Daily fantasy sports

Daily fantasy sports (DFS) are a subset of fantasy sport games. As with traditional fantasy sports games, players compete against others by building a team of professional athletes from a particular league or competition while remaining under a salary cap, and earn points based on the actual statistical performance of the players in real-world competitions. Daily fantasy sports are an accelerated variant of traditional fantasy sports that are conducted over short-term periods, such as a week or single day of competition, as opposed to those that are played across an entire season. Daily fantasy sports are typically structured in the form of paid competitions typically referred to as a "contest"; winners receive a share of a pre-determined pot funded by their entry fees. A portion of entry fee payments go to the provider as rake revenue.

In the United States, the daily fantasy sports industry is dominated by two competing services: the New York-based FanDuel, and the Boston-based DraftKings. Both companies were established as venture capital-backed startup companies, received funding from investment firms, sports broadcasters, leagues, and team owners, and became known for the aggressive marketing of their services. As of September 2015, both companies have an estimated value of at least $1 billion, and control 95% of the U.S. DFS market. The two primarily compete against smaller DFS services, such as Fantasy Aces and Yahoo! Sports. The popularity of the daily fantasy format has been credited to its convenience in comparison to season-length games, as well as the focus on major cash prizes in the promotion of these services. Daily fantasy has also been credited with helping to improve television viewership and engagement with sports.

Daily fantasy sports have faced notable legal challenges, including disputes over whether DFS constitutes gambling. Politicians and other critics have argued that due to their format, players are essentially making proposition wagers on the varying performance of individual athletes in specific games, and not managing the performance of their selections on a week-to-week basis. Proponents have defended DFS as being a game of skill, as the required familiarity with the players and teams, as well as salary cap management, rewards skilled players. Local laws have varying definitions of gambling games, such as whether a game's elements of chance are predominant over those or skill, or how much control the player has over the outcome of the game.

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