Awash in a flood of advertising and with new legal skirmishes popping up regularly, it’s easy to forget that these are exciting times for those involved in the fantasy sports industry. The numbers of both daily and traditional season-long fantasy users increase every year and have created the need for a variety of accompanying services.
As the chairman of the Fantasy Sports Trade Association and the president of RotoWire, Peter Schoenke has had a front-row seat and is well-acquainted with these facts. Schoenke spoke to DailyFantasyTalk this week about the effect daily fantasy has had on the industry, the push toward self-regulation and new products in RotoWire’s pipeline.
As we head into the busiest time of the year, what’s the biggest question hanging over the DFS industry?
Daily is going awesome, and everything is great. The $600 million question is with all the money they’ve raised, they’ve spent a lot on marketing, and will the users be there? Will they retain those users?
That’s a big question, not only for FanDuel and DraftKings and the other companies that are spending lots of marketing money, but for the industry as a whole. The rest of the industry is doing well with all of the ancillary services that the DFS format is helping create—whether that be news, information, podcasts or TV shows. There’s the software that you can use to track your teams. There’s a whole ecosystem that’s being developed around daily fantasy, and like I said, the big question is, is it going to live up to the expectations? Are they going to get the users this fall and are they going to retain them next year?
I’m optimistic. For each of the last three years you could’ve asked almost the exact same question and then when the numbers have come in it’s been even bigger and better. But obviously, the scale and the advertising is notched up a level that was far beyond my imagination, so we’ll see how it does.
Earlier this week FanDuel CEO Nigel Eccles talked about the desire for self-regulation in the fantasy industry. Is there anything on that front you can share with us?
We have the paid-entry contest operator charter for the FSTA. That’s currently what we’re operating under if you’re a member of the FSTA. Basically, it’s just best business practices. We’re constantly talking about how to improve that and when and if we have to change it, we’ll announce that, but behind the scenes we’re trying to figure out how to beef it up, make it better, improve it. Because, yeah, Nigel’s gist is correct. We want to self-regulate as much as possible. We think that’s the best way to go for our industry.
What sort of enforcement policies is there for companies that step beyond the bounds of that charter?
I think the main thing is that if somebody isn’t following all the standards and aren’t following good business practices, we wouldn’t want them to be in the FSTA. We want businesses that are with the FSTA to be good companies to do business with, and I think we have that reputation. So that’s the enforcement mechanism that we have right now, and we continue to have that debate, whether we should make that more robust. Maybe there will be some evolution on that, I’m not real sure. For now, that’s the main thing we do, and I think that (the chance to be associated with FSTA) is still reason enough for a lot of these companies to follow the best business practices.
You mentioned the ecosystem that’s sprung up around daily fantasy, and RotoWire is a big part of that. What’s next for you guys?
We’re just going to do the same things for new sports we do for the other sports. We have the lineup optimizer for college football, and we’ll have it for college basketball, and we’re going to keep doing enhancements to our tools. We’ve rolled out some enhancements that give you more data, added more sites other than FanDuel and DraftKings. We added a feature with RT Sports where you can submit your lineup directly from the optimizer, which saves a ton of time. I know I end up playing a lot more on RT Sports because it’s just so convenient. We’re going to have a mobile app with a lot of the same tools—optimizer, value report, all that—but you’ll be able to do it on the fly. We’ll have that for iOS hopefully in the next two weeks.
We’ve got a good base of tools and good relationships with the fantasy sites, we just need to continue to improve those features, because they’re very popular. We’ve had a lot of success. We generate over 25,000 unique lineups per night, per sport and that’s probably an old number. So it’s getting a lot of interest. These tools just save you a lot of time, and a lot of it isn’t even that dissimilar to the growth of season-long fantasy sports. It’s just with season-long, the growth of it was years, not months as it is in daily fantasy sports.
It’s just part of the ecosystem—somebody comes in with a great game, then somebody else comes along and creates the tools that makes it easier to play that game, like depth charts and projections and those things. That just speeds up your ability to make decisions so that you don’t have to do all the grunt work. I think that was one of the keys for DFS taking off. There was us and RotoGrinders and all the others out there fueling the whole ecosystem in a good, symbiotic way, and I think we’ll continue to figure out to do that.
How much of an uptick have you seen at RotoWire that can be attributed to the rise of DFS?
It used to be there was more a seasonal pattern, where once each season started, that was kind of the end of people hunting and pecking for content and they were kind of locked in for the season.
Daily has kind of changed that flow. People will get into daily basketball or baseball in midseason. Or maybe they start playing daily at the beginning of the season, but after a few weeks they realize they need more resources or better resources and they’ll find us.
It’s been a big benefit to our business, not only with the new tools that we’ve built, but also all the existing content that we have, which helps for daily and season-long. I think for all of us content sites, all the advertising the daily fantasy guys are doing is creating more fantasy users in general, and that’s good for content sites. The daily fantasy fans are going to consume more products like ours, which are for real diehards and really let you drill down.