Underdog Fantasy Confront DraftKings and FanDuel over Market Dominance
LISTEN TO THIS ARTICLE:In the wake of the repeal of the Professional and Amateur Sports Protection Act (PASPA) in 2018, a wave of sports betting expansion swept across the United States.
Simultaneously, the realm of daily fantasy sports (DFS), also known as fantasy sports contests, was already a thriving phenomenon in the country. As sports enthusiasts embraced this innovative form of engagement, a fiercely competitive market emerged, mirroring the dynamism seen in the sports betting sector.
A Clash against DraftKings & FanDuel
Underdog Fantasy, a rapidly growing sports company, has emerged as a prominent player in the US market. Established in 2020 by a team of industry veterans, the company continues to make strides, delivering unparalleled experiences to sports aficionados. However, Underdog's journey has not been without challenges, as indicated in a recent letter penned by its co-CEO and founder, Jeremy Levine.
Levine candidly addressed the company's clients, highlighting the formidable competition posed by sports betting giants DraftKings and FanDuel. He asserted that through strategic lobbying efforts, these two corporations were instrumental in shaping sports betting legislation that inherently hindered the entry of competitors, innovators, and emerging companies into the sector. Levine contended that their influence led to the establishment of a near duopoly model, where DraftKings and FanDuel collectively dominated around 80% of the regulated US sports betting market.
When the Supreme Court later permitted states to legalize sports betting, DraftKings, FanDuel, and their lobbyists went to work. But this time they wrote laws designed to make it hard for innovators to break into the brand-new sports betting industry. The strategy worked and they had a near instant monopoly, capturing nearly 80% of the US sports betting market.
DraftKings and FanDuel want to prevent you from playing the fantasy sports you love. They want to quash competition in fantasy and stop innovation, and potential rivals, in sports betting. Unable to innovate with new sports games, FanDuel and DraftKings are trying to ensure fantasy sports are limited to a very narrow category of games.
Underdog’s CEO Counters DraftKings and FanDuel
Levine also criticized DraftKings and FanDuel for attempting to discredit their competitors, including those venturing into the fantasy sports sector, by labeling their fantasy sports contests as illegal. Despite their efforts, Levine noted that the giants' narrative was faltering in the face of gaming regulators, as it contradicted the existing framework of fantasy sports they had actively participated in crafting.
Addressing the ongoing battle, Levine reaffirmed Underdog's commitment to providing sports enthusiasts with innovative DFS solutions, aiming to enhance their engagement without the need for traditional sportsbook wagering. He underlined Underdog's dedication to sports fans, vowing to continue delivering groundbreaking experiences that resonate with their passions.
Levine concluded on an optimistic note, expressing confidence in Underdog's ability to prevail in the ongoing competition and offer fresh thrills and experiences to diverse sports fans across the nation. As the company remains steadfast in its mission to redefine fantasy sports, it seeks to carve out its niche in a market that has been significantly influenced by the dominance of its larger rivals.
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