In The Crosshairs
Florida is taking aim at daily fantasy sports companies it claims are operating illegally in the state, but the overarching question is, what is driving Florida's interest in DFS?
The Bulletin Board
NEWS: Florida drops the hammer on daily fantasy sports, but who is behind the crackdown?
NEWS: Kentucky mobile sports betting sites are set to go live on Thursday.
NEWS: Right on cue. After I criticized the state of responsible gambling, Kindbridge and BetMGM announced a new program that I absolutely love.
VIEWS: Following on from the previous story, I revisit a responsible gambling policy that I don’t feel will have a positive impact.
AROUND the WATERCOOLER: More on the situation unfolding in Florida.
STRAY THOUGHTS: Whatever happened to NFTs?
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Florida Sends Cease-and-Desist Letters to DFS Ops
The gambling world is very familiar with the Friday night news dump, and last week’s installment came from the state of Florida, which sent cease-and-desist letters to at least three fantasy sports operators, PrizePicks, Underdog Fantasy (a Straight to the Point sponsor), and Betr.
The letters (posted by Florida Regulatory Watch) read in part:
“Under Florida Law, betting or wagering on the results of skill, such as sports betting, including fantasy sports betting, is strictly prohibited and constitutes a felony offense unless such activity is otherwise exempted by statute.
“Accordingly, as Executive Director of the Florida Gaming Control Commission, I am hereby demanding you immediately cease and desist offering or accepting bets or wagers from residents of this state on the results of any contests of skill such as sports betting, including, but not limited to, bets or wagers made in connection with fantasy sports.”
Florida joins a growing list of states attempting to tighten rules around DFS.
The Florida C&D letters differ in that they do not specifically target Pick ‘Em games but encompass all daily fantasy sports. As Robert Linehan tweeted, John Lockwood, a Florida gaming attorney who represents Underdog Fantasy, said, "The Commission staff confirmed that the language in the letter broadly applies to all paid fantasy sports contests, and they are not aware of any paid fantasy sports company operating legally in Florida."
That raises the question, who is behind the crackdown? Is it the latest salvo in the feud with DraftKings and FanDuel? Was it the Seminole Tribe, which is expected to relaunch sports betting in the not-too-distant future? Or is this just a typical action by regulators and the AG office?
In a statement to Saturday Down South, PrizePicks pointed the finger at its high-profile competitors:
“… Over the past few years our larger competitors have intentionally spread misinformation to regulators across the country. We believe this anti-competitive smear campaign has driven inaccurate understandings of our contests and the laws governing them…”
For now, the three sites will continue to operate as they communicate with Florida regulators.
As Attorney Daniel Wallach tweeted, this could be yet another legal case for Florida “if the companies wish to challenge the cease-and-desist letters. That’s what happened in New York nearly eight years ago.”
Wallach went on to say the choice in Florida is binary: “Cease-and-desist OR seek declaratory relief from a state or federal court.”
I expressed my thoughts on this topic (the legality of certain DFS products) in a recent feature article you can read here.
There is a secondary story happening just under the surface, as the Florida Gaming Control Commission has gone through three chairs in a year - h/t Steve Brubaker.
Kentucky Mobile Sports Betting Launches Thursday
It’s mobile sports betting launch week in Kentucky.
Three weeks after the state’s retail sportsbooks opened their doors, seven online sportsbooks will launch on Thursday: Barstool Sportsbook (which will rebrand to ESPN Bet), Bet365, BetMGM, Caesars Sportsbook, DraftKings, Fanatics, and FanDuel.
An eighth operator, Circa Sports, has been approved but will launch at a later date, and startup Prime Sports (you can read my previous writeup on the company here) has also announced its intention to launch in Kentucky.
During a Friday press conference, Kentucky Gov. Andy Beshear announced that more than 60,000 online accounts were already pre-registered. And as Steve Bittenbender noted, “That's in addition to people who have already created accounts for some of the sportsbooks when they launched in neighboring states.”
That said, there are a lot of crossed fingers in the Bluegrass State. The state’s expansion into sports betting has become a political issue, with Gov. Beshear highlighting sports betting as a key component of his reelection campaign.
With that as the backdrop, the state has used a very accelerated launch timeline and is leaning heavily on a regulatory body that, as local press phrased it, “have 100 years of combined work experience in government and no experience in the gaming industry.”
The speed and lack of experience aren’t sitting well and could backfire if issues arise. As former Louisiana Gaming Control Board Chair Ronnie Jones put it in a LinkedIn post titled, Kentucky Sports Wagering—Ready, Fire, Aim! “You get one try and one try only at an initial launch and the crucial nascent weeks that follow. There’s a lot hanging in the balance. Get it right from the outset.”
The state’s retail betting launch went off without incident but online is a different animal. So, as I said, fingers crossed, Kentucky.
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A Responsible Gambling Program I Can Get Behind
Last week, I devoted my feature column to the current state of responsible gambling. I harshly criticized the overall discourse and questioned the efficacy of the policies.
Soon after publishing, BetMGM and Kindbrige Behavioral Health announced a new pilot program that speaks to the core principle of good RG policy, reducing harm.
Per the press release:
“The first-of-its-kind partnership will empower self-excluded players with direct access to comprehensive mental health assessments and group support services.
“The pilot program provides resources for players in need to schedule appointments immediately with specialized problem gambling outpatient treatment providers via telehealth services. As part of this partnership, gamblers who self-exclude from the BetMGM platform in Colorado will now be able to receive a complimentary mental health assessment and gain access to a range of peer support and educational groups designed to kickstart their recovery journey.”
The industry often criticizes friction points in the registration process, noting that customers are increasingly likely to drop off at each step in the process. Well, the same is true with responsible gambling/problem gambling. The MGM-Kindbridge pilot program removes a significant friction point, allowing customers who self-exclude to take the next step rather than self-excluding and then finding and scheduling an appointment on their own.
Good Intentions; Questionable Results
Another newish responsible gambling policy that I’m less enamored with was introduced in New Jersey way back in January.
As part of the Initiative, the DGE will work with online wagering companies to use technology to identify and work to address at-risk patrons. Operators of gambling platforms will now be required to analyze electronically maintained player data to determine whether a patron is showing signs of problem gambling behavior.
I love the idea of using data to identify problematic play. Where I grow skeptical is how problematic play is defined and what outreach follows - in this case, a phone call.
As I wrote back in February, “The program’s use of available data should be commended. That said, I have serious concerns about the intrusive nature of some of the outreach. It’s not a question of whether we should collect data. The question is, what do we do with that data?”
And contrary to the BetMGM-Kindbridge program, the NJ program adds a new friction point.
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Around the Watercooler
Social media conversations, rumors, and gossip.
More on the DFS situation in Florida from Steve Brubaker.
And as Marc Edelman tweeted, he has long advised avoiding Florida:
Stray Thoughts
Remember the NFT craze? That was fun. Unless you happened to purchase an NFT at peak market. I think Justin Bieber will be okay with a $1 million loss on a single “Bored Ape” NFT, but man, whether it’s Beanie Babies or NFTs, beware the hype train - unless you’re among the lucky few who make a quick buck by getting in early and getting out before the bubble bursts.