mitchh1124
Footballguy
With all this new info out this past week
Are fanduel and draftkings on the way out?
Or will they be around for good?
Are fanduel and draftkings on the way out?
Or will they be around for good?
Fantasy Football - Footballguys Forums
This is a sample guest message. Register a free account today to become a member! Once signed in, you'll be able to participate on this site by adding your own topics and posts, as well as connect with other members through your own private inbox!
DFS going away or standing the test of time? (1 Viewer)
- Thread starter mitchh1124
- Start date
They both had record weeks.
They might get regulated out of existence, but they'll never suffer for lack of interest.
They might get regulated out of existence, but they'll never suffer for lack of interest.
mitchh1124
Footballguy
if government is getting taxes off the winners
whats the big deal?
why dont they limit the GPPs to smaller number of entries? instead of unlimited
that takes away the luck aspect.
BassNBrew
Footballguy
Tell that to my 100 team 50/50 leagues where my main WR was ejected early in the game for "targeting" when he was just diving to make a block with zero bad intentions.
Colorado Weed has proven what everyone knows all too well- money makes the world go round and our gov't is greedy.
Weed is legal in more and more states hoping to cash in on this 2015 gold rush.
Now here's a new industry bringing in truckloads of $ and people think the gov't will shut down the cash cow? Cmon.
Putting their hand in everyone's pocket sounds wayyy more likely.
Don't forget one state tried to get DFS played on their lottery machines in convenience stores.
Wasn't it Kentucky and that former boy band guy creating this law that only farmers of this select group could grow weed and then they'd legalize weed but only from those specific Kentucky farmers? Some conspiracy theory like this with DFS makes for fun chatter but nothing else.
On top of all this, it's an election year. Which candidate is going to not want this money but instead anger millions of voters?
At worst, Bill Clinton's new site "DFSAndACigar" will compete with draft kings and fanduel.
Apple Jack
Footballguy
It'll survive. But I hope this is a slow process because the WE'RE ALL GONNA DIE!!!!! people are funny.
mrip541
Footballguy
New long form article on NYT front page... I think WE'RE ALL GONNA DIE might be pretty spot on. This is the kind of thing that gets Congress to hold special sessions.
Last edited by a moderator:
If Pros have an advantage over regular players due to their skill then it points towards game of skill. But if some pros have an advantage due to access to insider information then it proves nothing as far luck vs skill.
karmarooster
Footballguy
I don't think "going away" is realistic, but I think the scrutiny over the story this season almost certainly means we'll see evolution.
The Gov. is already taking some money from this because any winnings are taxed as income. FD and DK also pay corporate taxes and are HQed in NY and Mass., although I don't know their full corporate structures they could be sheltering some money off-shore but my general understanding is that their valuations are driven by VC investments and not profitability (they are still in growth stages and are just now starting to turn a profit in NFL due to massive amounts of expenditures on advertising). They may technically be subject to state and federal corporate taxes but may have some sheltered losses to carry forward and avoid paying a large tax bill for the short term.
I don't know what the evolution will be, but it will probably look like:
(1) more states banning DFS games outright. I'm talking about bible belt states that have made the lottery illegal.
(2) other states will likely try to ban outside companies and try to capitalize on the industry with sheltered, in-state games that keep any money in the state (there have been some examples of this attempted).
(3) Other states will try to ban it due to traditional casino gaming lobbies (I'm looking at you, NJ -- congressmen making a fuss about this are doing so because they benefit from a. getting publicity and b. protecting in-state casinos. This is sort of connected to #2 -- casino lobbies in these states would prefer all that Vig going to Harrah's and not FD/DK).
(4) Gov. scrutiny into "wrong-doing" -- to the poster above who pointed out that professional players have an advantage over regulars -- yes, that absolutely makes it a game of skill. You can't game the lottery (aside from back room dealing to secure a share of profits, which is present in every state lottery). You can have skill in a game like poker, or you can be cheating like on FullTilt. It's not clear whether the industry insiders were in the "Phil Ivey" category of skill, or in the "FullTilt" category of cheating (actually, that wasn't the case as they didn't rig the game, but may have exploited private information to increase their edge). Remember when Congress got involved in steroids in baseball, as if they didn't have oh I don't know an entire country to worry about with an economy and national security issues and tax issues, etc. etc., but they chose to grill Rafeal Palmeiro? Yeah, kind of like that. They'll want to get on TV and in the papers. The CEOs will probably be questioned. Lots of bluster. Any kind of legislation that gets passed will probably be full of pork and cater to certain interest groups in certain states (NV, NJ). We'll probably see some sort of DFS company formed by a Native American tribe with sovereignty. This could actually be less safe, because it would be further removed from regulation.
