Disney World could become much more entertaining

[Roger Dorn]

Disney to Invest $250 Million in Fantasy Site DraftKings

http://www.wsj.com/articles/BL-269B-3216

[CC's Desperados]

The baseball season has kicked off this week and the Masters will be played next week. Over the last week in Vegas in between the two weekends, I did the research on the whole player pool for the Masters due a chance to be Dave Potts for a day. If you are interest in golf and a chance at the million for a $20 entry, I'll send you the written content. My E-mail address is [email protected].

If you don't have an account, you can click on this: https://www.draftkings.com/r/SportsDD to get set up.

I’m flying out from Vegas early in the morning so it may take me some time to send out a response if anyone is interested.

[Greg Ambrosius]

Disney to Invest $250 Million in Fantasy Site DraftKings

http://www.wsj.com/articles/BL-269B-3216

This is huge, huge news. ESPN said that they would compete in the DFS arena by the football season and there were few who thought they could compete with Fanduel and DraftKings as a startup. This 20-30% stake into DraftKings makes perfect sense. This is a huge deal for the entire industry.

There will always be other DFS competitors, but this now puts Fanduel and Draft Kings into an even higher echelon. If they controlled 95% of the market before Disney got involved, look out. DraftKings is going to be a real big player now.

I like it. It just brings more exposure to the fantasy sports industry and as we proved in baseball there's still enough interest in the season-long game. Everything can prosper with increased marketing in DFS.

Here's the story for those who didn't click the link:

By
Shalini Ramachandran
and
Amol Sharma
CONNECT

Walt Disney Co. is investing $250 million in online fantasy sports business DraftKings Inc., valuing the company at roughly $900 million, people familiar with the matter say.

The Boston startup lets fans play fantasy sports with real money at stake. They can do so on a per-game basis rather than committing to manage teams for an entire season.

It’s an area of digital media that’s rapidly growing and attracting attention from some of the biggest media companies. Comcast Corp.’s venture arm, for example, backs a rival company, FanDuel Inc., which is the biggest player in the space.

In return for Disney’s investment, DraftKings has committed to spend large sums of advertising dollars – just north of $500 million – on ESPN’s platforms in coming years, the people said. That provision is a major attraction of the deal for Disney.

FanDuel can continue to advertise on ESPN but won’t have the premium positions afforded to DraftKings. The fantasy sites are churning through cash to market themselves and acquire subscribers.

Others who have invested in DraftKings in earlier funding rounds include The Raine Group, Redpoint Ventures, GGV Capital and Atlas Venture.

Sports fans have long had an array of online options for fantasy leagues – from Yahoo to ESPN to CBS — where they can pick players in mock drafts and follow their performance over the course of a season.

DraftKings and FanDuel are different in that people can play for cash. That gives such services a potentially lucrative revenue stream that advertising-supported web sites don’t have, and explains why media giants are interested in getting a cut of the action.

There is still some uncertainty in the media world as to whether such services constitute online gambling. DraftKings says on its website the business it is in is a “game of skill” and is 100% legal under U.S. and Canadian law.

DraftKings says it offers daily and weekly contests for cash prizes covering all major sports, including Major League Baseball, the National Football League and the National Basketball Association.

An ESPN spokeswoman declined to comment. A DraftKings representative had no comment.

Fortune.com last month reported Disney was in talks with DraftKings.

The DraftKings deal is the latest sign Disney is betting on growth in digital media. The media giant last year paid $500 million for Maker Studios — one of a crop of “multi-channel networks,” companies that distribute online videos via YouTube and other sites.

With big-ticket acquisitions like Marvel and Lucasfilm under its belt, the company has bolstered its portfolio of intellectual property and creative talent and is now using deals to enter new digital businesses that complement its existing brands.

Disney has a mixed track record for its technology acquisitions. Its 2010 deal to buy social gaming company Playdom Inc for $563 million was badly timed, as the sector soon fizzled.

The ESPN ad deal comes as ad sales overall have been soft for cable networks and sports rights fees continue to rise, weighing on ESPN’s profits. For the quarter ended Dec. 27, Disney said cable operating income was down 2% to $1.3 billion due to a decrease at ESPN driven by higher costs.

