I don’t follow sports too much and I don’t know how fantasy sports betting works, but… How is this NOT considered gambling?
They say there is skill involved. How is that different from betting on the trifecta at the Kentucky Derby? Isn’t there skill in betting on horses? I assume that FanDuel and the KyDerby both use pari-mutual betting, don’t they?
If fantasy sports is not considered gambling, then please explain (and move this thread to GQ).
Relevant news item: Attorney General Tells DraftKings and FanDuel to Stop Taking Entries in New York
Of course, the cynical view is that the NY AG is really saying: “We won’t allow serious money to be made from gambling unless we get our cut.”
The law which carved out fantasy sports as “not gambling” was created several years ago, when things like fantasy football and rotisserie baseball were big, but still largely games played by groups of friends against each other. At that time, the legislators involved in creating that law didn’t feel like clamping down on something which seemed, on its surface, to be relatively innocuous. Personally, I think it’s hard to argue that fantasy sports aren’t gambling, in some form, but the “small potatoes” aspect of it, at least back then, is likely what led it it getting a pass.
What they didn’t foresee was the rise of daily fantasy sports, like FanDuel and DraftKings, and the huge amount of advertising now being put behind it. The boom of DFS seems to have been driven, in large part, by the fact that playing online poker for money became essentially illegal in the U.S. (from what I’ve read, many of the players who are making big money on DFS are the same people who were making a living playing online poker).
When I heard about the NY Attorney General’s pronouncement yesterday, the first thing I wondered was how lottery revenues could be being impacted since the rise of FanDuel and DraftKings (or if the lottery advertising costs have gone up) . There’s really no other logical basis to ban these sites in a state that promotes horse racing and lotteries.
I’m not sure gambling is the precise term I’d use for daily fantasy sports. “Incredible ripoff bordering on a scam” is closer to it in my opinion.
I have zero problem shutting down these sites. And just to be clear, I’d be perfectly happy if every state allowed casino table games. At least people have a shot at being lucky with table games.
What do you mean, Ravenman? People do win actual money on fantasy sports. I’ve been playing for a few years now and I’m several hundred dollars ahead. (And yes, when I wanted to take some of that money out as cash, they promptly sent me a check.)
And I’m no expert - many of the contests are 50/50’s - you only have to do better than half of the other players (so a few experts can’t keep ordinary people from winning) .
One sentence says it all: 91% of profits go to 1.3% of the players who are responsible for 40% of the wagers. It is a racket.
http://www.vice.com/read/i-tried-to-get-rich-playing-fantasy-football-1015
When people found out that the top 1% of Americans take home 12% of income in the US, people started camping in parks because that was so unfair.
I agree that that is likely the reason, but what I don’t understand is why it wasn’t done the way states often make exemptions to their gambling laws for social games. It’s generally done by defining gambling for the purpose of the law in a way that requires someone to profit other than by being a player, for example by charging admission or taking a cut of the pot.
The New York Attorney General’s Cease and Desist Letter (.pdf) explains the argument that Daily Fantasy Sports are gambling, at least according to the New York State Constitution and section 225.00(2) of the New York Penal Law, which provides:
The letter concludes that: “FanDuel wagers easily meet the definition of gambling. FanDuel bettors make bets (styled as “fees”) that necessarily depend on the real-world performance of athletes and on numerous elements of chance. The winning bettors receive large cash prizes – and the company takes a “rake” or a cut of from each wager.”
Based on the statute (and, frankly, common sense), it seems pretty clear to me that the FanDuel/DraftKings “fantasy sports” are gambling, the same way that putting 100 bucks down for the Giants to beat the spread this weekend is gambling. (Actually, it is more like the bet where you pick some combination of teams to win over the weekend, and win big if you get all of them right).
The websites have taken advantage of a loophole in federal law that exempts fantasy sports from the prohibition of internet gambling. However, that federal loophole doesn’t preclude the sites from complying with the state gambling law of each jurisdiction they operate in.
DFS sites don’t even try to hide the fact that the same people keep winning all the money. It’s their basis for claiming it’s a skill game. And I agree with them. I’m up over $50 since the NBA season tipped off a few weeks ago. But I only play $1 - $2 a day.
I’ve never bet on a horse, but I’ve played fantasy football plenty. My guess is that the latter takes more skill than the former. I’m about 15 dollars ahead on three weeks at fanduel, not including those little bonuses they give you for entering a contest. I’m down 30 on yahoo in 8 weeks. I did see a guy on yahoo place about 5 or 6 spots in the top 50. He didn’t win first but his total winnings that week came pretty close.
How is that the “cynical view”? Its the reality view. The state allows gambling under certain licenses that give the state money. These guys are trying to sneak around that.
These companies would pay income tax on the earnings within that state.
Why should the state be able to take anti-competitive actions to preserve their share of gambling spend through the state run lotteries? Clearly, the state doesn’t have anything against gambling, as they are in the business of offering it, they just don’t want anyone else competing against them.
The state gets to regulate its own gambling offerings. It has no control over DFS’ mechanisms to ensure fair play, or its vigorish.