DFS, skill, luck and probability debates continue

December 01, 2015 3:00 AM
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DFS, skill, luck and probabilityWith all the stories over the New York courtroom battle of if Daily Fantasy Sports (DFS) is skill-based or not and how it differs from season long contests, the topic of when is something a gamble versus an exercise in skill has become the determining discussion for the future of DFS in New York. As expected, the major online fantasy sites produced supporting experts to argue skill is the dominant factor in winning DFS contest, and not unsurprisingly the state disagreed.

But when does a DFS bet shift from luck to skill?

During the regular NFL season we can generally watch on a given week 16 games. One of the more popular DFS sites runs their contest by requiring nine players to be selected crossing at least two different games and two different teams. So on a given week DFS contest participants could choose a combination of nine players from 32 teams, which could create combination populations of potential selections of over 35.1 trillion unique fantasy team selections.

To just randomly select a combination from that pool with no “handicapping” basically would mean you have a 35.1 trillion-to-1 shot of selecting the combination of players that score the highest fantasy points. Better odds can be found in most state lotteries or a keno game. However, most all fantasy bettors do some form of “handicapping,” precluding team combinations that have no merit at all thereby dramatically dropping the pool population to legitimate combinations of fantasy selections.

By “handicapping,” the fantasy bettors are attempting to increase their probability of higher scores and becoming legitimate contenders in their respective betting pools. While studying player history will enhance the bettor’s statistical probability, they are still in great need of the convergence of uncontrollable factors. Those uncontrollable factors range from things such as: in game injuries, play selection, execution of play selection, referee accuracy, weather changes, equipment failure, fatigue, field conditions among many other independent conditions.

When all things are equal, the superior statistical analysis, which we call “handicapping,” indisputably should prevail. However, the wild cards of performance by not only the players but coaches, referees, equipment managers, grounds keepers, and weather to name just a few, increase the elements of chance against statistical probability.

Anyone watching the Bears vs. Packers game on Thanksgiving, particularly a Packers fan, will wonder how the game outcome would have been different if in the final quarter when a Packer pass completion in a wide open field was whistled dead and instead of a huge yardage gain was turned into a 5 yard offside penalty against the Bears. Or if in the final minute of the same game, the Packers’ receiver had pulled in and completed an end-zone pass, which would have likely won the game for the Packers.

Statistical analysis would have suggested the Packers QB was the much better selection than the Bears QB. However, blame it on the weather, the officiating, injuries, the mental sidetracking of other events of the day – the Bears QB scored more fantasy points. The point being, historical performance is not a perfect definitive predictor of future performance, especially when there are so many independent elements.

When comparing daily fantasy vs. season long fantasy contests, probably the biggest issue is the lack of being able to change your teams through the course of the contest. In most daily contests there is no ability to manage your team; meaning if one of your team picks is injured or benched there is no ability to change, you are stuck with your choice.

However in season long contests “trades” can be made and the ability to “trade” allows for managerial skill to dominate fantasy team picking. While not eliminating the luck factor altogether, “trades” do mitigate luck in favor of good strategic team selection management throughout the season.

Though each state reviewing DFS has to measure its permissibility based on that state’s laws related to gambling and individually decide whether fantasy betting is a gambling activity or a skill activity, the real underlying message is our American citizenry wants to bet on sports and fantasy sports affords the opportunity. As a very wise and long time gaming executive said to me, it “allows the public to safely bet a little to win a lot.”

Fantasy is not really the public’s preferred way to bet, it just happens to be the most widely available one.

The Analyst is an experienced gaming industry executive who offers insight each week on events and issues affecting the industry. Email: Publisher@GamingToday.com.

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