Will FBI Probe Mean Game Over for Fantasy Sports? (video above): Seth Berenzweig, managing partner at Berenzweig Leonard (berenzweiglaw.com), and Bloomberg's Joshua Brustein discuss probes of online fantasy sports leagues by the FBI and U.S. Justice Department and the extent of charges potentially faced by operators of online fantasy sports sites. They speak on "Bloomberg Markets," on October 15, 2015.
"Online fantasy sports are a multi-billion dollar industry, and fantasy NFL football is by far the most popular fantasy sport." -- Yahoo Finance
Below: Google Trends - Interest over time, search word trend, worldwide, 2015 (this same trend occurs every year with Fantasy football peaking every year in late August-early September: fantasy sports=blue line; fantasy football=red line
Yahoo (NASDAQ: YHOO) Rolls Out New Fantasy-Sports Feature: Daily, Weekly Contests - Bloomberg’s Emily Chang reports on the number of fantasy-sports players across the U.S. and Canada in “BWest Byte” on “Bloomberg West,” July 9th. (Source: Bloomberg)
Money quote: "Betting on sports is illegal outside of Las Vegas but Fantasy Sports 'get a pass' because Pro Leagues consider it a 'game of skill'"--Emily Chang, Bloomberg Daily and weekly contests comprise the fastest growing area of Fantasy Sports. "Links between daily fantasy sports and more traditional forms of wagering are strong. Many members of FanDuel’s executive team used to work in online gambling. (Eccles worked for the UK’s Betfair.) DraftKings is one of the main sponsors of the World Series of Poker, the planet’s largest land-based poker tournament." (source: Quartz, infra)
The bizarre, multibillion-dollar industry of American fantasy sports - Quartz: " ... ESPN, Yahoo, CBS Sports, and the NFL itself, among others, have all built technological platforms for the tasks a fantasy football league requires, such as allocating players fairly among participants, awarding points based on statistical performance, and processing trades of players. The investment in technology is considerable, but for most of the big companies involved, there is a strong business case. ESPN’s head of fantasy sports, George Leimer, says that during the football season, fantasy participants drive 17% of traffic to the company’s websites, which average around 90 million unique visitors each month ... Fantasy players are considered the most engaged fans of the NFL ... Walt Disney (owner of ESPN), which also operates theme parks, has long distanced itself from anything remotely associated with gambling. That could mean it is a two-horse race between FanDuel [which secured $70 million from investors including NBC Sports Ventures, private-equity fund KKR, and the National Basketball Association] and DraftKings for control of the fast-growing short-term market..." (emphasis added)
Fan Duel, Draft Kings, and now Yahoo! According to the Fantasy Sports Trade Association, more than 30 million Americans participate in fantasy football leagues, and spent an estimated $11 billion on the activity last year.
Why Fantasy Sports is NOT Gambling - Fantasy Sports Trade Association: "... The Unlawful Internet Gambling Enforcement Act of 2006 included "carve out" language that clarified the legality of fantasy sports. It was passed by Congress and signed into law on October 13, 2006 by President George W. Bush. The act makes transactions from banks or similar institutions to online gambling sites illegal, with the notable exceptions of fantasy sports, online lotteries and horse/harness racing. The bill specifically exempts fantasy sports games, educational games or any online contest that "has an outcome that reflects the relative knowledge of the participants, or their skill at physical reaction or physical manipulation (but not chance), and, in the case of a fantasy or simulation sports game, has an outcome that is determined predominantly by accumulated statistical results of sporting events, including any non-participant's individual performances in such sporting events..."
