After a nearly yearlong hiatus, daily fantasy sports may once again return to Nevada in a few months, but the product won’t take the same shape it did before.
Daily fantasy giants FanDuel and DraftKings remain out of the state, and it’s not clear if or when they will ever return. However, Nevada gambling regulators may allow sports betting pioneer Vic Salerno to bring daily fantasy sports back in a manner that resembles a more traditional form of sports betting.
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Salerno has already won approval from the Nevada Gaming Control Board, and the Gaming Commission is considering his application for final approval today. If it clears that last hurdle, Salerno hopes his company USFantasy Sports will start facilitating daily fantasy sports bets in August, just in time for the 2016 NFL season.
In an interview, Salerno described his product as a combination of normal fantasy sports and pari-mutuel wagering, in which individuals bet among themselves instead of against the house.
Under USFantasy’s model, bettors will be able to wager on whether a certain athlete will win, place or show in a particular contest field, and they can also place more complicated multi-athlete wagers.
Vic Salerno
Salerno said there are a variety of different ways to score the fantasy contests, and the methodology would be explained upfront so the bettor knows how winners are determined. For example, a contest might award one point for every yard thrown by a quarterback, with more given for touchdowns and negative points imposed for throwing an interception.
“We’re going to put out a lot of different things and see what’s popular and what the customers like the most and get their feedback on what kind of scoring they do like,” Salerno said. “Almost every fantasy sport has a different way of awarding points, and they can get real complicated.”
For football, Salerno said fantasy pools could encompass multiple days since there might only be two quarterbacks, for instance, on a day with only one game played. Additionally, Salerno said his company plans to have a $1 million progressive jackpot available to those who can correctly pick the winner for seven specific football positions.
If approved by regulators, fantasy bets will be available for in-person wagering at participating sports books as well as on mobile applications. USFantasy plans to offer both daily and weekly fantasy sports contests for major league football, baseball, basketball, golf and hockey as well as NASCAR and other international sports.
After getting the green light in Nevada, Salerno hopes to take his product to other states as the debate over regulation of daily fantasy sports continues.
“All these different states are now trying to create laws for daily fantasy sports, and we feel we have the right answer for them. It’s regulated; it’s transparent,” he said. “We feel this combination is the perfect thing.”
FanDuel, DraftKings and similar companies left Nevada in October after the Gaming Control Board determined that daily fantasy sports was gambling under state law, meaning operators needed a license to continue offering the product. Since then, the subject has received attention from regulators and legislators in other states across the country.
Governors in six states — Colorado, Virginia, Indiana, Missouri, Mississippi and Tennessee — have signed legislation regulating daily fantasy sports. In New York, where FanDuel and DraftKings eventually stopped operating after the state attorney general deemed their product illegal gambling, legislators just approved a bill that would legalize and regulate daily fantasy sports. It awaits Gov. Andrew Cuomo’s signature.
As more states start regulating daily fantasy sports, the product will evolve beyond what is available from DraftKings and FanDuel, according to Chris Grove, publisher of the website Legal Sports Report.
“We’re going to see new companies trying new variants. They sometimes will be minor variations on the dominant model, and they sometimes will be completely new takes on that model and resemble it in name only,” Grove said. “I think Vic’s is probably the first of what will be many fresh takes on the daily fantasy sports product.”
Salerno has a long and reputable history in Nevada sports betting. He came to Las Vegas in the late 1970s to take over Leroy’s Horse & Sports Place from his father-in-law, and he replaced handwritten betting tickets with a computerized betting system a few years later. His other credentials include being one of the first operators to provide telephone account wagering, developing the first self-service sports wagering kiosk and creating Nevada’s first mobile sports betting app.
Until recently, Salerno was the board chairman of sports betting company William Hill US. He was inducted into the Gaming Hall of Fame at last year’s Global Gaming Expo, a major casino industry trade show held annually in Las Vegas.
Salerno thinks his daily fantasy product will appeal to millennials, a demographic the casino industry is eager to attract. That’s not only because of the daily fantasy nature of it but also due to its availability on mobile apps, which Salerno called the “main driving force” behind the recent positive performance from Nevada sports books. Sports betting handle in the state hit a record $4.2 billion last year.
“Our computers in our pocket have now become the thing that we do everything with,” Salerno said. “Millennials are much more in tune with it, and it’s an easier game than learning how to play the horses or shoot craps. I think it’s more in the millennials' wheelhouse.”
While Salerno is poised to introduce a new version of daily fantasy sports, the future of the leading daily fantasy companies in Nevada is still up in the air. When the state’s Gaming Policy Committee discussed daily fantasy sports at its meeting in March, the top executives of FanDuel and DraftKings appeared disinclined to work within the state’s existing regulations for sports betting.
A specific alternative has yet to emerge, but control board Chairman A.G Burnett said he was waiting to receive a draft proposal from FanDuel and DraftKings.
Burnett said he was told they were preparing “something for us to review,” but he hadn’t seen anything yet. Spokespeople for both companies did not respond to requests for comment.
Even if FanDuel and DraftKings do submit proposals, however, they’ll need to convince state officials to take action.
“We ruled last October that DFS was gaming and constituted a sports pool,” Burnett said. “It’s already legal in Nevada, and we already regulate sports pools. So I’m not sure what else would need to be done, but I’m happy to hear from interested parties on that.”