Congress To Hold Hearing On Daily Fantasy Sports In November

[HacheMan]

Congress to hold hearings on daily fantasy sports

Posted by Mike Florio on October 19, 2015, 3:26 PM

[Editor’s note: FanDuel is an advertiser of PFT and PFT Live on NBC Sports Radio. Also, NBC Sports has an equity stake in FanDuel.]

With the daily fantasy industry facing various challenges at the state level, the federal government reportedly is planning to get involved.

Via multiple reports gathered bySportsBusiness Daily, Congress will hold hearings in November regarding the proliferation of daily fantasy sports games for money.

“We were thinking about friends getting together and playing fantasy sports where, at the end of the season, there would be a winner,” Senator Robert Menendez (D-N.J.) told ESPN regarding the 2006 law that legalized fantasy sports, via SBD. “No one envisioned a multibillion dollar industry, daily games, hundreds of thousands of people playing, billions of dollars at stake. And look, at the end of the day, we have poker, horse racing — you can get better at skills by practicing and studying up, but they’re regulated as gambling.”

At this point, the best-case scenario for the industry could be the issuance of comprehensive regulations. The worst case would be a decision by Congress to change its mind about fantasy sports, making it gambling and in turn illegal throughout the country.

Even if the federal government decides to allow fantasy sports to continue with regulations aimed at avoiding, for example, the use of inside information by employees of DFS companies, the industry is still facing the possibility that the states will join Nevada’s effort to protect its own legalized gambling operations — or at a minimum to get a piece of the action.

Ultimately, that’s what’s happening. The FanDuels and DraftKings of the world have created from nothing a machine that is generating millions in cash. It’s apparently now time for Uncle Sam and his 50 nieces and nephews to get their fair share, regardless of what is and isn’t objectively fair.

 

[HacheMan]

At this point, the best-case scenario for the industry could be the issuance of comprehensive regulations.
The worst case would be a decision by Congress to change its mind about fantasy sports, making it gambling and in turn illegal throughout the country.

I think it's very clear that just about everyone who was uneducated on DFS now knows it's definitely gambling and that that latter in bold above is what will likely happen...

 

[HacheMan]

Even if the federal government decides to allow fantasy sports to continue with regulations aimed at avoiding, for example, the use of inside information by employees of DFS companies

But that's the problem & this is what the courts have to realize & understand since they are basically still learning about the comparisons between DFS & Sports Betting:

Sports Betting is a much more honest type of gambling when you consider these VERY SIMPLE steps:

1. A sports books offer odds on a team or the total of the game
2. Players pick one of those
3. The results come in and some win, some lose


In DFS, it can be more complicated:

1. Hundreds, thousands, or millions of players will compete against each other
2. Not that it WILL happen, but since they are the ones sitting behind the computers, the opportunity for the DFS company to cheat will ALWAYS be there as they can enter fake players into the contests to decrease the odds of the public winning & having to pay out, edit lineups during game play & with sooo many entries if would be virtually impossible for any real players to notice, and of course, always hold an advantage with those percentages which are always available to them. Just like sports books who will update what percentage of players are on which side & some will bet against the public, the DFS sites' software obviously updates the same way in showing the percentage of players taken & played. One can easily wait until the last minute to enter a lineup to gain an advantage, so just because a lineup is entered "before lineups are locked", means absolutely nothing.
Again, not saying anyone is or would cheat, but unlike sports betting, there's too many question marks with DFS.

I do love Fantasy though & hope a solution is found...

 

[doubledeuce22]

Pigs get fat.. Hogs get slaughtered

 

[HacheMan]

Word is that this original article may be inaccurate on the time frame...

 

[PatsFan1283]

I think it's very clear that just about everyone who was uneducated on DFS now knows it's definitely gambling and that that latter in bold above is what will likely happen...

Well, I don't think anyone ever thought it "wasn't gambling", that was just the way for the industry to grow by using that language.

Obviously gambling is a subjective term but for the most part people know it is similar to poker and other peer to peer gambling.

 

[PatsFan1283]

But that's the problem & this is what the courts have to realize & understand since they are basically still learning about the comparisons between DFS & Sports Betting:

Sports Betting is a much more honest type of gambling when you consider these VERY SIMPLE steps:

1. A sports books offer odds on a team or the total of the game
2. Players pick one of those
3. The results come in and some win, some lose


In DFS, it can be more complicated:

1. Hundreds, thousands, or millions of players will compete against each other
2. Not that it WILL happen, but since they are the ones sitting behind the computers, the opportunity for the DFS company to cheat will ALWAYS be there as they can enter fake players into the contests to decrease the odds of the public winning & having to pay out, edit lineups during game play & with sooo many entries if would be virtually impossible for any real players to notice, and of course, always hold an advantage with those percentages which are always available to them. Just like sports books who will update what percentage of players are on which side & some will bet against the public, the DFS sites' software obviously updates the same way in showing the percentage of players taken & played. One can easily wait until the last minute to enter a lineup to gain an advantage, so just because a lineup is entered "before lineups are locked", means absolutely nothing.
Again, not saying anyone is or would cheat, but unlike sports betting, there's too many question marks with DFS.

I do love Fantasy though & hope a solution is found...

