Unless the Feds step in and block this,DFS is horse racings next worst nightmare.A pal working for an investment bank tells me the handle for DFS will surpass horse racing handle within 5 years if this allowed to go forward.I wonder if the Clueless Clowns running racing even know about or care about this issue.From their overall treatment of the players, you would think not.The prime market for DFS is 18-40 which should also be the target for new horse players. What is not clear is if "some" horse racing handle will divert to DFS betting.Interesting that bills have been introduced in NY/NJ State to legalize Sports betting as politicians smell more money.


Bloomberg:

Daily Fantasy Sites Seen Positioned for Jump to Sports Gambling


Daily fantasy sports(DFS) websites such as FanDuel Inc. and DraftKings Inc. are thriving because they drew a line between themselves and sports betting.
Yet the possibility of legal online sports gambling one day might be the ultimate destination for daily fantasy companies, who are part of the fastest-growing segment of the $3.6 billion industry.

“Legalized sports gambling is the endgame,” said Laurence DeGaris, a University of Indianapolis sports marketing professor who has been a sponsorship consultant for the National Football League, the National Hockey League and companies such as Bank of America Corp. and Home Depot Inc. “One-day fantasy delivers a similar fan experience to gambling, so I expect the current database of customers would provide a good foundation for sports gamblers.”

Daily-play has attracted millions of dollars of investment in the past year from groups such as Comcast Ventures, Raine Group and NBC Sports Ventures. Fortune magazine reported this week that closely held FanDuel is considering another round of fundraising that would value the company at $1 billion. FanDuel and DraftKings have used the venture capital to attract users, enhance their products, partner with professional sports teams and leagues, and offer prizes of as much as $2 million.
Unlike online sports betting, which is banned in the U.S., for-fee online fantasy sports are legal. Participants select real players and accumulate points based on the game-day statistics they generate.

“That’s the only thing I hear about,” Dallas Cowboys running back DeMarco Murray, who led the NFL in rushing, said at a league-organized fantasy football panel during Super Bowl week. “Win or lose for the Cowboys, all they care about is fantasy.”
NBA, NHL

Even after the NFL season, daily-play continues with the National Basketball Association, which has a partnership with FanDuel, and the National Hockey League, which is aligned with DraftKings.
The popularity of daily-play fantasy has more than tripled each of the past three years, according to Eilers Research in Anaheim, California. In the past year, user entry fees more then quadrupled to $1 billion from $245 million.
Sports wagering is even more popular, and the majority of action doesn’t take place at Nevada’s legal sports books. Of the estimated $164 billion wagered on sports in the U.S. in 2013, about $160.3 billion was bet through illegal bookmakers and offshore websites, according to Eilers Research.
Legal Gambling

NBA Commissioner Adam Silver said in September at a Bloomberg Sports Business Summit that legal sports gambling throughout the U.S. is “inevitable.” In a November op-ed for the New York Times, Silver wrote that sports betting “should be brought out of the underground and into the sunlight where it can be appropriately monitored and regulated.” A recent Seton Hall University poll found that 55 percent of Americans support legalized betting on sports.
With a rapidly growing user base and partnerships with teams and leagues, DeGaris said the biggest daily-play fantasy companies are in position to merge with existing online sportsbooks if they don’t make the transition to sports betting themselves.

“The online platform for daily fantasy sports contests, for the most part, already looks incredibly similar to sports books in casinos,” said Marc Edelman, an associate professor of law at Baruch College in New York who consults on legal issues for online fantasy sports companies. “And they were not designed that way by accident.

Fantasy Focus
DraftKings Chief Executive Jason Robins said his company only is focused on bringing daily fantasy play mainstream and said that’s attainable by building the user base.

‘‘Maybe Adam and some other people at the leagues want to see standard sports betting, but it’s so distant for me,” Robins said in an interview. “It’s a possible benefit down the road, but I don’t think about it that much.”
Among the NFL teams DraftKings has partnered with are the Patriots, who this year won their fourth Super Bowl title.
Patriots quarterback Tom Brady, who won his third Super Bowl Most Valuable Player award, has an endorsement agreement with DailyMVP, a daily-play site created by TopLine Game Labs, which last year got $25 million in funding from Cantor Ventures.

Fantasy sports are legal because they’re considered games of skill, according to the Fantasy Sports Trade Association. The Unlawful Internet Gambling Enforcement Act of 2006, which mainly targeted online poker, included carve-out language that makes fantasy sports legal, the industry group said.

“If you look at the players who do well consistently in the fantasy sports games, its very evident that the more skill you have, the better you’re going to do in these games,” David Geller, the chief executive of TopLine Game Labs and former head of Yahoo! Fantasy Sports, said by telephone. “It’s simply not a coin flip. You’ll lose if that’s the way you play.”

Decade Wait
DeGaris predicts the U.S. will have legal online sports betting within 10 years.

“At this point, it’s pretty clear it’s just a matter of time,” DeGaris said. “When the commissioner of the NBA comes out and says it, that’s just prefacing that we’re moving in that direction, trying to figure out the business model and how to regulate it.”
The NBA’s Silver has said that sports betting is popular, legal and regulated outside the U.S., offering the example that bettors in England can place a wager using a smartphone, at a stadium kiosk or with a TV remote control. Many daily fantasy sites also give users the chance to play from their mobile devices as well as their laptop computers.

“Daily fantasy sports at its very essence serves as the gateway toward legalized, online sports gambling,” Edelman said. “The differences aren’t as great as one may think.”