Sports Illustrated To Enter Daily Games Space

[Greg Ambrosius]

Not surprisingly, we are seeing our first major publisher enter the Daily Fantasy Sports space and doing it in a big way. The fact that the term "bet" is used in this promotional release is surprising. Are we getting too close to the line with these DFS games?

Check this out and let's hear your thoughts on this:

Sports Illustrated Prepares Its First Fantasy Sports App, Complete With Betting
Cuts of Wagers Could Open a New Revenue Stream for the Magazine

By Michael Sebastian<http://adage.com/author/michael-sebastian/5066>. Published on June 23, 2014. 0

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[The new Sports Illustrated mobile site, which debuts Tuesday.]The new Sports Illustrated mobile site, which debuts Tuesday.


Sports Illustrated plans to roll out its first fantasy sports app in late June or early July, an effort to tap the billions of dollars that consumers spend on fantasy sports annually. The app, Fan Nation, will allow users to take part in the fastest growing segment of fantasy sports, daily play, where participants select a new team each time they play and then square off against a friend or random competitor.

The first game offered through the app is "Baseball Throwdown" and involves Major League Baseball players.Sports Illustrated<http://adage.com/directory/sports-illustrated/7095> plans to offer similar games with players from the NFL, NHL<http://adage.com/directory/nhl/6784> and NBA.

Executives at Sports Illustrated, part of Time Inc., are hoping to bring on sponsors for the app, but it also offers the magazine a potentially new revenue stream.

The app lets users bet money that they will win their match, although Sports Illustrated labels the bet an "entry fee," and pays winners their money back plus their opponent's bet minus a "contest management fee." A successful $5 wager, for instance, reaps $9 for the winner.

"Our audience wants to play fantasy sports," said Jim DeLorenzo, VP-general manager of Sports Illustrated Digital. "The mandate is to make the experience so easy that even my dad could use it."

Thirteen percent of American adults take part in fantasy sports, according to the Fantasy Sports Trade Association. And it's big business in the U.S., where participants spent $3.38 billion on products, services and entry fees in 2012. Daily play is fueling much of the industry's growth.

"It's gotten more investment in the past two years than in the history of fantasy sports combined," Paul Charchian, the fantasy sports association's president,told Bloomberg<http://www.bloomberg.com/news/2014-01-0 ... ector.html> in January.

For Sports Illustrated, the app is part of a broader digital push beginning Tuesday with the introduction of a redesigned desktop and mobile site and followed later in the week with the rollout of the streaming video network 120 Sports.

The new SI.com will lean heavily on photography and video, with a mix of pure text headlines and the image-driven tiles that are en vogue in web publishing lately. It's also designed to be "mobile first," another popular mantra among publishers as mobile use grows quickly.


Sports Illustrated has brought on three new advertisers for the site: Black Rock, Canon<http://adage.com/directory/canon/4130> and New Balance. Brendan Ripp, Sports Illustrated's publisher, is planning to pitch the new site to other brand marketers and agencies in late July. "We want to go out and show off the site's capabilities," Mr. Ripp said. "But we also want to do a lot of listening to learn how brands want to work with us."

The magazine has also hired about 20 editorial staffers in the last six months in an effort to double the amount of web content it publishes, according to Sports Illustrated Editor Paul Fichtenbaum. Eighteen months ago, Sports Illustrated melded its web and print staff into one, a move that has "energized staff," Mr. Fichtenbaum said.
[The new Sports Illustrated website.]The new Sports Illustrated website.


Other Time Inc. titles such as Time and Fortune have hired additional editorial staffers to publish more content to their own newly redesigned websites. At the same time, however, Time Inc. has warned investors that it might need to lay off staff . People magazine, which is Time Inc.'s top revenue driver, shed about a dozen staffers earlier this month<http://adage.com/article/media/people-m ... en/293516/> through layoffs and buyouts.

Earlier February, Time Inc. restructured, resulting in almost 500 job losses<http://adage.com/article/media/time-lay ... in/291459/>.

Sports Illustrated is one of Time Inc.'s best known titles and has historically been among the top five or six revenue drivers at Time Inc. But its print fortunes have diminished along with those of other weeklies.