Ben Fritz contributed to this story.

[DOUGHBOYS]

I don't know what is good or what is bad for the industry anymore. I do know that it is changing.
Back in the day, we reveled in the painstaking approach of starting or being part of a fantasy league. If leading the charge, Commish's knew that statistics would take a lot of time to process. For us, the time and effort was worth the juice of playing fantasy sports.

Fast forward to now. We live in a time where everything is at our fingertips. Statistics are ready-made. Now, we bitch and moan about the time it takes for FAAB. Patrons of fantasy sports do not want to put more time into their hobby. For the most part, limiting time is the goal.
Time has played a part in Slow Drafts. Time is playing a part in rosters that we won't even have to manipulate. Time seems to be consuming the season long game at a fast pace.

Time is making this era a match made for daily games.
Play and forget is preferred over play and fret. Daily games eliminate most of the thought processes that season long games require.
Knowing that Troy Tulowitzki is 10-26 against Kyle Lohse with a home run is a lot easier to think about for one day rather than asking ourselves for six months if Tulo will stay healthy.
A hitters history with a pitcher becomes more important than sabrmetrics.
Today's weather more important than study.


Daily games, for the most part have taken over fantasy airwaves in season. Statistics like Tulo's past against Lohse are spoken more than any sabr stat.
Sabr stats are dinosaurish for daily play.
Daily play does take the anguish out of fantasy sports. There are no season long injuries. Not even a dl trip.
In daily play, it is known who will be in the lineup. When NFBC lineups are made on Monday, we give it our best shot as to how many times a player will be in the lineup.

Disney putting money into fantasy sports would have been a dream of all of ours 10 years ago.
Now, it seems like they are backing the future of fantasy sports.
In my mind, these are the 'good old days' of fantasy sports. There are many choices and every group is happy.
But, all of us see the changes on the horizon. Time, and now money, is clearly on the side of the daily games.

[Greg Ambrosius]

Dan, now is not the time to lament the new growth area of the industry. Much of the audience playing daily fantasy baseball are new to the industry and wouldn't be playing fantasy baseball without the daily aspect. Maybe -- just maybe -- they will enjoy their initial experience and gravitate to the season-long game. Without DFS, we may never have reached that person.

Churn rates will also play a role in the sustainability of daily. I trust there will always be enough new players to keep the growth at a fevered pitch. But a few years of getting eaten by the sharks could increase the churn rate of those who thought DFS was so easy. I'm not predicting it, but it does seem very possible.

Anyway, if ESPN pitches daily fantasy football like SiriusXM Fantasy Sports has done with the DFS games then the exposure will be a good thing only in that we weren't getting that kind of exposure before. You are exactly right, 10 years ago we saw the growth of our industry and said "just imagine how big this industry would get if ESPN ever promoted it." Well, they are knee deep into the industry now and they have a big vested interest in its growth. That's a good thing and soon you will see even more exposure for this hobby from other networks and league affiliations. And before it's done, I promise some of that added exposure will be for season-long games. I know there's interest in exposing what we're doing here, so stay tuned.

The industry is growing like very few other hobbies. That's a good thing.

[KJ Duke]

And before it's done, I promise some of that added exposure will be for season-long games. I know there's interest in exposing what we're doing here, so stay tuned.

The industry is growing like very few other hobbies. That's a good thing.

I agree, Greg. DFS is a different animal with broader appeal, but I also think it will help fuel growth in season-long leagues. Long-term the full season leagues may only be a niche part of the industry, but niche industries can grow and become increasingly profitable without a slew of new competition.

[Donacion]

With ESPN involvement all one has to do is look at the World Series of Poker or the X-games. Some of the participants are now main stream especially with marketing. Not to hard to envision the day when there is a high stakes draft with camera pointed at cheat sheets and projections. Also would not be surprising to see some of the more camera friendly and eloquent participants get sponsorship. You can almost see it now the $100,000 entry tournament brought to you by the King of Beers.

