Thursday, 15 October 2015

Gambling by computer - Daily Fantasy Sports issues

Daily fantasy sports is IMHO, clearly gambling, thou its seems to have been largely accepted that specific provisions in the UIGEA (Unlawful Internet Gambling Enforcement Act) - created a loophole.

I say seems, as the UIGEA author, recently wrote a paper, countering this, as the UIGEA had no idea, DFS would grow so exponentially, over the last 2 yrs.

Something with a $150m advertising budget, and allows paid entries, competing for money-prizes, based on skill/luck, to me, has the all the attributes of gambling. (DraftKings, recently spent $24m in TV advertising, in one week).

Now, the USA is v sticky about computer gambling, and specifically, 5 states - Arizona, Iowa, Louisiana, Montana or Washington. prohibit it so strongly, both DraftKings and Fanduel, do not allow entries from residents of those states.

This has become an issue, as the DFS employee, who won $300k, on Fanduel, may have been in Louisiana, when he placed his entry - and that's a BIG problem.

DFS is growing so exponentially, it bares a lot of similarities to the Poker Boom, when, average players could pick up $100k a yr, for doing v little. This time round, I feel federal oversight will come far quicker .. and oddly, may help the cause for the legalisation of sports betting.

Amaya, (owner of Poker Stars), can now legally operate in the internet gambling market of New Jersey .. what this quite means, is a trifle unclear, but, I would expect to see Poker Stars available on computers again, to New Jersey residents, (and as Poker Stars has a sports book, its not a long reach, to see them offering odds etc).

As specific states, get revenue, others will want there share of the pie.

Amaya (traded on Toronto stock exchange, is currently $31, up from $25 a yr ago).

I think its probably a buy.

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