Regulated existence seen in Daily Fantasy sports future
November 17, 2015 3:09 AM
by Phil Hevener
Phil Flaherty has been busy at high levels in the Nevada gaming business long enough to see new, interesting ideas flourish.
He’s also been a witness to interesting ideas that crashed and burned, sometimes for no reason other than the fact they were in the wrong place at the wrong time.
Daily fantasy sports wagering has his attention now, just as it also has the interest of sports fans and investors with appetites for opportunities. His focus is on how the issue will play out as various interests pull it this way and that.
Flaherty contends, “Because there are so many powerful interests, including the sports leagues themselves, involved in the fantasy world now there is likely to be a push at the congressional level to address the true legality of fantasy sports wagering. This should, if the AGA (American Gaming Association) is doing its job right, re-open the door for a real discussion about over-turning the federal ban on expanding sports wagering into new jurisdictions.”
But whatever happens in Washington, he believes big changes are in store.
“The various parties involved in fantasy wagering,” he says, “should have taken a state by state approach to getting themselves legalized and then formed the compacts among themselves so participation pools and prizes can be increased.
“At the end of the day, though, in my opinion the unregulated and freewheeling world of fantasy sports wagering across the U.S. is coming to an end. However, I do believe that as the varied interests try to salvage a viable business out of the current confusion it will force real conversation about what are appropriate regulations for sports and fantasy wagering.”
Flaherty notes, as others have, that there is a “huge amount of money” – way up there in the billions of dollars wagered annually – “and it is silly not to take advantage of the revenue generation. It is even sillier to think a fantasy event cannot be fixed or rigged or that by making sports betting illegal, the threat of fixing or rigging makes the risk disappear.”
He stresses, “Legalizing and tracking wagers will create greater transparency and significantly improve integrity and spotlight illicit activity.”
A former Gaming Control Board member who spoke with the promise of anonymity because he has business interests in fantasy sports believes legal opinions in various states will continue settling on either side of the issue.
“The fantasy business is not going to disappear but it will no longer be unregulated,” he said. “There will be regulations.”
Fantasy sports betting may find safe havens in states such as Florida where legislation to protect it has been introduced and most of the seven professional sports leagues have sponsorship arrangements with the biggest companies in the business.
States such as Illinois and California may also agree to allow its continued but regulated existence.
Phil Hevener has been writing about the Nevada gaming business for more than 30 years. Email: PhilHevener@GamingToday.com.