders and props. In 2016, $4.5 billion was bet at Nevada's regulated sportsbooks, where football and basketball -- the two sports most conducive to point spreads -- accounted for better than 65 percent of the overall handle.
That's believed to be only a drop in the bucket, though, compared to how much is being bet illegally on sports outside of Nevada, the only state currently allowed to offer legal, single-game, point-spread betting.
The American Gaming Association puts that estimate at more than $150 billion annually in the U.S. Others estimate the amount is much higher, but with the bulk of the money bet in an unregulated environment, it's difficult to get verifiable data on how much American money is fueling the black sports betting market serving the majority of the U.S.
We may never know how many or how much Americans are betting on sports, unless the federal prohibition on legal sports gambling is lifted. But until then, there will be increased opportunities for people outside of Nevada to stake money on sports, whether it's called fantasy or betting.
[h=2]Fantasy sports have come a long way[/h]Fantasy sports can be traced back to the 1970s, when drinking buddies and co-workers competed in pad-and-pencil rotisserie baseball and fantasy leagues. The Monday newspaper, with the box scores, was a hot commodity. Cash, novelty trophies and bragging rights were at stake in contests that almost always took place over an entire sport season. It was a simpler time, before the internet and before the emergence of the daily version of fantasy sports, which allowed a new opportunity to compete every day or week, instead of committing to a full season.
Around 2015, ambitious daily fantasy companies FanDuel and DraftKings exploded onto the scene, with a massive advertising blitz that brought about serious regulatory scrutiny and eventually forced the sites to shut down in multiple states. At their peak, FanDuel and DraftKings were valued as billion-dollar companies. They are now waiting for federal approval to merge, adding to the uncertainty surrounding what the future of fantasy sports may look like, especially in a potential landscape with expanded legal sports betting in the U.S.
On April 11, Arkansas became the 11th state to pass fantasy sports legislation and ninth in the last two years. Legislation is pending currently in several more states, and many in the industry envision more than half of the nation offering and taxing regulated fantasy sports in the coming years.
The new fantasy sports laws and state regulations generally are modeled off of language from a 2006 federal law, the Unlawful Internet Gambling Enforcement Act. UIGEA established a set of criteria that contests must meet in order not to be considered a "bet or wager" when it comes to processing payments. Fantasy companies have aggressively tested most of the stipulations, except for one 10-word clause: "No winning outcome is based on the score, point-spread."
"That does really seem to be the line," Mike Knapp, co-founder and chief operation officer of USFantasy Sports, told ESPN. "You can't bet on the final score or the point spread or just one player."
USFantasy is another of the new iterations of fantasy sports looking to expand its footprint in the U.S. The first licensed fantasy company in Nevada, USFantasy offers a pari-mutuel form of fantasy sports, offering odds on, for example, which NFL quarterback will score the most fantasy points on a Sunday.
FastPick.com is another game toeing that line.
In May, FastPick.com, the house-banked parlay game soon to be offered at the Resorts Casino iGaming lounge, will launch on a standalone website. Upon approval from the New Jersey Division of Gaming Enforcement, it will be integrated onto Resorts' online casino, one of the top competitors in a growing New Jersey online casino industry, and ultimately through over-the-counter transactions that, at least in process, feel a like something you'd do in Las Vegas. There's a reason for that.
"We wanted to get something as close to a traditional single-game play as we [could], but still have it be compliant with fantasy rules," said Joe Brennan, CEO of Washington, D.C.-based SportAD, a venture capital-funded company that produces FastPick."I think this is as close as you can get right now."
"The opportunity here is not just with existing fantasy players," Brennan added. "But it's also migrating over sports betting customers to what is essentially one of the only legal opportunities that they would have that doesn't require a major cultural shift in the way that they bet."
Other fantasy companies, like Boom Fantasy and WinView, have launched an in-game, peer-to-peer prediction contests. Even the NBA, through its partnership with FanDuel, is giving fans a chance to test their prognostication skills and win $35,000 for Autotrader during its InPlay playoff contest.
"I think you'll see the products that are the most entertaining and the most fun and don't just sort of succeed because of big prize pools, those are the ones that will be successful," Stephen A. Murphy, CEO and founder of Boom Fantasy, said.
For now, though, traditional, season-long fantasy, as it has for decades, owns the largest player base and still has a significant edge over the daily version in the U.S., according to industry experts.
"The money coming into season-long fantasy is different (than daily fantasy)," Peter Schoenke, chairman of the Fantasy Sports Trade Association, told ESPN, "because it doesn't flow directly to the companies. The millions of users at ESPN don't register and pay money at ESPN, but that money comes in through the ecosystem through advertising and sponsorship deals. When you add all that money up, I still think it dwarfs daily fantasy.
"From my perspective, season-long is doing really well," Schoenke added. "It still grows. It still has tens of millions of users and is still growing in every sport. We don't need to breathe life into it."
Fantasy sports are ingrained in American culture, with tens of millions of U.S. sports fans participating. But it's important to remember: that culture has been established in a landscape without widespread legal sports betting.
That's not always the case in other jurisdictions, where it's yet to be determined whether fantasy sports and traditional sports betting can thrive alongside each other.
[h=2]Fantasy sports in the U.K.[/h]Jay Jarrahi is a professional sports trader in the U.K., big New York Giants fan and an experienced fantasy player. Since he was a teenager, the 36-year-old played fantasy football for money, complete with side bets with friends. He watched as the daily version of fantasy sports became popular in the U.S. and looked forward to the arrival of prominent operators DraftKings and FanDuel in the U.K.
