DraftKings Removes Branding from WSOP Main Event November Nine Broadcast
Following a declaration earlier this month by the Nevada Gaming Commission that daily fantasy sports is illegal gambling, it was announced this week that DraftKings branding no longer will appear at the World Series of Poker final table. When play was suspended on the WSOP Main Event on July 14, DraftKings logos could be found on the final table’s felt. When the November Nine finishes the 2015 WSOP Main Event on November 8 at the Rio in Paradise, Nevada, no such logos will be evident.
Throughout the 2015 World Series of Poker, the DraftKings logo was placed strategically on the table, so it could be seen anytime the flop came. The phrase “Daily Fantasy Sports for Cash” was emblazoned just under the word “DraftKings”, which wore a crown. The deal which assured that branding is now null-and-void, because daily fantasy sports is deemed illegal in the State of Nevada.
Nevada Gaming Council
DraftKings, FanDuel, and other DFS sites have been invited by Gaming Commission chairman A.G. Burnett to submit applications for a gaming license. It is expected that none of the top DFS services are going to do so, because it would undermine their contention that daily fantasy sports is not gambling. Thus, most DFS companies have pulled out of the Nevada gaming market.
The ruling by the NGC included a statement by Chairman Burnett which said, “DFS in Nevada is illegal without the appropriate license, [which means] all unlicensed activities must cease and desist from the date of this Notice until such time as either the Nevada Revised Statutes are changed or until such entities file for and obtain the requisite licenses to engage in said activity.”
Seth Palansky on the Decision
Seth Palansky, who is the director of the Corporate Communications Division of the Caesars Interactive Entertainment, said the decision to end the partnership was made by DraftKings. Caesars Entertainment owns the Rio, which displayed the DraftKings logos.
Mr. Palansky said, “In light of last week’s news in Nevada, DraftKings asked us to cease any sponsorship activities around the remaining few WSOP events of the year, and we complied.”
Max Steinberg and the November Nine
The decision to pull out of its WSOP Main event sponsorship is a revolution in public relations for the daily fantasy sports industry. DraftKings made the marketing decision to take the PokerStars route and sponsor entries into the World Series of Poker Main Event. Entrants to certain satellite events could win their way into the Main Event by winning those satellite events.
November Nine member Max Steinberg won one of those events, so his $27 entry fee into a DraftKings contest was his gateway to the $10,000 WSOP Main Event entry fee. Only a month ago, online gaming news sources were saying a Max Steinberg win could be DraftKings’ “Moneymaker Moment”, referring to the 2003 Main Event victory by PokerStars entry Chris Moneymaker, which touched off the “Poker Boom” in the United States and abroad.
Black October for the DFS Industry
Instead, the November Nine has more of a feel of the US gaming industry after the 2006 passage of the UIGEA or the 2011 Black Friday indictments. Daily fantasy sports is on the defensive, after an alleged “insider trading” scandal. DraftKings employee Ethan Haskell won $350K on a contest on FanDuel, the main competition in the DFS industry. Soon after, media reports suggested Haskell might have used inside information to gain an advantage over the rest of the field.
Though that contention has been debunked, US prosecutors and lawmakers have appeared out of the woodwork to seek to either ban or regulate the DFS industry. Preet Bharara, the dreaded New York prosecutor behind the Black Friday case, announced he would probe the industry. Under the circumstances, DFS companies are ducking for cover and the industry as a whole is likely to be lucky to see regulatory actions, instead of a complete ban.
Saturation of the Airwaves
One reason the hammer fell so hard was the intense advertising campaigns launched by DraftKings and FanDuel. Anyone watching a U.S. sporting event on television in the past six months was bombarded with DFS ads. While those advertisements drove signups, they also created a backlash among sports fans of all sorts, including the average fan, politicians, and late night talk show hosts.
A reaction might have been inevitable, but the Ethan Haskell controversy gave public figures a chance to go after the industry hard. Thus, DraftKings is making a wise decision to pull out of sponsorship for the WSOP Main Event, however hard that decision might be.