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.

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.

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.

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.

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)

Considering there is not a single profitable DFS-only operator, this is a very long way off, if ever, going to happen.

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.

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.

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.

The sharks would go crazy. Be a lot of head to head games against each other.

Do you have link for this?
I had just assumed that the big sites were hugely profitable.

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?

Advertising on NFL games over major networks is very expensive. (Like $60m+ in the 4th Q, expensive.)

This is what I was thinking as well.

Very interesting, I'll have to look deeper into that esports structure. I like these ideas, thanks for sharing them.

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?

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.

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?

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.

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.

Given the user growth, this is absolutely true.

I agree. I just don't think it will have any significant impact on the player pool.

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/