Print ad pages at Sports Illustrated are down nearly 8% through the week of June 23 compared with the same period last year, according to Media Industry Newsletter, though the magazine has published one fewer issue this year. Pages fell 6% in 2013.

So it's looking to the digital space to spur revenue growth, a key strategy for Time Inc., which was spun off from parent Time Warner earlier this month to become the only pure-play magazine company to trade publicly on the New York Stock Exchange.

Sports Illustrated attracted nearly 20 million unique visitors to its desktop and mobile sites in May, a 49% boost compared with May 2013. By comparison, ESPN.com drew 68 million unique visitors, Yahoo Sports-NBC Sports Network got 56.3 million and Bleacher Report-Turner Sports Network attracted 55.4 million.

[Captain Hook]

I read this earlier in the day but seeing it here my first question was "Is their app/game subject to the same regulations as sites on the internet"?

If not then those in the banned states could play in the SI contests
While if there is still a restriction couldn't someone in WA or elsewhere get a cell phone with a CA number and be able to play in the contests?

[Greg Ambrosius]

And on the same day, sports betting in New Jersey is denied again:

The U.S. Supreme Court "has allowed a ban on sports betting in New Jersey to remain in place," as justices today declined to hear the case. That decision will let stand a lower court ruling that said that the state "couldn't allow sports betting because it conflicts with a 22-year-old federal law permitting the practice in only four states." However, state Sen. Raymond Lesniak, who sponsored the original legislation, "vowed to keep battling." Lesniak said that he "plans to introduce a bill today to repeal all laws prohibiting sports betting in the state"

What a crazy America we live in!!

[Greg Ambrosius]

I read this earlier in the day but seeing it here my first question was "Is their app/game subject to the same regulations as sites on the internet"?

If not then those in the banned states could play in the SI contests
While if there is still a restriction couldn't someone in WA or elsewhere get a cell phone with a CA number and be able to play in the contests?

Not every game operator is exempting participants from the six states, so you'll have to see what they do. I don't think it's the mechanism used to sign up for the game, it's providing your contact details and payment method. They'll need to know where to send your winnings and your tax info, etc., just like any other game operator. But maybe they won't exempt those states; time will tell.

[Rainiers]

Not surprisingly, we are seeing our first major publisher enter the Daily Fantasy Sports space and doing it in a big way. The fact that the term "bet" is used in this promotional release is surprising. Are we getting too close to the line with these DFS games?

Oh yeah, we are getting too close to the line. When and if the legal backlash comes, I worry that it may negatively impact the legal exemptions that season-long fantasy sports currently enjoy.

Examples exist to fuel the confusion to what is a wager and what is not. I can go to my local horse track and place a "pick-six" wager, selecting the winners of the first six races. I can go on line with DFS and place an "entrance fee" on those nine baseball players whom I feel will do best at their position that day. How can anybody differentiate between the two actions? I'm no lawyer, but common sense suggests that a Judge would have difficulty differentiating between the two activities. It would be hard to argue the difference, since there is no in-game strategy once the horses/players are selected. (Their is a salary cap in DFS games, but often that will not restrict you in being able to pick the best possible team.)

In any case, if a ruling comes down against DFS, I'm hoping it doesn't create collateral damage to ventures like the NFBC.

[Rainiers]

I hadn't seen this New York Times article when it first came out a few months back. It's a great summary of the growing DFS industry and it's somewhat precarious situation in our legal system. I stumbled on it this morning and recommend it highly if you are interested in the topic...

http://www.nytimes.com/2013/03/12/sport ... d=all&_r=0

[TOXIC ASSETS]

With 17 trillion in debt to deal with, millions of "undocumented workers" AKA ILLEGAL ALIANS, a widening wealth disparity, the disaster of Obamacare, Muslim Nazis that are taking over Iraq, and on and on........ you would think that the federal government would have more pressing issues than worrying about anything having to do with fantasy sports.

[COZ]

With 17 trillion in debt to deal with, millions of "undocumented workers" AKA ILLEGAL ALIANS, a widening wealth disparity, the disaster of Obamacare, Muslim Nazis that are taking over Iraq, and on and on........ you would think that the federal government would have more pressing issues than worrying about anything having to do with fantasy sports.

Ha. Nicely played, sir!

COZ