It's hard to be more specific than that, but the times are changing. Whatever the industry looks like for the NFL season in 2015 will be different than how it looks in NFL season 2016.
The Gov. is already taking some money from this because any winnings are taxed as income. FD and DK also pay corporate taxes and are HQed in NY and Mass., although I don't know their full corporate structures they could be sheltering some money off-shore but my general understanding is that their valuations are driven by VC investments and not profitability (they are still in growth stages and are just now starting to turn a profit in NFL due to massive amounts of expenditures on advertising). They may technically be subject to state and federal corporate taxes but may have some sheltered losses to carry forward and avoid paying a large tax bill for the short term.
I don't know what the evolution will be, but it will probably look like:
(1) more states banning DFS games outright. I'm talking about bible belt states that have made the lottery illegal.
(2) other states will likely try to ban outside companies and try to capitalize on the industry with sheltered, in-state games that keep any money in the state (there have been some examples of this attempted).
(3) Other states will try to ban it due to traditional casino gaming lobbies (I'm looking at you, NJ -- congressmen making a fuss about this are doing so because they benefit from a. getting publicity and b. protecting in-state casinos. This is sort of connected to #2 -- casino lobbies in these states would prefer all that Vig going to Harrah's and not FD/DK).
(4) Gov. scrutiny into "wrong-doing" -- to the poster above who pointed out that professional players have an advantage over regulars -- yes, that absolutely makes it a game of skill. You can't game the lottery (aside from back room dealing to secure a share of profits, which is present in every state lottery). You can have skill in a game like poker, or you can be cheating like on FullTilt. It's not clear whether the industry insiders were in the "Phil Ivey" category of skill, or in the "FullTilt" category of cheating (actually, that wasn't the case as they didn't rig the game, but may have exploited private information to increase their edge). Remember when Congress got involved in steroids in baseball, as if they didn't have oh I don't know an entire country to worry about with an economy and national security issues and tax issues, etc. etc., but they chose to grill Rafeal Palmeiro? Yeah, kind of like that. They'll want to get on TV and in the papers. The CEOs will probably be questioned. Lots of bluster. Any kind of legislation that gets passed will probably be full of pork and cater to certain interest groups in certain states (NV, NJ). We'll probably see some sort of DFS company formed by a Native American tribe with sovereignty. This could actually be less safe, because it would be further removed from regulation.
It's hard to be more specific than that, but the times are changing. Whatever the industry looks like for the NFL season in 2015 will be different than how it looks in NFL season 2016.
Last edited by a moderator:
Yes, winnings are taxed and all the DFS sites file 1099s.
I don't think any DFS sites are profitable or will be for quite some time. But if and when they become profitable, they'll pay state and federal income taxes (after exhausting losses that can be carried forward). Meanwhile, they are at least providing some jobs.
This seems pretty likely.
I don't think this will work. It seems unconstitutional.
This is possible, but the fact that the NFL is on the pro-gambling side in this case makes a big difference, I think.
I think regulation is coming eventually, but I think it may benefit FanDuel and DraftKings in two ways.
1. People may be more likely to wager real money if they believe that the government is policing any funny business.
2. FanDuel and DraftKings will cozy up with legislators and regulators and steer the regulations toward rules that lock in their market share and make it difficult for startups to compete with them.
Last edited by a moderator:
Willie Neslon
Footballguy
The only way DFS will go away is if the NFL pulls support and stops lobbying for it. The NFL already came out with the "it's up to the states" stance after the scandal broke which was a huge departure from their previous supportive position. They're not all the way there yet but if they decide it's bad PR for the league to be in bed with these sites and and ad revenue could in anyway be compromised then DFS as it is now is done.
karmarooster
Footballguy
cheese
Footballguy
Great point. DFS slows down when the NFL says so, no sooner or later. Big question is if they stick with it once everything is being exposed.
Warsteinner
Footballguy
The Nevada stuff...I don't wholly understand.
Why not just pay the license?
