Interactive DAILY FANSTASY SPORTS
DraftKings And FanDuel: A Possible Merger?
The world of fantasy sports has recently been shaken by the rumour that FanDuel and DraftKings — the two leading daily fantasy sports companies — are in talks about a merger. Of course, there is still the question of whether it will even happen at all...
may indeed be willing to make the merger a reality.
Valery Bollier, CEO, Oulala Games
Te challenging reality of having very few options within their domestic market is most likely the reason for DraftKings and FanDuel’s desire to merge. Teaming up would make them a stronger force together in order to face such trying times.
However, both companies have significantly diverse corporate cultures where DraftKings evolved through acquisitions andFanDuel’s growth was more organic. FanDuel may have come long before DraftKings, however, if they are able to set aside their many differences, they
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Tis could potentially have a great impact on DFS, both on a domestic level as well as on an international one. When put together, FanDuel and DraftKings embody a rather substantial percentage of the US market. As a united force, they would be able to shape a significantly more efficient strategy to incorporate in their discussions and arguments against various American states.
As it stands, the international market is still at a very early stage and therefore, this looming merger does not spell good news since we must work on raising awareness regarding the sector, where competition is the ideal method. Both FanDuel and DraftKings have remarkable marketing budgets and we have witnessed the positive effects of their commercial war in the States. Tis further indicates that the merger would not bode well for the European and UK market.
Nonetheless, I remain sceptical that this merger will be approved due to the strict anti-trust laws in the USA. It is inevitable that many eyebrows will be raised when the two major companies within a sector, holding an impressive 90% of combined market share, begin to consider a merger.
Another critical reason against the merger is the New York legislature’s recent decision to pass a bill that will legalize and regulate the fantasy
sports industry. Tis may be the beginning of the end of the legal battle in acritically important federal state, ultimately annihilating the need for a merge.
It is not the first time that Draftkings and Fanduel have discussed a possible merger. Te legal battle in the USA has inevitably created a bridge between them and for the first time,such a subject became more than just an option. Te French poet Antoine de Saint-Exupéry, author of “Te Little Prince”, said that “if you want two people to be friends, punish them together”. Draftkings and FanDuel have been severely punished this past year and by sharing this difficulty together, they were inevitably drawn closer. However, Saint-Exupéry also stated that “if you want them to be enemies, reward them together”.
A simple look at the public reaction to the two companies indicates that New York’s decision is a key first step in obtaining the reward that theyboth dream about. If the poet is right, this bill could signal the end of a peaceful period between the two giants, promptly returning them to what they did best during these last few years; fierce competition.
Tis would, of course, be excellent news for our very young European industry. We need the DraftKings/FanDuel competition in our market to developincreased awareness towards our sector and attract more and more customers to play DFS. Tus, it is in our best interests to welcome them as two very separate entities.
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