Yahoo! is the newest entrant in the daily fantasy sports ring, introducing heavy competition to a market that has been dominated by billion-dollar first-movers FanDuel and DraftKings.
Fantasy sports has grown rapidly, with the Fantasy Sports Trade Association estimating that 41.5 million Americans participated in fantasy sports leagues last year. That’s a 13% increase from three years ago, and has led to $11 billion annual spending on league dues, research and web hosting fees. Each user spends an average of $111 every year on fantasy sports.
FanDuel owns two-thirds of the market while DraftKings, which is three years younger, claims the remaining one-third of the market. But the entrance of Yahoo!, with a longer operating history and a much stronger user-base, threatens that dominance. The internet company will try to leverage its existing fantasy player-base and fantasy news source to potentially become a formidable competitor in the daily fantasy market. This move puts Yahoo! ahead of ESPN, one of its biggest competitors in sports news and season-long fantasy leagues, which is considering its own daily fantasy expansion.
This announcement comes just a week after Yahoo! Sports announced the shuttering of its fantasy MLS league to focus on its fantasy sports app. Though the site’s Barclays Premier League fantasy league remains active, MLS fantasy fans must turn to MLS’ just-announced in-house fantasy league.