"I used to think it would be very popular and that I would be one of those enjoying it," said Jarrahi. "But I haven't even bothered to play it, and some of my closer friends who are also pro traders and long-time fantasy players haven't bothered with it either. If I have time to prepare myself then I may give it a try next (football) season, but I'm not sure I want to do the research."
Daily fantasy sports are in their infancy in the U.K. DraftKings and FanDuel were granted licenses from the U.K. Gambling Commission in 2015. Yahoo! also received a license to operate in the U.K. (ESPN, which stopped offering prize-eligible fantasy leagues last spring, is not interested obtaining a gaming license in the U.K. to offer paid fantasy sports, according to a source). The fantasy companies trying to make headways in the U.K. face a different challenge than they did in the U.S.
Traditional sports betting has been widely legal in the U.K since 1960. Brand-name bookmaking shops line the streets, and millions of punters regularly bet heavily on everything from the European Premier League to the NFL, mostly using their phones. All types of wagers on individual players are readily available through the legal bookmakers they've grown up betting with: Convincing those experienced bettors to invest more of their bankroll in daily fantasy is a tall task.
But DraftKings, which is awaiting federal approval to merge with FanDuel in the U.S., remains bullish on the U.K. market.
"In America, it took us four years to become an overnight success," DraftKings chief international officer Jeffrey Haas said in an April phone interview. "DraftKings launched in 2012 (in the U.S.) and became a part of the popular consciousness in 2015. It didn't happen right away. "In comparison, in the U.K., we're growing faster than we did in the U.S."
While avid U.K. punters like Jarrahi have been hesitant to try daily fantasy sports, some traditional bookmakers are venturing into the space. An executive for European sportsbook Unibet told gambling trade publication EGR Intel that DFS is a "really interesting complement to our sportsbook product portfolio" and "appeals to an even wider segment of sports fans -- the softer, less betting-savvy segments."
This is happening in the U.S., too. The American branch of William Hill has been approved for fantasy sports licenses in Mississippi and Virginia, and Brennan, the CEO of SportAD, says he's in discussions with traditional casino companies interested in FastPick.
"I can see a place for (daily fantasy) as an acquisition tool or as a niche product aimed at a central player type," Alun Bowden, a senior consultant on European markets for U.S. research firm Eilers & Krejcik Gaming, told ESPN. "I can see a place for it as an acquisition tool or as a niche product aimed at a central player type. But it suffers badly in comparison with the instant, simple and engaging nature of sports betting. And I suspect the same will be true in every nation where sports betting is mass market and legal."
The United States may be the next test case.
[h=2]The wait for legalization[/h]Multiple efforts to expand legal Las Vegas-style sports betting in the U.S. are ongoing at the federal and state levels.
New Jersey has taken its fight against the sports leagues to offer legal betting all the way to the U.S. Supreme Court, which should decide whether to take the case by the end of its June term. Several additional states are poised to move forward, after New Jersey's case is resolved.
Two federal sports betting bills have been introduced this year, and, according to a congressional source, a third is in the works. A lobbying coalition that includes Nevada casino and bookmaking giants is being formed by the AGA, which has vowed that it will get legislation to lift the federal ban on sports betting in front of President Donald Trump, a former casino owner, during his term.
Legalizing sports betting isn't an overnight project. It's a complex issue with complicated relationships. Commissioners for the NBA, Major League Baseball, PGA and MLS have indicated publicly that a fresh approach to legal sports betting is worth considering, while the NFL and NCAA remain opposed.
Drake University professor Keith Miller, a law professor with expertise in gaming, is among the crowd who believes it's not matter of if, but when sports betting will be legalized in the U.S. Its impact on the fantasy sports market is up for debate.
"My 'when,' I think, probably has a longer timeline than a lot of people," Miller told ESPN in a phone interview. "I just don't see it as imminent judicially or legislatively, but I think that what will happen is that daily fantasy will just be folded in as one form of sports betting. I really don't see DFS being threatened by [expanded legal sports betting]. I just think [DFS will] be brought within the framework."
Murphy, the founder and CEO of Boom Fantasy, said he wouldn't be surprised to see some customers drift away from daily fantasy sports, like those offered by DraftKings and FanDuel, if traditional sports betting is legalized in the U.S.
"Those sites have gotten so big because effectively they're the closest thing there is to legalized online sports betting in this country," Murphy told ESPN in a phone interview. "So if there is actually is legalized online sports betting, I think you'll see some of their users just choose that."
Some in the industry remain confident in the staying power of daily fantasy, even in a theoretical world that includes widespread legalized gambling.
"When implemented correctly, daily fantasy and traditional sports betting should work as complementary products," Matt Primeaux, CEO of fantasy sports operator StarsDraft by PokerStars, told ESPN in a statement. "A broader, well-executed iGaming regulatory structure will only further enhance the validity of daily fantasy, allowing more players to partake without underlying questions of legality or fairness. I'd expect this to generally propel the growth of both games in tandem versus causing one to cannibalize and subsume the other."
In the coming years, as the line between fantasy sports and traditional sports betting continues to blur, more fantasy sportsbooks, like the iGaming lounge at Resorts Casino in Atlantic City, will begin popping up inside casinos, racetracks and off-track-betting venues in varying states. Some will resemble a hybrid sportsbar-nightclub with competitive esports setups where teams or individuals can compete and potentially bet on games like Madden NFL and FIFA World Cup. Others will try to emulate the Las Vegas sportsbook experience, although on a much smaller scale.
"The opportunity is going to be there for fantasy sportsbook-type spaces, whether they're at the casino, at the track or OTBs," said Brennan. "That's kind of the cultural DNA of a pretty significant part of the sports betting public already."
