It’s difficult for anyone outside the United States to truly appreciate how fantasy sports has permeated popular culture. Sure, something like the official Fantasy Premier League, which is popular in the UK, has around 5 million players worldwide. But it’s not treated with the same sense of seriousness as those who partake in daily fantasy sports (DFS) in the US. It’s as if US players treat the game as a business decision, whereas the rest of the world looks upon it as a casual bit of fun.

Fantasy sports, of course, are a business first and foremost, with the big operators, like DraftKings and FanDuel dominating the market. They have a share of around 95% of the entire US fantasy sports pie, with the DFS industry as a whole taking in revenue of around $320,000,000 in the 2016/17 year. That’s just over double the amount the Lakers are paying to LeBron James over four years. It’s a huge amount of money, but it’s not “Amazon-level” revenue. 

Industry still in its infancy

The money generated by the DFS industry probably reflects the fact that its still trying to find its feet as a viable industry. While there is increased hope for some clear policy and regulation on fantasy sports and gambling, investors might still be reluctant to get on board when lawmakers could pull the plug. Plenty of investors got their fingers burnt with the boom and bust of US online poker sites in the early 2000s.

However, both DraftKings and FanDuel have their eyes on bigger prizes. Namely, global domination. The former has made a move to expand into Australia, with operations also beginning in the UK and Europe. Already both companies go a bit further than the classic Big 4 sports, offering everything from soccer to golf and NASCAR. 

Blurred lines between betting and fantasy games

But, because there is expected to be a softening in the law with legal sports betting, both companies have signalled that they will continue to move into sportsbooks. Moreover, they have also suggested that more profits will be generated through betting. It is, of course, not such a strange idea the world of fantasy sports betting and regular betting are already closely tied. Is there much difference between betting on the Patriots to win the Super Bowl and putting Tom Brady in a paid-for fantasy sports team because you believe he will have a good game?

The question is: if DraftKings and FanDuel are the Facebook and Twitter of fantasy sports, can someone become the Snap Chat or Instagram? It seems doubtful as it’s unlikely a new player in the market can come up with something different. Moreover, it’s incredibly difficult to dislodge operators with such a tight grip on the market. Sure, there are some really innovative operators out there, like Fanamana, who offer an InGame Fantasy app for baseball, but it looks increasingly like a David vs Goliath situation. 

Indeed, if anyone comes along to challenge FanDuel and DraftKings, it might not be a tech startup but one of the traditional big sportsbooks. Companies like William Hill, GVC Holdings and others have revenues which dwarf the DFS companies. They have long lusted after a slice of the American betting market, yet they have been put off by the legal issues. Going in on this increasingly blurred area of betting and fantasy sports might just be what helps them do it.