ESPN is considering expanding its fantasy sports offerings to include single-day competitions, another indication of growth of that subset of the market.
ESPN, whose current daily-game offerings are mostly limited to the semi-popular “Streak for the Cash,” would be following the leads of NBC Sports Ventures, Comcast Ventures and Fox Sports, each of which have investments or partnerships with daily fantasy sports (DFS) platforms.
ESPN would be several years behind the fastest growing trend in fantasy sports, as the two primary fantasy sports sites – FanDuel and DraftKings – have head starts of several years of name recognition. The two sites also accumulated $41 million and $70 million, respectively, in recent capital raises.
“The barriers to entry in short-term fantasy now are marketing dollars and the ability to reach an audience, so if it’s a media company, those things are built in.”
ESPN’s entry into the daily fantasy arena may be aided by the absence of a zero-sum factor in the market. Season-long leagues take long-term dedication and commitments of time, limiting the number of leagues and sites users have the bandwidth to join. Daily competitions, on the other hand, are quick, allowing fans to stay involved in multiple competitions across numerous platforms.
So though FanDuel has captured 65 percent to 70 percent of the market, DraftKings has seen exponential growth as well, with its number of users increasing 12 times from last year. Fantasy sports users aren’t necessary loyal to particular sites. The Fantasy Sports Trade Association asserts that nearly 75 percent of the 41.5 million fantasy sports users use four to six sports websites. Translation: There’s plenty of room for new entrants.
Rather than establishing a competing daily fantasy sports platform, ESPN may look to purchase a pre-established site and simply throw the weight of its brand behind that investment. FantasyUp, a site created by a former FanDuel winner, was created for just that purpose, with founder Dan Ziernicki promising to turn his start-up into a “cash cow . . . that is ready to go” should ESPN make an offer.