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Old 01-22-2015, 10:09 AM   #26
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Re: DFS Industry Discussion Thread (1st State law introduced today)

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Originally Posted by Zimmer4141 View Post
I think the biggest problem the industry is going to face is the fact that there is no limit to the amount of entries the best players and therefore closest to optimal lineups can run. When every game down to a $1 10 man SnG is infested by 3-4 of the top players, it will siphon the edge away from everybody else so rapidly that it'll end up being like the post-poker boom but happen way quicker imo.
exactly. limits on the # of entries you may play on a given slate are 100% needed for the game to have staying power. Otherwise fish get killed exponentially faster.
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Old 01-22-2015, 12:05 PM   #27
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Re: DFS Industry Discussion Thread (1st State law introduced today)

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Originally Posted by Zimmer4141 View Post
I think the biggest problem the industry is going to face is the fact that there is no limit to the amount of entries the best players and therefore closest to optimal lineups can run. When every game down to a $1 10 man SnG is infested by 3-4 of the top players, it will siphon the edge away from everybody else so rapidly that it'll end up being like the post-poker boom but happen way quicker imo.
The player pool for this is magnitudes greater than it ever was for poker. I don't think this is even a concern yet, and likely will never be if the product is good. This is why Party poker used to limit the site to 2 30/60 limit tables, and why at pokerstars you had to be pre-approved to play the "big" 100/200 limit game.

5/10 was going to kill the fish. then it was 10/25. Then 25/50 etc... And the fish still came and they didn't run out of money and life was good.

What killed the fish is lack of access. Sharks became cannibals. This player pool is nowhere near running dry, and those few who currently have an edge won't enjoy it for long.

It's like 2004 poker, but you are armed with the knowledge of today. Enjoy it, use it. in 2-3 years it'll be a different game. Embrace it while you can and don't worry, there is plenty of money. Fantasy sports is 50x more popular (in the US at least) than poker.

Eventually, they will have to cut that rake by 50%. That is what is going to kill the newbs, imo. But we are a long way off from that happening (unfortunately) until competition forces their hand.
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Old 01-22-2015, 01:30 PM   #28
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Re: DFS Industry Discussion Thread (1st State law introduced today)

Something else of note is that is relatively easy for a fish to become a shark. I mean let's face it, this game isn't very hard.
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Old 01-22-2015, 02:22 PM   #29
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Re: DFS Industry Discussion Thread (1st State law introduced today)

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Originally Posted by King Fish View Post
The player pool for this is magnitudes greater than it ever was for poker. I don't think this is even a concern yet, and likely will never be if the product is good. This is why Party poker used to limit the site to 2 30/60 limit tables, and why at pokerstars you had to be pre-approved to play the "big" 100/200 limit game.

5/10 was going to kill the fish. then it was 10/25. Then 25/50 etc... And the fish still came and they didn't run out of money and life was good.

What killed the fish is lack of access. Sharks became cannibals. This player pool is nowhere near running dry, and those few who currently have an edge won't enjoy it for long.

It's like 2004 poker, but you are armed with the knowledge of today. Enjoy it, use it. in 2-3 years it'll be a different game. Embrace it while you can and don't worry, there is plenty of money. Fantasy sports is 50x more popular (in the US at least) than poker.

Eventually, they will have to cut that rake by 50%. That is what is going to kill the newbs, imo. But we are a long way off from that happening (unfortunately) until competition forces their hand.
the sharks are already cannibals in DFS. The guys who do it full-time also, unsurprisingly, have the most data on who the terrible players are and are spending the most time refreshing the h2h lobbies and clicking on 3 mans etc. to find fish and take those games before they can be taken by other fish or bad regs who they stand a decent chance against.
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Old 01-22-2015, 02:35 PM   #30
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Re: DFS Industry Discussion Thread (1st State law introduced today)

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Originally Posted by Zimmer4141 View Post
I think the biggest problem the industry is going to face is the fact that there is no limit to the amount of entries the best players and therefore closest to optimal lineups can run.
There are limitations on FanDuel to how many LUs one can enter in a day. This limit may have to increase, but there is a limit. (500 entries)
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Old 01-22-2015, 02:37 PM   #31
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Re: DFS Industry Discussion Thread (1st State law introduced today)

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Eventually, they will have to cut that rake by 50%.
Considering there is not a single profitable DFS-only operator, this is a very long way off, if ever, going to happen.
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Old 01-22-2015, 02:39 PM   #32
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Re: DFS Industry Discussion Thread (1st State law introduced today)