[DOUGHBOYS]

Of course, I hope you fellas are correct. Maybe I'm a little more pessimistic than most.
To me, it isn't about the money as much as it is about ease and time. Both of which compliment the daily game more than ours.
I don't believe that most new fantasy players, due to the dollars in the daily game exposure or advertising from huge investors, will cross over to our game.
Maybe that's just me.
As said before, it is a different game.
Some season long players are in their 30's, most in their 40's, 50's, and 60's.
This age group will carry the season-long game as far as possible. I hope it is a very long time.
Younger players like a play now- pay now approach. A six month grind? Not their style.
Younger players have less money as a whole too. Paying $150 to play in a Draft Championship is expensive.
Putting $20 in an account and playing 25 cent to $2 dollar games is more the style.

I know I fall on the unpopular side here. I don't want to, but I have to be honest.
I do not want to see the daily game take over our hobby either.
But, it seems to be a flood. The Daily game is pouring in our hobby from every crack and hole.
Fantasy sports as a whole gets larger and is more impowered with that flood.
Our game, the season-long game, is still healthy and stable. THAT is the important thing for now.
We're stemming the tide.
For the future, floods have a way of eroding things that get in their way.
At most, I'll enjoy this and the next few years of seasonal play.
At the least, I'll be wary that season long play becomes less of a part of our hobby.

[Greg Ambrosius]

Yahoo Sports yesterday launched their DFS baseball contest, a precursor to the football game that debuts in September. Here's the details from the New York Times:

http://www.nytimes.com/2015/07/09/techn ... 71195&_r=2

Yahoo Will Enter Daily Fantasy Sports Market

By VINDU GOEL and JOE DRAPEJULY 8, 2015

SAN FRANCISCO — Even as legalized gambling has spread nationwide to include lotteries, casinos and just about every imaginable type of slot machine, the notion of betting on sports has remained, outside of Las Vegas, largely in the shadows.

But on Wednesday, Yahoo took the boldest step yet to bring what amounts to legalized betting on sports to the mainstream. The Silicon Valley company, which has been broadening its range of sports content, said it would host daily and one-week fantasy sports games played for money, starting with Major League Baseball and expanding to other professional sports as their seasons begin.

As any viewer of ESPN would know, the fantasy sports industry has been growing rapidly, with ubiquitous ads proclaiming that hundreds of thousands of dollars can be won on sites like DraftKings and FanDuel. But none of those companies, all start-ups, have the vast reach of Yahoo and the ability to entice tens of millions of young men — a coveted audience — to bet on the performance of their favorite players.
Photo
With its new daily and one-week fantasy sports games, Yahoo is entering a fast-growing market that could bring it hundreds of millions of dollars in new revenue. Credit Jim Wilson/The New York Times

Yahoo’s move further legitimizes a pastime that closely resembles gambling, particularly with the daily fantasy games. Players can bet against a single opponent or within a small group, and the quick results can simulate the adrenaline rush and financial stakes of traditional sports betting.

Fantasy sports operate under an exemption to the Unlawful Internet Gambling Enforcement Act of 2006, which outlawed online poker and sports betting. Lobbyists from the National Football League, as well as from other professional leagues, successfully pushed to have fantasy sports deemed a “game of skill.” Most states permit the games, but the betting is illegal in five: Arizona, Montana, Louisiana, Iowa and Washington.

Ken Fuchs, Yahoo’s vice president for publisher products, said that fantasy sports were different from gambling because they relied on the skills of the player. Yahoo already runs cash leagues for fantasy sports that last the length of a season, and the daily games are no different.

“We stay very close to the laws,” Mr. Fuchs said. “We certainly encourage people to play responsibly.”

Playing fantasy sports is one of the most popular pastimes for Internet users, with an estimated 57 million people in the United States and Canada participating this year, according to research conducted by Ipsos for the Fantasy Sports Trade Association.

Fans assemble rosters of real football, baseball or basketball players to create dream sports teams, then earn points based on how well those players perform in real games. Participants tend to be avid, spending an average of $465 a year on contest fees and materials, according to the Ipsos research.

