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Entry Revenues Down at DraftKings and FanDuel
Tuesday October 20,2015 : ENTRY FEES AT MAIN D.F.S. SITES DECLINE FOR FIRST TIME (Update)
Speculation that massive negative media coverage is having an impact.
The massive negative international media coverage on daily fantasy sports "insider" allegations over the past three weeks along with political and legality questions may be starting to impact the commercial viability of the two market leaders, DraftKings and FanDuel.
The UK-based independent monitor SuperLobby says that the numbers suggest that entry fees for the NFL Week 5 guaranteed prize pools on DraftKings were down 12 percent w-o-w last week at $22.9 million, whilst FanDuel statistics indicated that its week-on-week numbers were 3 percent down at $19.9 million.
The total number of paid prize pool entries at DraftKings’ declined 9 percent, with rival FanDuel suffering a 3 percent decrease. On the big-money contests, FanDuel's NFL Sunday Million showed ittle improvement in support, and at DraftKings the $7 million Millionaire Maker fell 10 percent.
Both major operator falls are the first this NFL season, which was prior to the insider scandal recording record figures. Total NFL competition guaranteed prize pools across all daily fantasy sports operators were also down at $7.3 million, a week-on-week decline of 6 percent.
Presumably in response to the crisis, both DraftKings and FanDuel have reduced the guaranteed pay-outs on NFL week six by a million dollars apiece. They have been joined by the Yahoo DFS operation, which has reduced its guarantee in week six following reduced week-on-week action in week five.
Monitors are now closely following statistical developments to assess whether the damage will continue.
In related news, DraftKings has released the findings of an independent third party legal review which it commissioned to study the "insider" allegations that triggered the massive negative media and political fall-out for the daily fantasy sports vertical.
InfoPowa readers will recall that legal firm Greenberg Traurig has been conducting the review of DraftKing employee Ethan Haskell's activities for the past fortnight.
It's report certifies that it has found no evidence of wrongdoing involved in Haskell's $350,000 win at DraftKings rival FanDuel. Specifically, the investigation showed that Haskell made his win 40 minutes before he had access to sensitive internal company information on player ownership percentages, which could have given him an advantage.
DraftKings CEO Jason Robins said that the legal firm also concluded that given the restrictions in place, it was not possible for confidential internal company information to be improperly used.
Whilst the result of the Greenberg Traurig review is positive for the company, it still faces the New York Attorney General's investigation, which it has pledged to support
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