By Tyler Berry
The recent legal uproar about daily fantasy sports leagues DraftKings and FanDuel definitely got me thinking about the true merits behind it compared to direct, true sports gambling. The New York Attorney General has deemed the daily fantasy sites illegal in his state due to the fact that he believes they are, at their core, gambling.
At first, I was hesitant to agree. The overall set up of these DFS leagues is different from “regular” sports gambling done in Vegas or through an online sports book. However, after more thought, the two aren’t so different after all.
At its core, daily fantasy is exactly like your run of the mill sports betting. Frankly, it’s obvious and I felt a little dumb for not seeing the light from the beginning. For those unaware, daily fantasy leagues come in a few different forms. There’s a head-to-head format, much like your standard ESPN or NFL.com fantasy leagues. There are also larger tournaments, where anywhere from 20 to 200,000 or more players enter. Regardless of the format, you pay an entry fee. Fees start out at a quarter and often go up to thousands of dollars.
I have participated in every kind of DFS format there is and I also am a decently experience sports better. I use a lovely online sports book that pays out very quickly. What I’ve found through my DFS and sports book experiences is that DFS is much riskier than sports betting is. Why, you ask?
Look at it this way. Let’s say you enter a $5 NFL Sunday tournament on DraftKings. Currently, there is a contest with $35,000 in guaranteed prizes. Advertised as paying out the top 1600 players, there are 8,050 entry spots. Assuming that fills up to capacity, about 19.8 percent of entrants will win money. Not terrible odds, but not great. The major problem with this is that all but the top 250 winners get less than $14. Basically, if you’re between 251st and 1600th place, you make less than $9 in winnings plus your $5 entry fee back. It’s the major players, the professional DFS players if you will, that make the majority of the money. They are the ones who win the $6,000 first place prize or the $3,000 second place. Often times if you check after the contest is over, the winners of both of those prizes are the same person, a PRO.
Now, let’s look at betting through a sports book. Take one NFL game for week 11. The point spread for the Cowboys Dolphins game is -1 for Dallas. That means, to cover the spread, they need to win by 2. If that happens, betting $5 on this outcome would make you $4.55, about half the net winnings of what the majority of prizes for the DraftKings contest is. You might be thinking that DFS is obviously the way to go in this case. I’d argue that this is false. Here’s why:
Entering a DraftKings contest involves picking a roster of 9 NFL players from multiple positions and those 9 players cannot add up to more than your available salary of $50,000. Players are assigned a cost amount each week based on game performance, statistics, and weekly matchups. Better players equals higher cost. Basically, you’ll never be able to stack your team with 8 “sure thing” superstars and a top tier defense. You will have to take a risk on some players and there is never certainty that even your superstars will have the best performances of that week. Players could get hurt midway through a game or someone could be listed active but then not play a snap for the entire game. Think of it this way: if you had spent $9,000 of your $50,000 budget on Le’Veon Bell in week 8, you would have been very disappointed and probably ended up with a less than favorable result in the DFS league. Risk upon risk upon risk.
Back to betting through a sports book. The payout for a $5 bet may not be quite as lucrative as the DFS contest, but the chances of actually winning that payout are much higher. Betting on a Tony Romo and Dez led Cowboys team against a rough Dolphins team that has given up at least 26 points in 7 of 9 games is a pretty good way to go. Could the Dolphins win? Sure. The Redskins just scored 47 on the Saints. Anything is possible. However, if I was betting on a week 11 matchup, I would certainly place a few dollars on the Cowboys beating the Dolphins by 2. Look back at my Le’Veon injured in week 8 example. If you used Bell in DFS that week, you probably didn’t win much, if any, money. If you took that $5 and put it on the Vikings (-2) at Bears, you could have walked away with $4.55. Again, it’s not a glamorous winning, but it’s less risky.
Basically, this long-winded piece can be boiled down to one statement. When you bet on the outcome of one game, you are betting on one team (or two, depending on how you think about it). When you’re doing DFS, you’re betting on eight individuals and one defense on 2, 3, 4, 5, or even more teams. I’ll bet on one team’s play as a whole over the play of nine separate players/defense any day. The preference is your own, obviously, but at the end of the day, daily fantasy is gambling. Some, including myself, would argue that it’s an even riskier form of gambling. Don’t let any commercial fool you into thinking otherwise.
And as always, please gamble responsibly.