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the sharks are already cannibals in DFS. The guys who do it full-time also, unsurprisingly, have the most data on who the terrible players are and are spending the most time refreshing the h2h lobbies and clicking on 3 mans etc. to find fish and take those games before they can be taken by other fish or bad regs who they stand a decent chance against.
What would happen, in your opinion, if all usernames were anonymous before contests were live? (Say this happened industry wide.)
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Old 01-22-2015, 03:18 PM   #33
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Re: DFS Industry Discussion Thread (1st State law introduced today)

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What would happen, in your opinion, if all usernames were anonymous before contests were live? (Say this happened industry wide.)
I suspect the best players still buy all the action their bankroll can handle. Bumhunters would probably migrate away from h2h matches which would be a good thing as far as keeping fish in the player pool longer.
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Old 01-22-2015, 03:30 PM   #34
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Re: DFS Industry Discussion Thread (1st State law introduced today)

1) Longer term, sites need to do a better job protecting their eco-system.

2) Arbitrary restrictions on the number of games, buy-in amounts, etc. do not work and simply creates the incentive for players to pool resources and form syndicates.

Esports such as Starcraft/Hearthstone are able to offer competition for all skill levels and ensure a positive experience through segregating their player pools via a ranking system. Create a separate game type called "Ladder Games" using an aggressive ranking system based upon daily results. Remove the lobby altogether and allow players to submit their game request to the server. By aggressively moving players up/down the ladder daily, the site can then pit players within a few rungs of the ladder against each other. Market it as A, AA, Triple A, Minor Leagues, Major Leagues, etc.

Don't like it? Don't play H2H ladder games and stick to unrestricted large field double-ups, GPPs, or non-ladder H2H games.

Give players the choice and I suspect H2H traffic will naturally gravitate towards it.
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Old 01-22-2015, 03:31 PM   #35
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Re: DFS Industry Discussion Thread (1st State law introduced today)

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Considering there is not a single profitable DFS-only operator, this is a very long way off, if ever, going to happen.
what were FD's operating expenses last quarter? They generated $36.8 MM in revenue. Obviously they had a lot of marketing spend, but I have no idea how much exactly. The other primary expenses should be rent, servers, and salary. They have 125 employees which at 100k/yr apiece would be $3.125 MM. Also, there will be small bonus expenses to players (call it $3.5 MM in deposit bonuses that cleared). That leaves $30 MM for 1q of ad spend, servers, and rent. While that might not be breakeven they have to be really really close.
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Old 01-22-2015, 04:21 PM   #36
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Re: DFS Industry Discussion Thread (1st State law introduced today)

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Originally Posted by Joe Tall View Post
What would happen, in your opinion, if all usernames were anonymous before contests were live? (Say this happened industry wide.)
The sharks would go crazy. Be a lot of head to head games against each other.
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Old 01-22-2015, 04:47 PM   #37
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Re: DFS Industry Discussion Thread (1st State law introduced today)

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Considering there is not a single profitable DFS-only operator,
Do you have link for this?
I had just assumed that the big sites were hugely profitable.
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Old 01-22-2015, 05:26 PM   #38
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Re: DFS Industry Discussion Thread (1st State law introduced today)

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Do you have link for this?.

There is a link, recent, when the FD numbers came out that flat out said "not profitable." (I'll try to dig it up, but trust me here.)


Quote:
I had just assumed that the big sites were hugely profitable.
Why?

Last edited by Joe Tall; 01-22-2015 at 05:33 PM.
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Old 01-22-2015, 05:28 PM   #39
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Re: DFS Industry Discussion Thread (1st State law introduced today)

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Originally Posted by CalledDownLight View Post
what were FD's operating expenses last quarter? They generated $36.8 MM in revenue. Obviously they had a lot of marketing spend, but I have no idea how much exactly. The other primary expenses should be rent, servers, and salary. They have 125 employees which at 100k/yr apiece would be $3.125 MM. Also, there will be small bonus expenses to players (call it $3.5 MM in deposit bonuses that cleared). That leaves $30 MM for 1q of ad spend, servers, and rent. While that might not be breakeven they have to be really really close.
Advertising on NFL games over major networks is very expensive. (Like $60m+ in the 4th Q, expensive.)
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Old 01-22-2015, 05:30 PM   #40
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Re: DFS Industry Discussion Thread (1st State law introduced today)

