ESPN’s (DIS) fantasy business is booming, with all 15 games (i.e. football, basketball, baseball) reporting a YOY increase in usage and all but one seeing all-time highs for participation. The company’s 2016 pivot from individual game apps to a singular mobile application that housed all 15 games is the catalyst for the most recent results. Prior to the migration, ESPN allocated most of its resources to its football game, neglecting the other 14 sports; with a singular platform, the company has been able to provide users with its best product across all sports. It’s estimated that more than 20 million people have played ESPN fantasy games within the last 12 months, a figure that has doubled since 2013, with half the growth occurring within the last year.
Howie Long-Short: More than a dozen daily fantasy companies (i.e. FanDuel, DraftKings) registered to do business in the State of Maryland after Comptroller Peter Franchot issued the state’s first-ever regulations on fantasy operators, back in January. (Note: the state’s General Assembly has no interest in making recommendations on the legality of daily fantasy sports). They’re hoping that the consensus is wrong, but it’s widely expect that the SCOTUS is going to declare that the federal government cannot prohibit states from authorizing legalized sports gambling. That would be a kill shot to the DFS industry as they can’t compete with in-game betting; but with Maryland currently allowing DFS companies to operate with paying a fee (VA & PA are charging $50K/license), there is little reason for them not to pursue short-term profits.
Fan Marino: FanDuel CEO and co-founder Nigel Eccles is leaving the company and has announced his intentions to launch an esports venture. From the outside, it appears that Eccles is leaving the ship before it sinks, but that isn’t the case. Plans for his exit began late last year after the company agreed to merge with DraftKings and it was decided he would not be CEO of the joint company. Former CFO Matt King will be taking over as FanDuel CEO.
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