There is no Chris Moneymaker of online daily fantasy sports, but if the DFS industry—led by multibillion dollar brands DraftKings and FanDuel—isn’t careful, it’s going to end up meeting the same fate online poker is still trying to recover from.
The similarities are too much to overlook. Poker was big, but after Moneymaker’s World Series of Poker Main Event title, the game got huge, especially online. Poker sites spent nearly a decade trying to outspend each other on advertising and partnerships with professional players, all to draw in more and more amateur saps who were more than happy to lose their stack in an effort to win big one night, or the next, or the next.
There were poker shows—branded by all the big sites at the time—on every channel imaginable, from ESPN to Fox Sports to leisure outlets like the Game Show Network and Travel Channel.
https://www.youtube.com/watch?v=mUn1Td4iatw
Poker was huge. Money was flowing in from all over the world, and every venture capitalist worth his dime wanted a piece of some online card room to cash in on the casual fans spending their hard-earned money going up against professionals, all from the comfort of their living rooms.
Nothing could stop poker, except poker. A few shady business deals involving some prominent pros at the biggest online sites helped create a huge scandal involving the specter of insider trading—or the online poker equivalent—which got the United States government to step in and shut the whole damn thing down.
It’s been years since poker online was at its highest point, ruined by its own obsessive growth and questionable business practices, then stymied by government intrusion because those in charge could no longer be trusted with the public’s well being.
An entire industry went flat in an instant. Someone at one of those card rooms still owes me $20, too.
What happens when DFS companies make the same mistakes, and fail to learn from what ruined the poker industry? What happens when the government shuts down DraftKings and FanDuel for similar reasons to why they shut down PokerStars, Full Tilt and Absolute Poker?
What happens when DFS gets hit with their own version of Black Friday?
Moreover, what does the poker industry think of this DFS boom, and potential doom? Are they jealous? Are they hoping the DFS scandals cools down, the government stays out of it and everyone realizes we’re adults with our own mone precluding Americans from doing what we want with that money is ridiculous when we would happily allow you to tax our earnings online in exchange for the ability to get back a multi-million dollar industry you destroyed in 2011?
Is it that?
“It’s weird,” ESPN poker analyst and sports media critic Norman Chad told AA in a conversation last week. “With poker, people were engineers or lawyers or in med school and they all dropped out to play poker. Hilariously, now, poker pros—literally poker pros—are leaving poker to play daily fantasy.”
https://youtu.be/V_wz6s0HHRs
Chad pointed out that several professionals were early investors in DraftKings, saying they “saw over the horizon the ‘new big sexy’ for them.” Many poker players have switched to online fantasy as a means to make more money.
Noted poker author Ed Miller has shifted some of his focus to the DFS world, telling AA, “a clear subset of the poker community has jumped to DFS as the ‘next big thing,’ with a good number of the bigger players like rayofhope and Assani and SamENole and so forth coming from poker.”
He pointed out that, despite some big-name gamblers moving from poker to DFS, he doesn’t see “a ton of crossover,” stating that most players in his circle aren’t that interested in DFS.
“I’d say the interest in poker among DFS players is higher.”
That doesn’t bode well for either industry.
The idea that top players have left the poker world behind for DFS and other forms of online gambling may not bode well for the entire gambling world online. Players aren’t in business to save an industry, they’re in the business to make money however they can most efficiently and consistently do so. If it’s poker five years ago and DFS now, in five years it might be something else.
As long as money can be won, professional gamblers will be there to win it.
“I joke about this,” Chad told AA, “but daily fantasy will just eat through the economy. I know people will always find more money to gamble, whether it is sports betting, whether it’s the lottery. No matter how much they lose they’ll always find another nickel or dime under the cushion. Daily fantasy will take that last nickel or dime.
https://youtu.be/r4gvFpSASnY
“There’s something about it that’s so diabolically alluring to the most innocent person.”
Chad is right. There’s a seediness to poker that isn’t there on the surface of daily fantasy. We’re all watching the games anyway, so why not throw a little fantasy action on top?
“Fantasy is so alluring, it’s so easy,” Chad continued. “It’s another reason to root for your players and your teams. It’s so easy, so I think daily fantasy can be with us forever until the money dries up. Incredibly, and I don’t know how this happens, the money never dries up.”
“Somehow, when everyone runs out of money they always find more money, so yeah, daily fantasy can be with us forever.”
Unless the government takes it away.
That’s become a real concern with DFS, especially after an “insider trading” scandal has both DraftKings and FanDuel reworking their policies to keep daily users satiated and federal legislators at bay.
This wasn’t quite Black Friday, but it could have been, if not for the billions of dollars connecting DFS companies to big media corporations and the leagues themselves.
The DraftKings/FanDuel commercial explosion is making me nostalgic for the Cialis/Viagra ad boom.
— Norman Chad (@NormanChad) October 8, 2015
I wanted to know if poker players who lost their revenue stream when Black Friday hit in 2011 were jealous, for lack of a better word, of the fact that DFS hasn’t had to play by the same rules, in part because owners like Robert Kraft and commissioners Roger Goodell and Adam Silver are backing them, both with partnerships and, in some cases, venture capital.
Chris Grove, who pens the Online Poker Report and Legal Sports Report, said the poker community isn’t completely aligned on this topic, but said he doesn’t believe most want DFS gone.
“I don’t think any significant part of the poker community is genuinely rooting for DFS to fail,” Grove told AA. “I think some – myself included – have legitimate questions about the legality and the economic viability of the product, but that’s a far step from rooting for something to fail.”
Grove told AA most poker pros are rooting for poker. “I don’t think there is an anger or jealousy necessarily – maybe a frustration,” he said, “but I don’t think that’s directed at daily fantasy sports, especially since there’s a reasonable amount of crossover between the products. I think the frustration is more directed at the political process, gambling law, and so on.”
In other words, maybe online poker isn’t dead yet. Several states have adopted online gaming in-state, something Chad said could help the industry on a small level, but nothing close to what it was on a national, or even global scale. Grove offered that if states begin to regulate DFS, it’s possible online poker could “tag along on that type of legislation.”
If nothing else, online poker should be rooting for DFS to succeed. It’s probably the fastest way back.
Rich Muny of the Poker Players Alliance has dedicated much of the last four years trying to get online poker legalized again. He told AA he sees challenges as well as opportunity when watching what DFS is dealing with right now.
“The attention gives us opportunities to promote the great game of poker legislatively,” Muny offered, “but the attention DFS is getting may drive a push in Congress to set limits or even to ban the activity. We would have to protect against poker getting included in such a bill.”
In other words, it’s all a big wait and see.
If DFS follows the path of online poker, both could be gone. If DFS scales back the ad buys, stays out of the spotlight to some degree and doesn’t have a Black Friday-esque scandal on the horizon, it could be good for everyone.
And wouldn’t it be good for everyone? We like to rail on DFS in sports media because their ads are SO in our faces, but there is no real reason why poker and DFS aren’t legal, other than the government doesn’t trust us with our own money.
Chad explained the situation in a way only he could, saying, “it’s very simple: you legalize it, you regulate it, you tax it. That’s it for any business, but for some reason because of morality when it comes to gambling, when it comes to alcohol and when it comes to sex, those three industries, there’s always somebody out there who wants to ban it.
“You can ban gambling, you can ban sex and you can ban alcohol all you want and people will always find a way to gamble, drink and screw.”
If the powers that be in these big-ticket DFS companies aren’t smarter, they’ll be the ones getting screwed. And the players, especially those who still have $20 in their accounts they can’t get out. Just like the schmucks who lost theirs playing online poker.
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