Daily Fantasy: You're Screwed, Because You're Supposed to Be

On sites like DraftKings and FanDuel, the sharks circle and the deck is stacked against you from the start. But hey, welcome to America

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Daily fantasy sites like FanDuel are projected to generate $2.5 billion in revenue by 2020. Andrew Harrer/Bloomberg/Getty

Perhaps you have heard of DraftKings and FanDuel, the two daily fantasy sports sites that now occupy every bit of digital advertising real estate not currently squatted by Flash ads for FACEBOOK OF SEX or SHOOT THE BENGHAZI TO WIN A FREE iPAD WITH HILLARY CLINTON'S EMAILS. And they've spread to TV. On reruns of House, the intro is now just Hugh Laurie looking at an MRI of a skull whose contents were replaced by the words DraftDuel. The twist is, the skull is yours. Sorry about the memories of your children.

If this alone were the shittiest thing about DraftDuel, dayenu, but of course it's not, because this is America, where billion-dollar arbitrage contests outfitted with a media wing can always become structurally predatory and awful. On Monday, the New York Times reported that a DraftKings employee won $350,000 using his site's proprietary information to make more informed plays on FanDuel. A FanDuel employee with access to insider data has also played on DraftKings, and both companies allowed employees to participate in daily fantasy while also working in it. We did it, folks: we found a way to gild that turd.

Daily fantasy would have been fine sucking on the merits. Despite assertions that it's a game of skill, it sure seems like organized gambling, in the sense that the exact margin between making it entertaining for you and wildly profitable for the house has already been determined. Like any casino game, it sits in the sweet spot between systemic extraction and sporadic dopamine rushes. You're screwed, because you're supposed to be – unless you're one of the skillful, lucky or sainted few to beat the odds, and if you didn't know you were one of them already, you're not going to become one.

How this works is easy. DraftDuel supply endless options, dazzling payout sums and high numbers of winners per game to make everything seem easy and tantalizing. I signed up for FanDuel and was promised fund-matching up to $200. Because I am cheap and deeply respect the Rolling Stone expense account, I chose to spend $10, but between the site not accepting my autofill credit card information, my having to find the card, then the site refusing to process the card at least a half a dozen times, the ten minute fund-matching window expired. (I'll concede that I probably screwed up some small detail, but have your cards at the ready if you sign up.)

Immediately after sign-up, the site bombards you with seemingly limitless options of contests to enter, many of which are closing in less than ten minutes!!!!!! Every contest has a name like "The $250K NFL Bomb" or the "NFL Monster" or the "Crushed Cojones $1 Million Baja Blast NFL Crunchcrotch" or "Cleatus Fisted Your Mom" or other names related to sports, money and incredible urgency. Each one requires an entry fee, from $2 to Too Much For A Citizen, and each pays out X amount, with Y number of players earning sums that could be as much or as little as Z! Once a contest is chosen, the rules are like season-long fantasy: you pick a QB, a running back, two wideouts, a tight end, a kicker and a defense, bearing in mind that each player has an estimated value and your total must be kept under a limit. You can't just max out the best players.

I didn't do well at all – although FanDuel gave me $0.38 in bonus money for participating, which James Harrison immediately made me give back – but then I didn't try terribly hard. I have the worst luck at gambling whenever I'd really like to brag about it and genuinely believe most people don't know fuck-all about why any one specific event happens on a football field until they're told. That said, it was incredibly easy to pick a fantasy roster, then copy and paste that roster to add it to another contest, make a few tweaks, then copy and paste that roster to another contest, make a few tweaks, etc. 

Basically, the DraftDuel sites are structured to make the motions of fantasy gambling endlessly repeatable and intuitively easy, while also making the compensation structure vague but excitingly immediate. It obviates the weekly slog of traditional fantasy where you're trapped with players who may suck, don't have the diplomatic skills to engineer trades that cripple opponents, or don't possess the will to maintain a team that started as a hobby and now feels like an obligation. Best of all, you can always pick the players you want. Do you never get Tom Brady in your regular fantasy league? You can pick him every time! Like Tom Brady, eh? HAVE ALL THE TOM BRADY IN THE WORLD!

