The fantasy sports industry has retained a team of lobbyists and attorneys in response to a bill making its way through Congress that would restrict certain types of online gambling nationwide.
The bill, sponsored by congressman Jason Chaffetz of Utah and senator Lindsey Graham of South Carolina, both republicans, targets online blackjack, poker, and other popular casino games. At this point, however, it makes no attempt to legislate against online fantasy sports.
Still, the Fantasy Sports Trade Association (FSTA), based in Chicago, views the bill as sufficiently portentous to justify taking preemptive measures and ensuring it has counsel on hand should the legality of its industry become threatened.
At this point, the industry’s focus has been on forming and crystallizing a public perception of fantasy sports as being vastly different from traditional gambling, as success in fantasy sports, it argues, is determined more by skill and knowledge than by luck and probability.
Another major difference pointed out by the FTSA is that most people who play fantasy sports, even in money leagues, do it for fun and to compete with friends and co-workers. The prospect of winning money is secondary.
While the FTSA has made it a clear objective to differentiate online fantasy sports from online casino games, it has yet to come out either against or in favor of the online gambling bill, instead saying it is simply keeping an eye on all potential legislation and working with its counsel to discern how any of it may affect their industry.
The online gambling bill from Chaffetz and Graham comes amid intense pressure from the casino industry and its heavy-hitting lobbyists in response to a 2011 Justice Department decision which enabled states to legalize online gambling. At least three states took advantage of this decision, most notably New Jersey, to the consternation of casino owners in the historic gambling hotbed of Atlantic City.
Casino owners claim that online gambling has been shown to be more addictive than traditional gambling in physical casinos, and that having access to this type of gambling 24/7 with nothing more than a computer and an Internet connection, without leaving one’s home, and with no oversight feeds gambling addictions and encourages irresponsible gambling behavior.
Online gambling also is terrible for local economies in states such as New Jersey, they argue, pointing to the millions of tourist dollars which have flooded into cities such as Atlantic City over the past century as a direct result of its casinos. Legalized online gambling encourages people to eschew pilgrimages to casino towns and instead stay home to gamble, which stanches the flow of money into the economies of gambling states, so goes their argument.
The casino industry’s lobbying was enough to spur Congress into action, as evidenced by the online gambling bill from Chaffetz and Graham. However, multiple studies which have been released since the bill was drafted have pointed to the conclusion that online gambling is not, in fact, addictive, or at least not any more addictive than live gambling in a casino. The nascent and largely unorganized online gambling lobby has been quick to point out the results of these studies, though it remains to be seen if they have the clout (or, more importantly, the money) to go toe-to-toe with the casino industry.
For now, the fantasy sports industry is taking a wait-and-see approach regarding all legislation related to online gambling. To date, fantasy sports has not been classified as gambling by any regulatory body, though it is worth noting that organizations such as PayPal do consider it as such and as a result, prohibit the transfer of funds for anything related to this type of activity.
A fantasy football enthusiast from West Palm Beach, Florida, in an interview with the FTSA, called the potential classification of fantasy sports as online gambling “ridiculous.” “I play fantasy football for fun and to keep in touch with my college buddies,” the man, who wished to remain anonymous, stated. “The $20 entrance fee in our league is for nothing more than to spice up the competition and to encourage everyone to put in a little effort. It’s not like we’re trying to hit it big in Vegas.”
The fate of online gambling and, as an extension, of fantasy sports, under an increasingly watchful and regulatory government remains to be seen. The industry has played it smart, though, by arming itself with knowledge and allies in case the political winds shift against them.