#2 is actually off....You can download a CSV file when the game starts for every tournament on DK. I'm not sure if FD has that, I think they were just too lazy to do it, but it is very easy to implement.

If the CSV doesn't match up with what the person had at lock or once full lineup known, someone is going to notice. Especially now.

 

[PatsFan1283]

Fwiw I did just talk to a friend of mine that is pretty high up in the industry. He said he thinks it's fucked, could be paranoia on his part since it is his golden egg but it just sounds like the states are going to take a "screw DFS, we can't make $ off of it" attitude

 

[HacheMan]

#2 is actually off....You can download a CSV file when the game starts for every tournament on DK. I'm not sure if FD has that, I think they were just too lazy to do it, but it is very easy to implement.

If the CSV doesn't match up with what the person had at lock or once full lineup known, someone is going to notice. Especially now.

Well you're right that maybe NOW some of those things won't happen.

But as for the percentages, until they make it mandatory that everyone can see the same numbers, just like a sports book does updating the % of which team has been played, then that will be in question...

 

[HacheMan]

Fwiw I did just talk to a friend of mine that is pretty high up in the industry. He said he thinks it's fucked, could be paranoia on his part since it is his golden egg but it just sounds like the states are going to take a "screw DFS, we can't make $ off of it" attitude

I don't think regulation should be considered being "fucked".

Should be viewed as survival and time for rejoicing.

Not wanting states/courts to get involved shows a clear sign of greed...

 

[PatsFan1283]

Well you're right that maybe NOW some of those things won't happen.

But as for the percentages, until they make it mandatory that everyone can see the same numbers, just like a sports book does updating the % of which team has been played, then that will be in question...

There is never going to be 0 potential for corruption obviously. In DFS, in poker, in pretty much all aspects of the financial markets, etc

Best the sites can do is just move towards more transparency. Most of that is a red herring though. Yeah it is needed but it isn't why DFS is potentially headed towards more issues.

The real issue is we live in the USA and online gambling isn't legal here for the most part.

If there wasn't an ad blitz then the sites probably don't have to deal with that, but it was coming to come to a head eventually.

 

[PatsFan1283]

I don't think regulation should be considered being "fucked".

Should be viewed as survival and time for rejoicing.

Not wanting states/courts to get involved shows a clear sign of greed...

Losing FL, IL, PA, NV, CO etc etc isn't about regulation. It is about not letting DFS in your state because you have your own entrenched gambling businesses. Regulation is fine, but the sites can't afford to lose these huge states. That is what I meant by "fucked"

Then who knows what happens federally, I mean we all agree it is online gambling which the US Gov't has not had a positive reaction to in the past.

 

[doubledeuce22]

I just cannot believe how naive the leagues and networks were in getting in bed with the dfs sites.. They really think that some stupid loophole made everything legit? That's this isnt gambling? It's lol funny to think that nobody was going to raise an eyebrow at draft Kings and fan duel marketing on thr outfield walls of mlb stadiums, or the draft Kings lounge at jerry world and Gillette?

these sites are pretty f'd imo.. Because it will likely be a domino effect once a couple more states put their foot down. And what might hurt them the most is Nevada considering it gambling and requiring the gaming license.

Draftkings and fanduel isn't gambling. Good one guys lolololol.

 

[HacheMan]

Losing FL, IL, PA, NV, CO etc etc isn't about regulation. It is about not letting DFS in your state because you have your own entrenched gambling businesses. Regulation is fine, but the sites can't afford to lose these huge states. That is what I meant by "fucked"

Then who knows what happens federally, I mean we all agree it is online gambling which the US Gov't has not had a positive reaction to in the past.

Now both DFS & Sports Betting industries, and everyone who loves both hobbies, can only hope that some experts are correct in saying that all of this will eventually lead to legalization & regulation of both by changing and/or ridding of PASPA & UIGEA.

One of the biggest factors here is that sports leagues, especially the NFL, want DFS.

Therefore, they may have to change their stance on sports betting in order to get their way on DFS since Congress is educated enough now to know Daily Fantasy is gambling...

 

[PatsFan1283]

I just cannot believe how naive the leagues and networks were in getting in bed with the dfs sites.. They really think that some stupid loophole made everything legit? That's this isnt gambling? It's lol funny to think that nobody was going to raise an eyebrow at draft Kings and fan duel marketing on thr outfield walls of mlb stadiums, or the draft Kings lounge at jerry world and Gillette?

these sites are pretty f'd imo.. Because it will likely be a domino effect once a couple more states put their foot down. And what might hurt them the most is Nevada considering it gambling and requiring the gaming license.

Draftkings and fanduel isn't gambling. Good one guys lolololol.

That's why I figured it wasn't going anywhere. Because it was like "How the hell would the NFL/NBA/MLB be all about this and at the same time the threat of its livelihood be real?" Then you got big media boys like Comcast/ESPN/Fox all over it.

It just made sense to think "All these parties are backing it? These are some of the biggest businesses in the world so they must feel confident in its survival."

Some of these states are gonna determine they have no use for DFS pretty fast though. Can't really provide them state revenue like their own gambling, doesn't create jobs, tax base, etc. Just basically needless competition and states don't like that for their gambling interests. Atleast historically....