An informational hearing took place yesterday within the House Subcommittee on Commerce to discuss the daily fantasy sports industry of the United States. The hearing was strictly informational in nature as there is no legislation currently in place for consideration of DFS regulation on a federal level.
During the beginning of the hearing, United States Representative Frank Pallone of New Jersey decided to discuss the hypocrisy of certain companies and groups that claim daily fantasy sports is not gambling. As he spoke, Pallone criticized DFS operators FanDuel and DraftKings for applying for a gambling license in the United Kingdom but stating their contests are not like traditional sports betting when conducting activities in the US.
The representative went on to state that fairness and transparency is needed in the DFS industry, as he cited information that shows around 90% of the money paid by DFS sites goes to the top 1% of players taking part.
President of RotoWire.com and Fantasy Sports Trade Association Chairman, Peter Schoenke, testified during the hearing on the player and market size, sharing data that close to 50 million Americans play fantasy sports in some form in 2015. In Canada and the United States, the DFS market is worth $26 billion.
Additional testimony was completed by Dr. Ryan Rodenberg, a Florida State University Professor who focuses on sports law analytics. Rodenberg’s opinion is that DFS contests should not be looked at on their own but in a context of nationwide sports betting. Rodenberg stated that it is difficult to evaluate daily fantasy sports without taking a look at the sports betting industry.
While Congress is just now considering the daily fantasy sports industry, individual states have been busy reviewing the industry and making decisions for some time. While some have decided to deem the activity illegal, other states have decided to regulate gaming. Tennessee has already passed legislation for regulating DFS and joined Virginia and Indiana in allowing the industry to function within state borders. Colorado is the latest state to move legislation forward for DFS regulation with a bill now sitting on the Governor’s desk, awaiting signing into law.
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