By Brant James
TAMPA – As legal sports betting spreads following the repeal of the Professional and Amateur Sports Protection Act in May of last year, the Fantasy Sports Trade Associationon Tuesday announced it will expand its mission to include an industry that competes for nearly the same customers.
DFS stakeholders get a firewall and a chance for collaborative growth, while the sports betting industry inherits experience navigating the type of legislative tussles it will face in bringing wagering to more states.
By rebranding in April as the Fantasy Sports and Gaming Association, president Paul Charchian said the organization will fulfill a mandate of “adapt or die” that became apparent to the group’s leadership following the Supreme Court decision in May.
Growth of Legal Sports Betting Threatened DFS
Charles Gillespie, founder and CEO of Gambling.com Group, and an advisor to the FTSA, agreed the partnership was crucial for the fantasy sports industry.
“The growth rates in sports betting are remarkable and are basically going to continue to be remarkable for the foreseeable future, whereas fantasy is basically flat,” he told Gambling.com. “So, I think for the FSTA to kind of remain relevant, there’s been a push from the top to embrace sports betting because that’s where all the excitement and growth moving forward is likely to come from.”
There are incentives for the legal sports betting industry as its purveyors attempt to burnish the roster of eight states where sports betting is currently legal and in practice. More than two dozen states along with the District of Columbia are in some phase of introducing bills or implementing law.
“The sports betting industry has an enormous task in front of it to educate policy-makers and legislators across the United States on what this all means, and virtually all of these policy-makers don’t understand gambling. Why would they?,” Gillespie said. “And the FSTA is going to hopefully make a lot of progress in terms of educating the right people in the right places about how the industry works and then they can make intelligent decisions about how to tax it and regulate it and monitor it.
“But if that education effort doesn’t happen, then there’s simply no way the policy-makers will make the right decisions on how to regulate it. The fantasy world was actually fairly successful in passing state-based legislation. In 20 states it passed daily fantasy laws. That’s pretty good. If we get 20 states that pass intelligent sports betting law, then, boy, we’ve got an exciting couple of years ahead of us.”
FSTA Membership Embraced Alliance
In a presentation that opened the group’s winter meeting in Tampa on Tuesday, Charchian said polling revealed that 48 percent of fantasy players were already sports bettors and that 78 percent expected to do so at some point.
Although Charchian allayed concerns that the spread of legal sports betting would “cannibalize” DFS by noting that only 14 percent indicated they would play fantasy sports less when sports betting became legally available to them, he acknowledged their target demographics were “almost dead on” in makeup.
“It’s going to be a whole new world, so this is just sort of our way to take it on,” said FSTA chairman Peter Schoenke. “We have a lot of experiences as these states try to consider all this.”
Schoenke said it was beneficial to ally with the sports betting industry rather than continue as potential adversaries.
“That’s definitely true,” he said. “We want to be able to keep it so fantasy sports can continue to operate under the legal environment, but no one in the fantasy sports world was ever anti-sports betting. There’s a lot of shared common interest, and I think all of our people here are innovators and entrepreneurs. They wanted to see what we could do to go over that boundary and combine the two.
“There’s a lot of shared opportunity here.”
Schoenke said he considers DFS and sports betting different enough, with fantasy more based in competition among friends, for DFS to continue to thrive.
Schoenke hopes the non-profit organization founded in 1999 can take on a role and profile similar to that of the American Gaming Association.
The reception in the room full of vendors representing large and small companies was initially enthusiastic after Charchian went to great length to explain the methodology of the move and insist it was beyond good business and crucial for their collective prosperity. Eighty-three percent of FSTA membership had polled in favor of including sports betting interests.
“The day PASPA was repealed, the value of all our companies went up,” Charchian said.
FSTA Sees ‘Seismic Shift’ In Industry
In a letter to members, the FSTA board said the sports industry “is set for a seismic transformation with the growth of skill games, non-sports fantasy gaming, and the legal changes that have the U.S. poised for a rapid expansion of sports betting.”
The association tapped gambling industry experts and stakeholders for advice about a possible collaboration, including Gillespie, Matt Holt (President, U.S. Integrity), Dan Kustelski (Co-Founder and CEO, Chalkline Sports), Keith McDonnell (CEO, KMiGaming) and Brian Musburger (CEO, VSiN).
This article was originally published at https://www.gambling.com/news/adapt-or-die-fantasy-sports-expand-into-sports-betting-1771300