The N.F.L., National Basketball Association and Major League Baseball — traditionally ferocious opponents of betting on their sports — were the first to embrace gambling on fantasy sports, aware that the passion for it is crucial to their bottom lines. ESPN, CBS and Yahoo, among others, have since built season-long fantasy sports into a major business by hosting leagues, with contests that stretch out over months.

Different flavors of fantasy sports have sprouted up, with daily fantasy sports growing rapidly over the last two years, fueled partly by the instant gratification they provide players who can win money daily. Entry fees for contests range from 25 cents to $1,000, and total prize pools range from $54 to $100,000, with some tournaments offering pots of $1 million or more.

Eilers Research, which studies the industry, estimates that daily games will generate around $2.6 billion in entry fees this year and grow 41 percent annually, reaching $14.4 billion in 2020. Like other companies in the industry, Yahoo will keep about 10 percent of the fees as revenue and distribute the rest as winnings.

If Yahoo got just a slice of that, its profits could mount quickly. Yahoo said tens of millions of people already play Yahoo Fantasy Sports, spending an average of 500 minutes a month at the site, and many of those people have been playing daily games elsewhere.

In addition to revenue from entry fees, Yahoo might sell sponsorships or ads around the contests.

Yahoo has been hosting fantasy sports for over 16 years, and it operates a leading sports news site. Last month, Yahoo said it had struck an exclusive deal with the N.F.L. to host the first free, live global webcast of a regular season game, between the Buffalo Bills and Jacksonville Jaguars in October.

For now, Yahoo is offering the daily fantasy games only in the United States. Players can play on desktop computers, a mobile website or an iPhone app.

The company is initially offering $6,500 cash prizes in some games that are free to enter. It is also guaranteeing to pay prizes in some games, even if too few players pay the entry fee to cover the pot.

Kathy Savitt, Yahoo’s chief marketing officer, said that adding daily fantasy games was a logical extension of the company’s longstanding commitment to serving sports fans.

“We try to use the sports fans as a compass,” she said. “We’re focused on what do sports fans want and how do we delight them.”

Marissa Mayer, Yahoo’s chief executive, had hinted in April that she was planning an expansion into daily play.

“We believe this is an area where Yahoo can and should compete,” Ms. Mayer told investors in a conference call regarding the financial results of the company, which is based in Sunnyvale, Calif.

FanDuel and DraftKings, which dominate the daily sports niche, have drawn the interest of big investors. FanDuel, the market leader, has raised $88 million from investors like Comcast, NBC, KKR and Shamrock Ventures. DraftKings has raised about $76 million from investors like Atlas Venture and Redpoint Ventures.

The N.B.A. has a stake in FanDuel, and the site has signed exclusive multiyear deals with 13 basketball teams and CBS Sports. Major League Baseball has thrown in with DraftKings, which now has an exclusive deal with ESPN.

Both companies have been valued at $1 billion, though neither has turned a profit. And both have pursued high-profile sponsorships: Floyd Mayweather wore a FanDuel logo on his trunks in May when he defeated Manny Pacquiao. Last month, DraftKings sponsored the Belmont Stakes, where American Pharoah became the first Triple Crown winner in 37 years.

“Last year, the two combined to spend $100 million,” said Adam Krejcik, a managing director at Eilers Research. “This year, each will spend that amount on marketing and advertising. They are spending absolutely crazy.”

Michael Rathburn, who tracks the industry for Rotowire.com, said Yahoo’s entry into daily games would attract new players to the market. “Its existing base is massive, and Yahoo is making it easy for them to play daily,” he said. “It isn’t like people are going to abandon DraftKings and FanDuel. They just have another outlet.”

Fantasy sports place a premium on data, and technological and statistical advances have made a nearly infinite amount of information available instantly and for sale.

“The leagues are poised to profit from daily fantasy in so many ways,” said Daniel L. Wallach, a sports and gambling lawyer at Becker & Poliakoff in Fort Lauderdale, Fla. “They can sell their data to fans, sell more advertising and signage in and out of their arenas and command more for television rights.”

