Barely two years ago, the concept of a daily fantasy sports website was virtually unknown, and probably seemed like an incomplete business model to industry experts. In 2014, the scene has changed dramatically, with the emergence of two powerhouse daily fantasy sites in particular. DraftKings and FanDuel have moved aggressively to the top of the bourgeoning market. Now, they appear to be locked in competition not merely for users, but for also a far higher profile target: Partnerships with professional teams and leagues themselves.
Indeed, just since Monday, DraftKings concluded a deal to become the official partner of the NHL, and FanDuel reciprocated with a similar deal with the NBA. It speaks to the hotly contested nature of this partnership arms race, and how this is such a fascinating time in the daily fantasy sports market. It’s the beginning of an era, and the initial leaders in the field are scrambling to claim the open opportunities. Here’s a quick breakdown of the 2014 head-to-head between DraftKings and FanDuel so far:
March 16: FanDuel partners with the World Series of Fighting.
March 24: DraftKings partners with Major League Baseball, becoming the “Official Mini Fantasy Game of MLB.com.”
May 28: DraftKings signs with the World Series of Poker as an official sponsors, and exclusive fantasy sports partner.
August 19: FanDuel completes a deal to partner with the Orlando Magic.
August 24: Securing another deal with an NBA team, FanDuel signs to partner with the Brooklyn Nets. They would also conclude individual deals with the Dallas Mavericks, the Chicago Bulls, and the New York Knicks.
October 16: DraftKings responds to the FanDuel NBA gains by becoming the first daily fantasy site to sign a partnership with an NFL team, inking a deal with the New England Patriots.
November 10: DraftKings signs another deal with an entire American sports league, agreeing to be the NHL’s official in a four-year deal.
November 12: After losing out on two leagues, FanDuel strikes back, signing it’s partnership with the NBA.
Clearly, 2014 has been a pivotal year in the history of daily fantasy sports, and will be looked back on as the time when the business gained an enormous amount of mainstream legitimacy. This is particularly crucial for DraftKings and FanDuel, since their product has always erroneously been lumped in with online gambling. Of course, even a quick Google search reveals that fantasy sports has been separated from gambling legally by the Unlawful Internet Gambling Enforcement Act.
Still, the force that will drive casual fans and fantasy players to engage with daily fantasy sites is the legitimacy that an official league or team partnership adds.
And keep in mind, two major sports leagues are still unclaimed, providing an exciting next chapter in the DraftKings vs. FanDuel arms race. The NFL, with all of its billions, has (as a league) not committed to an official daily fantasy site. And neither has the English Premier League.
Both of those leagues will be hotly contested. In the early going, DraftKings’ partnership with the Patriots suggests an inside track on that front, but the race is still very much in the balance.
