BUSINESS

Real money play boosting $800M fantasy sports biz

TAGs: daily fantasy sports, fanduel, fantasy sports, UIGEA

Real-Money-Fantasy-SportsEver since Arnold Rothstein fixed the 1919 World Series, pro sports leagues in North America have maintained a staunch no-gambling-on-our-teams position. However, they endorse no such prohibition when it comes to gambling on individual players via fantasy sports (unlike some employers, who blame fantasy leagues for some $1.5B in lost productivity).

Fantasy sports were specifically exempted from the onerous 2006 Unlawful Internet Gambling Enforcement Act, and this tacit approval has given rise to an $800M industry in which some 30M North Americans took part — 7M of those playing for real-money prizes (and those figures are a couple years old). Much was made of the Philadelphia Inquirer’s partnership with real-money fantasy site FanDuel back in April, but there are now seven major daily newspapers who have entered similar arrangements with the English-based FanDuel, which expects to become profitable within the next year.

Lost in all these positive numbers is the explanation of why gambling on individual players would be just fine with the North American leagues, whereas gambling on the games remains verboten. After all, the recent well-publicized cricket scandal involving the Pakistani team was not about the overall outcome of the Lord’s Test, but on the individual performance of a few players. The Economist magazine thinks it may have the answer to that question, pointing out in a recent article that North American athletes are far better compensated than players in other regions/sports (with the obvious exception of football/soccer) and thus, with their pockets already well-lined, are far less susceptible to the enticements of criminal spot-fixers. An interesting theory, but personally, we wouldn’t be shocked to learn that someone in the players’ unions ghostwrote that article in an attempt to justify their members’ outlandish salaries.

Comments

views and opinions expressed are those of the author and do not necessarily reflect those of CalvinAyre.com