[COZ]

I'm surprised the horse-racing industry isn't whining and actively opposing the rise of DFS since they continually oppose any forms of gaming action anywhere that they feel will compete with them since it is the horse racing industry's birthright to have a monopoly on all wagering. The free pass from competition the horse racing industry has received from legislators for decades is a joke. I hope this is a step closer toward legalizing sports wagering throughout the country.

COZ

[GetALife]

I'm surprised the horse-racing industry isn't whining and actively opposing the rise of DFS since they continually oppose any forms of gaming action anywhere that they feel will compete with them since it is the horse racing industry's birthright to have a monopoly on all wagering. The free pass from competition the horse racing industry has received from legislators for decades is a joke. I hope this is a step closer toward legalizing sports wagering throughout the country.

COZ

Nascar and horse racing..........ring around the rosy. I can't do either. Bores me!

[Greg Ambrosius]

Fanduel just upped the ante a bit in the very competitive DFS market this week by raising another $275 million in capital. This will allow Fanduel to heavily market their games during the upcoming fantasy football season. The market is definitely getting interesting. See below:

http://recode.net/2015/07/13/fanduel-ra ... valuation/

FanDuel Raises $275 Million, Births Unicorn
By Kurt Wagner
@KurtWagner8

July 13, 2015, 9:00 PM PDT

FanDuel, one of the two major players in the budding daily fantasy sports industry, has raised $275 million in new venture funding. The new round values the company “well north” of $1 billion, according to a source.

The round was led by KKR, and included new investors Google Capital and Time Warner Investments. Existing investors Shamrock Capital, NBC Sports Ventures, Comcast Ventures, Bullpen Capital, Pentech Ventures and Piton Capital were also involved.

FanDuel, which still isn’t profitable, has now raised $363 million since 2009. The company has a fast-growing revenue stream, though, and made nearly twice as much as rival DraftKings in 2014. It brought in more than $57 million last year by taking a small percentage of entrance fees that people submit to compete in daily fantasy sports contests. It’s just spending much more — primarily on advertising — than it’s bringing in.

And even now the bulk of FanDuel’s money has been earmarked for marketing; bringing on new users is the company’s top priority with the new funding, according to CEO Nigel Eccles.

FanDuel and rival DraftKings are in a heated race to scoop up fantasy sports enthusiasts for their respective sites, and even Yahoo is now jumping into the fray with its own fantasy sports service. FanDuel and DraftKings are spending hundreds of thousands, if not millions of dollars to partner with sports leagues and teams in an effort to build out their brands. Those deal are pricey, but what’s more expensive are the in-stadium advertising and media deals that come along with those partnerships.

DraftKings, for example, has committed hundreds of millions of dollars in ad spend to be the exclusive daily fantasy partner for all ESPN properties beginning in 2016, a deal that will block FanDuel away from advertising to ESPN’s audience, but at a hefty cost.

FanDuel will also use the money to build out new products and grow its workforce. It recently hired nearly all of Zynga’s defunct sports gaming division, and plans to add another 40-50 employees by the end of the year. FanDuel also recently hired away Yahoo’s senior director of fantasy sports Cliff Ma.

The money comes at a prime time for FanDuel. The NFL season — which is the company’s busiest quarter — is just a few months away. (It has partnerships with 16 different NFL teams.) Perhaps even more important is that with the addition of Yahoo’s daily fantasy offering, FanDuel will now have to fend off more than just DraftKings for user acquisition

The money should make for some very intriguing competition.

[Greg Ambrosius]

From SportsBusiness Daily today, showing how the upcoming football season is going to be the most competitive ever in the DFS space:

DraftKings Expects To Bring Fox Sports On Board As Investor
DraftKings as early as today "expects to add Fox Sports and other investors to its portfolio, largely replacing" Disney's $200M investment in the brand. Fox Sports would be "another elite sports investor in daily fantasy." The NBA and NBC Sports both own part of FanDuel, while MLB has a stake in DraftKings.

[Cocktails and Dreams]

Going to be interesting. Not sure they have the correct business models. I would be very concerned about some things they do if I were an investor. Going to be some new competition coming, with different ideas. Looking forward to seeing how the big guns react.