Fantasy sports under fire, including prominent FanDuel and Draft Ops sponsorships at Barclays Center
|At the Barclays Center, for an Islanders game|
A huge new advertising sector at professional sports facilities is under fire, especially in New York State, where yesterday Attorney General Eric Schneiderman issued a cease-and-desist order to "the two biggest daily fantasy sports companies, DraftKings and FanDuel, to stop accepting bets from New York residents, saying their games constituted illegal gambling under state law," as the New York Times reported.
“It is clear that DraftKings and FanDuel are the leaders of a massive, multibillion-dollar scheme intended to evade the law and fleece sports fans across the country,” Schneiderman stated. “Today we have sent a clear message: not in New York, and not on my watch.”
As the companies fight back, claiming to ESPN that these are games of skill, Schneiderman's decision will reverberate nationally, where New York joins seven states (plus the province of Quebec), where fantasy sports is banned and FanDuel is a sponsor of the Nets.
|Previous version of Draft Ops web site, omitting New York|
Oops. (FanDuel still hasn't changed its site.)
Draft Ops has a major presence at the Barclays Center, as shown in the photo above right, dominating the end of the hockey rink, advertising "Pick. Watch. Win."
(Some on Twitter wonder whether the DraftOps advertising will go down. A Forbes contributor observed, regarding FanDuel, "How the team [Nets] intends to deal with the logo of an illegal company placed throughout its arena remains to be seen.")
The new role of fantasy sports
Such advertising bolster's Schneiderman's conclusion that the current crop of fantasy sites profit mainly from the wagering, rather than, as traditional fantasy sites do, earn money from administrative fees and advertising.
|Current version of Draft Ops web site says New York|
residents are ineligible to play (click to enlarge)
Last July, Venues Today reported on the Barclays Center's three-year deal with Draft Ops:
For Barclays Center, the appeal of working with Draft Ops came with being used by the daily fantasy sports website as a launching pad for their brand.
“No different from many other brands we work with, the attractive piece here was they’re going to use us as a vehicle to really launch their brand or make a big play in New York,” said Mike Zavodsky, Barclays Center’s executive vice president of Global Partnerships. “We like working with brands that use us as a centerpiece of their portfolio in terms of activation.”
And the centerpiece of the partnership is the Draft Ops Ice Club, which will be located directly next to the rink on the west end for all New York Islanders' games. The space will include major branding, extending from the glass through the first five rows.
|Today's NY Times, click to enlarge|
This is big business. The Times reported that DraftKings "is valued at more than $1 billion and has the financial backing of Major League Baseball and the N.F.L. owners Robert K. Kraft of the Patriots and Jerry Jones of the Cowboys."
The Sporting News last month noted "29 of the NFL's 32 franchises signing advertising contracts with either FanDuel, DraftKings or Yahoo! Inc., [making] the league... the biggest business partner of daily fantasy sports." ESPN reported, "Although the major sports have anti-gambling policies, the National Hockey League, MLB and the NBA all took equity positions in daily fantasy. "
Last month, in Despite Industry Crisis, Fantasy Sports Leaders Pour On Ads, Times Sports Business reporter Richard Sandomir observed that the "get-rich commercial messages of the fantasy sports leaders DraftKings and FanDuel have inundated the airwaves as no advertising category has in recent memory."