Earlier this week a group of representatives in Pennsylvania put together a bill that would allow casinos in the state the ability to offer daily fantasy sports to casino patrons. The licensing fee would be $50,000 and the government would take 5% of the tournament gross revenue. It's assumed the casino would take out a portion for themselves too. This follows New Jersey announcing last year that Monmouth Park would be offering daily fantasy sports and the announcement by several other states that their racetracks and casinos are looking at offering fantasy sports as well.

Fantasy sports is currently legal because of an exemption it was given in the UIGEA and two sites, Fan Duel and DraftKings have taken advantage of the vagueness of the law to offer daily fantasy sports where the results are decided on the same day and the number of players runs from 2 to several thousand. Fantasy sports bettors pick from a roster of players in the same sport (which occurs as long as there are 2 games) and also from sports like golf and most recently auto racing. The key is to choose a roster that fits within a set salary cap. While fantasy sports is legal because it apparently is a game of skill rather than chance, almost everyone in the industry acknowledges that the nature of daily fantasy sports makes it just another form of sports gambling and in truth it probably requires less skill than picking a game against a point spread.

The obvious question that has to be asked is why fantasy sports bettors would bother to wager at the casino or racetrack on daily fantasy sports.

Currently only 5 states don't allow fantasy sports, Arizona, Iowa, Louisiana, Montana and Washington and Louisiana Representative Joe Lopinto has a bill on the table that if passed would allow for fantasy sports betting in that state as well. But, if bettors want to play daily fantasy sports there is nothing precluding them from doing so at FanDuel or DraftKings, where they can make their picks at home, at work or wherever is convenient and watch their players perform in televised games. The roster of players is chosen online and one would assume the same would occur in casinos or racetracks at specially designated computer terminals. And as for payouts one would have to assume that they would be substantially lower at casinos or racetracks because of sheer volume. FanDuel and DraftKings have a potential pool of millions from citizens over 21 years of age in 45 states while the casinos and racetracks would only have a pool of whoever is currently in the facility at the time. And one has to wonder if head to head contests or small leagues would be feasible in most casinos or racetracks due to lack of volume.

I actually asked a colleague who works as a sportsbook manager in Las Vegas if he could understand the appeal of offering the product at a casino or racetrack and he said he could:

"It's a matter of being able to watch the games as a group and cheer on your team (or in the case of fantasy sports, roster of players) with a group of people. It's the social aspect that's important. That's predominantly why thousands of people flock to Vegas for the Super Bowl or the March Madness final game. They want to enjoy it with other fans and they love the atmosphere of being around other gamblers. Also if the casinos and tracks offer rooms like we do at our sportsbook there will be hundreds of TV sets all showing different games so one could easily follow the games they are interested in all at once."

Asked if his sportsbook would ever be interested in offering fantasy sports betting he replied:

"I would never say never but in Vegas we can offer the real deal. People come to Vegas to bet on games legally and you could never replace betting on the spread in the Super Bowl with fantasy sports. It just isn't the same. While fantasy sports is better than nothing, I believe in the end most gamblers want to bet on the success of a team, not a roster of players." The sportsbook operator asked me not to mention the casino he works at since the opinions are solely his and he didn't want it to appear that he was talking for the casino as a whole.

Of course while this manager's opinion is important the people that matter most are fantasy sports bettors themselves so I talked on Skype with my friend Kevin from Rochester that I mentioned in a previous article about fantasy sports and he thought the idea was somewhat ridiculous:

"Hmm.. let me see. I can sit in uncomfortable seats at a casino and watch the games on small TV sets, play into small pools and pay both the government and the casino a premium for the privilege or I can play at FanDuel, bet into games that I want to with a fairly low commission and watch live streaming on my computer or TV in the comfort of my own home. This is a tough decision . . . LoL."

Kevin did however acknowledge the relevance of the social aspect related to watching games but says he does that already. "During March Madness a group of my friends got together, we all submitted our rosters to FanDuel and we watched four different games at a time on TV sets that were streaming different feeds. I had 2 TV sets in my house and my friends brought one each. We drank beer, ate nachos and chicken wings and cheered as our players scored points or made assists or rebounds. And for some fun we made side bets with each other on whether players would make their free throws. It was great. But I guess if you have no friends, a casino is an option."

Kevin also pointed out that while he does play head to head matchups or small leagues on the fantasy sports sites, he suggests that one can do that with friends and avoid paying commission altogether by just picking players and using the scoring on one of the fantasy sites as the official score sheets. But he's also leery to play head to head for large amounts against friends.

"If I'm in a head to head game with a $1,000 buy in I'll play at FanDuel rather than against a friend. I'd feel guilty taking a dime from someone I like, but it doesn't faze me to take the money from someone in Tallahassee that I never met. And at FanDuel I've learned to spot fish that I always play against if the spot is open. I doubt that would ever be a viable option at a casino."

There is also another reason that casinos and racetracks could be offering fantasy sports and that's to push the federal government to drop or amend PASPA. There is some belief that if fantasy sports really took off and that the legitimacy of games weren't compromised despite the success of fantasy sports that leagues would realize their objections weren't realistic and would back off their stance against legal sports betting. The NBA has already begun moving towards accepting betting on their sports, the NHL doesn't seem to be far behind and no one is sure about Major League Baseball. But in all three cases they have accepted partnerships with either FanDuel or DraftKings. And even with the NFL, some of the teams have agreed to sponsorships from the two sites.

When sports betting was allowed in the UK in 1961, it was for that exact reason. The government acknowledged that betting on the sports was already taking place in other forms so it made no sense for the leagues and government not to benefit from the wagering themselves. So if people are already wagering large amounts on fantasy sports at Monmouth Park, for example, then why shouldn't Monmouth Park allow wagering on point spreads as well? If the two are related, as almost all industry pundits agree, then the opposition to one and approval of the other seems illogical. If that is indeed the case, then the government could be looking at offering daily fantasy sports to make the case to the courts and leagues that their concerns are unfounded.

There's no question that daily fantasy sports is taking off in leaps and bounds and it's somewhat comforting that bettors have a legal way to wager on sports in most states without concerns about payment options or wondering whether the DoJ is looking over their shoulders. But it is very doubtful that the success of FanDuel or DraftKings could be emulated in a small individual casino or racetrack setting. The question is will casinos in Pennsylvania be willing to fork out $50,000 for a license to see if that is indeed true?

I suppose we'll find out . . .

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