Some of this(or all of this) is not new ground. Horse racing, every sport betting, poker, online casinos- they exist. They don't collapse and didn't when stuff hit the fan. How does all that precedent relate to FD and DK?
What's with if the servers are at this place and the gamers are at that place? There are some laws or previous issues where this mattered.
I understand Atlantic City isn't what it was, but they still permit gambling stuff and have laws in place and all, right? If Boston and NY company, why can't they just shift from Vegas to AC?
Serious Q, sounds frivolous but seriously- Why doesn't Jason Robins just pack up his people and office and all and move in with some Native American Tribe onto their reservation? (This is not 1800, reservations can be extravagant and well built and prosperous)
I do not know the particulars at all but Native American Casino Owners sure know everything we've been discussing and how to deal with the federal limitations and such.
How hard could it be to get them to agree-"My business brings in X millions per week, can we come there?"
All these gambling people and gambling things are crushing this hobby.
Why not just pay the license?
Some of this(or all of this) is not new ground. Horse racing, every sport betting, poker, online casinos- they exist. They don't collapse and didn't when stuff hit the fan. How does all that precedent relate to FD and DK?
What's with if the servers are at this place and the gamers are at that place? There are some laws or previous issues where this mattered.
I understand Atlantic City isn't what it was, but they still permit gambling stuff and have laws in place and all, right? If Boston and NY company, why can't they just shift from Vegas to AC?
Serious Q, sounds frivolous but seriously- Why doesn't Jason Robins just pack up his people and office and all and move in with some Native American Tribe onto their reservation? (This is not 1800, reservations can be extravagant and well built and prosperous)
I do not know the particulars at all but Native American Casino Owners sure know everything we've been discussing and how to deal with the federal limitations and such.
How hard could it be to get them to agree-"My business brings in X millions per week, can we come there?"
All these gambling people and gambling things are crushing this hobby.
As soon as they pay the license and say it is gambling it would seem to me they lose the protection of the carve out in the anti gambling statute. I believe the Nevada commissioner said this was not a ruling impacting full season games, just the daily sites, creating a distinction between the two.
No, the whole point of the carve-out is that it makes fantasy sports (including most forms of DFS) legal under federal law regardless of whether anybody feels like calling it "gambling." What people call stuff doesn't matter. Whether it fits the statutory criteria for the carve-out is what matters, and most DFS games do. (But probably not golf or NASCAR, IMO.)
Last edited by a moderator:
Debatable at best as there has never been a case as to the legality of these games that I'm aware of. And what it's called absolutely matters as to perception and political reality.
What's the statutory argument that NFL DFS isn't within the safe-harbor provision of the UIGEA? There "has never been a case," but what would the case possibly be about?
The legality of golf and NASCAR are pretty questionable, and we may get a case about them in the future. But that doesn't matter for purposes of your initial statement and my response to it. Applying for a Nevada license has zero impact on whether golf, NASCAR, or any other DFS contest meets the criteria in the UIGEA. Different statutes, different jurisdictions.
Last edited by a moderator:
bicycle_seat_sniffer
Smells like chicken
I believe the their annual losses are currently measured in the zillions. Some internet detective work might turn up whether it's closer to two zillion or six zillion, but either way, they are bleeding red.
Marauder
Footballguy
karmarooster
Footballguy
I don't know that the numbers are out there (they are private and therefore don't file public quarterly accounting statements, but then again I haven't looked).
They are bringing in a ton of revenue but don't have profits to show because of a ton of money spent on advertising and development costs. They have billion dollar valuations in the same way that companies like twitter and uber can have modest (or negative) profits but have investors willing to purchase x% for $y million/billion, yielding a huge valuation of y/x.
But it would seem Nevada feels this doesn't meet the safe-harbor provision. Have they gone after FFPC, NFFC, or other full-season games?
Nevada probably has no opinion on whether it meets the safe-harbor provision, and doesn't care.
The safe-harbor provision is for federal law.
Nevada cares about its own state law (which it believes DFS sites are violating, and is probably correct -- here's the statute in question).
Last edited by a moderator:
Wonderllama
Footballguy
It won't go away. There's too many rich people invested in this.
BassNBrew
Footballguy
Yeah? Well, it is true...as the video states...I used an "algorithm to change out an injured player from my lineups last week, too. I think I called it "quick player replace". It gives me a tremendous advantage over the other players.