But here's where the sticking points come in. Like the heady wild-west days of online hold 'em and blackjack, where you could deposit $100 and get an enormous casino bonus to play with (so long as you made a minimum number of bets), matching funds and any profits can be withheld until you meet withdrawal requirements. For Deadspin's Drew Magary, who gets off his ass to try things like this with more punctuality than I do, that meant having to earn a minimum profit threshold on DraftKings before cashing out. Because I didn't fund-match at FanDuel, I was able to get my $0.38 profit Paypal-ed tout de suite. I briefly considered waiting another day and paying another $10 to FanDuel, matching funds, then seeing what restrictions applied, but I have nobler aspirations, like trying to buy ephedra from a Hess Express.

In short, you're given money to play with because you are statistically likely to lose it back to the house. And the winnings that keep you going and provide a sense of reward to the average player are going to be no threat to that house. Consider this breakdown from Bloomberg Business

"Analysis from Rotogrinders conducted for Bloomberg shows that the top 100 ranked players enter 330 winning lineups per day, and the top 10 players combine to win an average of 873 times daily. The remaining field of approximately 20,000 players tracked by Rotogrinders wins just 13 times per day, on average."

That story focuses on the people most likely to win big: guys who use analytics software or design their own to spot inefficiencies in most-drafted players, then use other software to enter hundreds of contests per day. This is gambling in the same sense that an NSA supercomputer calculating the next prime number is sort of playing keno. And what complements the sheer volume of entries is arbitrage, finding potential breakout players who are statistically underdrafted relative to the overall field in contests. That option you have to draft Tom Brady every game can be a disadvantage when 1,000 other players are drafting him and the same stud RB. The player likely to become a difference maker is, say, a surprising Cleveland tight end who has a great day

Which is why DraftKings employees using in-house data to compete on FanDuel is not only fantastically shitty, but familiarly so. It amplifies what already sucks about the contest and just adds insider trading to it. If people running scripts or being able to create their own proprietary data pool already makes the contest structurally unfair, someone just taking the data that other gamblers voluntarily remit to sites like DraftDuel nauseatingly resembles Wall Street's normative levels of white-collar crime. In short, they were always going to fuck the little guy, but they cheated because winning an already rigged game the already easy way was somehow too damn hard. The Wall Street Journal reports that daily fantasy is projected to generate $2.5 billion in annual revenue by 2020. By 2028, someone illegally trading with it should be nominated Secretary of the Treasury.

That projected $2.5 billion matters, because numbers like that are what protect businesses from being filleted, fined and regulated by whatever passes for justice anymore. Comcast and NBC Sports are invested in FanDuel, and Fox Sports has invested in DraftKings, with ESPN signing an exclusive advertising contract with them. Major League Baseball and the NFL are also invested in DraftKings, as are Cowboys owner Jerry Jones and New England Patriots owner Robert Kraft. There are other contracts with the NHL and NBA. The number of actors and amount of capital behind them invested in the perpetuation of DraftDuel is the sort of brick-weight of cash that displaces and disperses a lot of hassle.

Yesterday, on ESPN's Outside the Lines, Bob Ley said that ESPN will no longer feature "sponsored elements" from DraftKings, but as Deadspin reported, that embargo is essentially bullshit, something that can disappear the moment the public flap dies down. And that's from Outside the Lines, ESPN's serious newsmagazine program that hovers over most ESPN programming with the miasmatic purgation of a silent elevator fart no one wants to claim. The rest of ESPN programming will likely do its best to make sure the flap dies down quickly, either by suffocating it of airtime or by denying any impact of its occurrence. The rest of the network has already so fully synergized with DraftKings that all fantasy football segments sound like preludes to how to maximize your DraftKings fantasy options. "The Talented Mr. Roto" is already DraftKings' man in Bristol.

So we'll resume the bombardment. The chromosomally congealed business ooze that is DraftDuel will, on nearly a billion dollars of capitalization and multi-network marketing integration, continue firebombing the tissue paper of the American attention span like Doolittle's Raiders. In two months, podcasts will be the awkward 90-second interstitial comments between 15-minute blocks of daily fantasy promotion. 

Because nothing crowds out or deafens scrutiny like loudness and repetition. This is how Planned Parenthood carves out a living selling baby brains for cash, Tim Tebow just wins ballgames and The Big Bang Theory is television's best sitcom. The DraftDuel experience really is the Number One fan experience, you can just sign up and start winning today, the deck is not already stacked in favor of the house, not further stacked in favor of script-kiddies with math degrees, not stacked yet further in favor of institutional manipulation, and everyone is going to make a lot of money. And those people are definitely not DraftKings, FanDuel, Jerry Jones, Robert Kraft, NBC/Comcast, Fox Sports and ESPN. Baby, it's you.

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