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I suspect the best players still buy all the action their bankroll can handle. Bumhunters would probably migrate away from h2h matches which would be a good thing as far as keeping fish in the player pool longer.
This is what I was thinking as well.
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Old 01-22-2015, 05:33 PM   #41
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Re: DFS Industry Discussion Thread (1st State law introduced today)

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Originally Posted by TomG View Post
1)

Esports such as Starcraft/Hearthstone are able to offer competition for all skill levels and ensure a positive experience through segregating their player pools via a ranking system. Create a separate game type called "Ladder Games" using an aggressive ranking system based upon daily results. Remove the lobby altogether and allow players to submit their game request to the server. By aggressively moving players up/down the ladder daily, the site can then pit players within a few rungs of the ladder against each other. Market it as A, AA, Triple A, Minor Leagues, Major Leagues, etc.

Don't like it? Don't play H2H ladder games and stick to unrestricted large field double-ups, GPPs, or non-ladder H2H games.

Give players the choice and I suspect H2H traffic will naturally gravitate towards it.
Very interesting, I'll have to look deeper into that esports structure. I like these ideas, thanks for sharing them.
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Old 01-22-2015, 05:37 PM   #42
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Re: DFS Industry Discussion Thread (1st State law introduced today)

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There is a link, recent, when the FD numbers came out that flat out said "not profitable." (I'll try to dig it up, but trust me here.)




Why?
I assumed that if they were advertising on major TV networks during major sporting events that they had to be making money. Guess I was thinking about that backwards.

So how much are the sites losing per year?
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Old 01-22-2015, 05:40 PM   #43
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Re: DFS Industry Discussion Thread (1st State law introduced today)

I assume FD could slash their marketing budget and be nicely in the black, but they're a lot more interested in growth and potential billions later than $20 mil now.
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Old 01-22-2015, 05:41 PM   #44
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Re: DFS Industry Discussion Thread (1st State law introduced today)

Also, what legitimate reason do sites have for NOT using anonymous screen names?
Are the pros really going to play less volume because they cannot identify fish?
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Old 01-22-2015, 05:43 PM   #45
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Re: DFS Industry Discussion Thread (1st State law introduced today)

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I assume FD could slash their marketing budget and be nicely in the black, but they're a lot more interested in growth and potential billions later than $20 mil now.
This makes sense, thanks.

I guess I I was confusing "profitable" with being a valuable company. Surely if they sold the business today they would net a huge profit, no?
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Old 01-22-2015, 05:45 PM   #46
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Re: DFS Industry Discussion Thread (1st State law introduced today)

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This makes sense, thanks.

I guess I I was confusing "profitable" with being a valuable company. Surely if they sold the business today they would net a huge profit, no?
Yep, they (FD/DK) have had no problems raising a ****ton of money, whenever they want it.
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Old 01-22-2015, 05:54 PM   #47
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Re: DFS Industry Discussion Thread (1st State law introduced today)

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I assumed that if they were advertising on major TV networks during major sporting events that they had to be making money. Guess I was thinking about that backwards.

So how much are the sites losing per year?
When a company needs to sell off equity to keep it afloat, well, its not profitable quite yet. Similar to how Twitter is not profitable, yet worth multi-millions.
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Old 01-22-2015, 05:55 PM   #48
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Re: DFS Industry Discussion Thread (1st State law introduced today)

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Yep, they (FD/DK) have had no problems raising a ****ton of money, whenever they want it.
Given the user growth, this is absolutely true.
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Old 01-22-2015, 07:40 PM   #49
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Re: DFS Industry Discussion Thread (1st State law introduced today)

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Originally Posted by CalledDownLight View Post
the sharks are already cannibals in DFS. The guys who do it full-time also, unsurprisingly, have the most data on who the terrible players are and are spending the most time refreshing the h2h lobbies and clicking on 3 mans etc. to find fish and take those games before they can be taken by other fish or bad regs who they stand a decent chance against.
I agree. I just don't think it will have any significant impact on the player pool.
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Old 01-23-2015, 10:23 AM   #50
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Re: DFS Industry Discussion Thread (1st State law introduced today)

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Do you have link for this?
I had just assumed that the big sites were hugely profitable.
Here's a link where the DK CEO says they're not yet profitable:

http://recode.net/2015/01/21/fantasy...s-big-in-2014/
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