Blog: Remember, the DFS customer is always right

Blog: Remember, the DFS customer is always right

Monday, October 19, 2015 Totally Gaming
MGM's Craig Jacobs discusses the steps DFS operators must take to keep the public on side

Craig Jacobs, MGM Resorts International executive, tells TotallyGaming.com that DraftKings and other DFS operators must both act and be seen to act honestly if they are to retain the trust of their players 

Daily fantasy sports (DFS) recently came under scrutiny when a DraftKings ownership report was released in error and a few days later, the employee responsible for the error won a $350,000 (€308,000) prize on a competing daily fantasy site.

One could suggest that the proportion of media attention on this supposed scandal seems to correlate with the intensified advertising and revenue being generated in the US from this growing revolution in sports wagering.

As with most tipping points, there are likely to be a few bumps in the road to change. Legal arguments aside, the incident seems to strengthen the position of daily fantasy as a skill-based game, more akin to a stock market-chess game as opposed to traditional sports wagering. However, Nevada just fired another shot by calling for daily fantasy sports to cease operations in the state, a precedent that may be a tipping point in the regulatory position.

Employees of daily fantasy operators are likely to be highly skilled in the fantasy sports world, just as stock brokers are likely to be skilled at selecting better stocks. As long as both individuals are making judgements with the best available information they are legally allowed to have, then their skill has a better than even chance to result in a capital gain.

From a security and integrity standpoint all gaming operators need to protect their important data. Whether it is a traditional casino protecting the PAR values of their slot machines or a fantasy operator protecting their ownership lists, all critical data must have controls to mitigate data loss or leaks. This is much easier said than done because, in each case, humans are involved.

If the DraftKings employee had been trying to play the system, a few more layers of smoke and mirrors could have been easily employed to limit the risk of exposure. The key learning point for the industry must be the controls and policies to limit this type of media event from occurring.

The initial reaction to disallow employees from playing any daily fantasy sports for money mitigates the current scenario from occurring again. At a deeper level, all gaming operators should take the opportunity to look at areas of their business that contain critical data that could be used by an insider or outsider to gain an advantage and tip the playing field. 

Hopefully for the industry as a whole this is a temporary setback that will be independently verified by third-party auditors and DraftKings will be able to put the unwanted fanfare behind it.

The gaming industry has been looking for ways to stay relevant with the millennial generation and seems to have misunderstood the part that daily fantasy, social and online gaming already play in that equation.

We are only in the first quarter of this contest and we must ensure that the consumers win. However,  with the recent ruling in Nevada, the playing field could be changing quickly.

 

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