Current research suggests that the daily fantasy sports industry will reach $5 billion by 2021.
Daily fantasy sports is quickly becoming a top entertainment option for gamblers online. Consumers love taking part in contests involving their favorite sports such as the NFL or NBA. The possibility of earning a cash payout makes the gaming option very enticing and keeps players coming back for more. Despite the industry having troubles late last year and into this year, it has been estimated that the industry will double by 2021 to over $5 billion revenue each year.
New Market Research
Juniper Research is a research company based in the United Kingdom who recently released their findings on the daily fantasy sports market. The group found that by the year 2021, the daily fantasy sports market will have reached $5.3 billion. Currently, the industry is worth around $2.6 billion.
The research was released just a few days after FanDuel and DraftKings announced they would be merging into one massive company. Rumors have been circulating for some time that the two would become one and now that they will, the merger will create a top DFS company that will be difficult to beat. The closest rival to the two companies is Yahoo, who dwarfs in comparison to what the two DFS operators are able to do.
Consider this. Just this past week, NFL Sunday totals for DraftKings and FanDuel reached the seven figure mark yet again by way of entry fees, prizes awarded and revenues earned. For Yahoo, the company was only able to see six figure buy-ins and prizes and only five figures for revenues.
Currently, North America has over 75% of the worldwide daily fantasy sports market. However, in time, other countries should grow drastically as DFS begins to take hold. In their research, Juniper stated that North America currently dominates the industry within the United States as regulatory loopholes denote the activity as a game of skill rather than one of gambling. Nonetheless, as several smaller players in operation globally as well as an initial foray into the UK by industry leaders, West Europe will become a major market in the next five years.
How it Stands in the US
Daily fantasy sports have been explicitly legalized within ten states in the US, such contests are being looked at by lawmakers in Washington D.C. The federal government is going to be looking at laws involving online gaming as well as sports betting by next year which could see something shape up either for against the industry.
Fantasy sports did earn a carve out from laws that have restrictions on online casino games so that does help. It has been found that as many as 50 million individuals in America played some type of fantasy sports game last year. When you consider Canada and the US in regards to fantasy sports, the industry is worth around $26 billion, with the industry still essentially in its infancy.
States seem to be opening up to the activity as they see the potential for earnings with the popularity of the contests. Players are logging online more and more for entertainment and they want to be able to gamble on DFS contests as well as casino and poker gaming. Fans of the activity are hoping that lawmakers will set DFS laws next year that will allow players to take part in the gaming activity without consequence. It will take some time, but it seems legislators are more open to the idea rather than trying to restrict players from taking part in daily fantasy sports contests such as those provided by DraftKings and FanDuel.