SBC News Voice of the Sports Betting Industry
A new study from Juniper Research has predicted that consumer spend on daily fantasy sports (DFS) will double from $2.6 billion in 2016 to $5.3 billion by 2021.
Juniper also anticipates that FanDuel and DraftKings, two companies that were referenced in the study and represent a combined 90% market share, will merge imminently to consolidate their dominance.
North America continues to dominate the industry with US regulatory loopholes denoting the activity a ‘game of skill,’ rather than gambling. In fact, more than 75% of the worldwide DFS market comes from North America, and about 50 million Americans played some form of fantasy sports in 2015.
However, given both FanDuel and DraftKings have already made an initial foray into the UK, West Europe is set to become the next major market over the coming five years. This is despite concerns over guaranteed prize pools and revenue constraints, as well as issues with professional players.
Research author Lauren Foye commented: “DraftKings and FanDuel have used aggressive marketing strategies that gave rise to accusations of false advertising and concerns with cost overruns. Both they and emerging players will need to quell suggestions that only 10% of ‘professional’ players win the monetary prizes on offer.”
The research claimed that concerns could be addressed through private leagues, where users compete with friends, essentially removing the issue surrounding pro-players. Meanwhile, providers will attract casual players playing for smaller prize pools, alleviating some of the concerns surrounding liquidity.
Juniper Research provides research and analytical services to the global hi-tech communications sector, providing consultancy, analyst reports and industry commentary.
