Category
🥇
SportsTranscript
00:00Interesting senator here on a call with Department of Justice about a potential monopoly or you
00:10know, whatever you want to call it antitrust because of the fact that FanDuel and DraftKings
00:15have such a big part of the market share.
00:17Do they not understand that there are a lot of other places to bet all over the country?
00:21You'll have to explain this one to me.
00:23Yeah, Craig, pretty interesting news happened late on Friday.
00:28Two U.S. Senators, Mike Lee of Utah and Peter Welch of Vermont, one a Republican, one a
00:33Democrat, writing this letter to the Department of Justice and the Federal Trade Commission,
00:39basically asking them to investigate DraftKings and FanDuel for antitrust violations.
00:44The letter cites only one source, a Temple Law article that mentions that DraftKings
00:51and FanDuel have used their lobbying group, the Sports Betting Alliance, to essentially
00:57allegedly coerce their partners into not allowing other competition into the market to use kind
01:05of their relationships, weaponizing that group against other people in the market.
01:10Now, it's really interesting for a number of reasons.
01:13We can start with the fact that whoever is at the Department of Justice right now and
01:18whoever is at the FTC right now, I would say almost 100 percent certainty is not going
01:24to be there in January because a new president is taking over.
01:28Donald Trump is expected to pretty much clean house pretty much any time you go from one
01:34party to another.
01:36They appoint a whole new slew of agencies overseeing these things.
01:40So it's sent to these lame duck, these lame duck groups.
01:44And then to go further than that, the Sports Betting Alliance, which is named in the letter
01:48that says it kind of allegedly has been used as a weapon, they also represent a lot of
01:54competition of DraftKings and FanDuel, notably BetMGM and Fanatics.
01:59So the letter kind of says that DraftKings and FanDuel have been using this group that
02:02also represents some of their competition, pretty kind of eyebrow raising stuff here.
02:08Now, DraftKings and FanDuel, like you mentioned, do have about 77 percent of the market.
02:13Fans have had the freedom to choose whatever sports betting apps they want.
02:17You have had a bunch of new sports betting apps pop up.
02:20Over the last year, even as the market consolidates, you know, Fanatics has a ton of capital.
02:25They bought PointsBet.
02:26They're backed by Michael Rubin, who's a billionaire.
02:29Bet365 is now expanding in the U.S.
02:31They're one of the largest global gaming operators.
02:33So you kind of are wondering what competition specifically are they accusing DraftKings
02:39and FanDuel of kind of working together to go against here.
02:43Now, the letter does mention that the two groups tried to merge in 2016, back before
02:46sports betting was legal beyond Nevada.
02:48But that was blocked by the FTC at the time, saying it would create a monopoly over the
02:52fantasy sports market.
02:54Obviously, DraftKings and FanDuel are much more focused on online sports betting now
02:58than they were back then with fantasy sports.
03:01But going to be interesting to see what comes of this.
03:04There's also a call for a Senate Judiciary Committee hearing next week, which is going
03:09to involve these two senators as well.
03:11So maybe they'll provide some more color there during that commentary.