Gambling on a Merger?
It doesn’t seem all that long ago when FanDuel and DraftKings were spending a good chunk of cash on television commercials urging people to play daily fantasy sports which the companies claimed were games of skill, not gambling.
The companies seemingly were flying high and telling everyone to bet. These same companies were enticing people to play their “game of skill” which is the same line that carnival barkers give when trying to attract customers to a boardwalk amusement. However, unfortunately for these companies, something happened along the way when State attorney generals decided that the “game of skill” was gambling. Since, the two companies have been forced out of places like Nevada with FanDuel leaving ten states and DraftKings vacating business in nine states including New York. Needless to say, the value of both companies has dropped and word has recently surfaced that the idea of a merger is a thought now being entertained.
There has been no official determination that FanDuel or DraftKings do indeed operate a sports gambling company. The following four states are the only states that have legalized any form of sports gambling: Nevada, Montana, Oregon and Delaware. New Jersey is trying to open up a Sportsbook as voters said “yes” to a legalized sports gambling site in the state, but a judge refused to allow the same to operate despite the will of the people. A topic of great interest is the fact that the National Football League led the legal fight. In fact, one of the investors in DraftKings is the Kraft Group led by Robert Kraft who is the owner of the NFL New England Patriots’ team.
If an NFL owner is involved in what essentially is gambling in daily fantasy sports, how could that same owner be against New Jersey’s attempt to open a sportsbook? The sports leagues have marketing deals with the fantasy sports companies and make money from those agreements, yet are against sports gambling. Of course, it all depends on the definition of sports gambling.
By Evan Weiner for The Politics of Sports Business.
This article was republished with permission from the original publisher, Evan Weiner.