While prior questions about the legality of daily fantasy sports (DFS) seem almost quaint these days considering there’s no longer a stigma in it being likened to sports betting, Arizona had been one of the holdout states.
Arizona lawmakers explicitly barred the wildly popular industry from operating within its jurisdiction. That is, until April 15, 2021.
That’s when HB 2772, a robust piece of legislation most prominent for legalizing sports betting within the Grand Canyon State, was signed into law by Gov. Doug Ducey. Despite the fact that the state legalized up to 20 new licensed Arizona sports betting operators, DFS is hardly an afterthought.
Now, daily fantasy sports is live in Arizona, launching Aug. 28, 2021.
What operators are licensed to offer DFS in Arizona?
Prior to fantasy sports launching in the state, it was widely expected that heavy-hitters such as DraftKings, FanDuel and Yahoo would target Arizona. Those brands are considered the top three DFS operators by a comfortable margin.
Indeed that came to fruition, as all three received licenses to offer daily fantasy sports in the state, NFL, NBA, MLB, NHL and WNBA teams, as well as four Division 1, five NAIA and 15 NJCAA college athletic programs. But they’re not alone.
The Arizona Department of Gaming approved six companies to operate daily fantasy sports in Arizona:
- Fantasy Sports Shark
- Underdog Sports
There is already a well-established precedent of DFS operators forging marketing/sponsorship agreements with professional teams in individual states where the industry operates. Arizona has already joined the fray in this regard, as FanDuel and the Phoenix Suns announced a partnership that will, in part, make FD the official DFS partner of the surging NBA club. There is certainly a high likelihood of multiple other such hybrid sports betting/DFS pacts eventually being executed within the state.
How to get started playing Arizona DFS
Signing up to play daily fantasy sports in Arizona is quite simple. All you need is a few pieces of information to submit to your DFS brand of choice.
Operators need this info in order to verify the ages and identities of players in the state and determine if they are eligible to participate. The state requires players to be at least 21 years old in order to play Arizona fantasy sports.
When signing up, users should be ready to provide the following:
- Legal or full name
- Date of birth
- Residential address
- Email address
After agreeing to the terms of conditions of the DFS operator, users will be ready to fund their accounts and play fantasy sports in the Grand Canyon State.
The state authorizes platforms to accept various forms of payment for users looking to make deposits in their accounts. They include:
- Electronic funds transfer
- Credit card
- Debit card
- Wire transfer
DFS in Arizona tied to sports betting
One estimate pegs DFS’ annual revenue for 2019, the last “normal” year for what could be some time, at $2.9 billion. Both FanDuel and DraftKings boast multi-billion-dollar valuations.
As noted, the pair of industry leaders, along with No. 3 player Yahoo, have each received licensing to offer their DFS products to Arizona residents. When it comes to both FanDuel and DraftKings, there should also be a healthy amount of cross-promotion and appealing offers targeted at DFS players who might be interested in sports betting as well.
The official launch of the DFS industry came Aug. 28, the same day mobile betting apps in Arizona pre-launched and allowed users to sign up for and fund their online sportsbook accounts. The first legal wagers, though, did not take place until Sept. 9. That said, DFS went live just days before the calendar flipped to September — well in time for operators to accept paid entries for NFL fantasy contests.
How do daily fantasy sports work?
Daily fantasy sports ratchets up the concept of traditional fantasy sports several notches by allowing participants to enter contests and set new fantasy new lineups on a daily and intra-day basis for a wide variety of sports. Paid-entry daily fantasy sports date back as far as 2007, when a site by the name of Daily Fantasy Sports Live launched.
In the subsequent decade-plus, the industry has grown exponentially, with juggernauts such as FanDuel and DraftKings launching in 2009 and 2012, respectively. Initially there were some challenging years navigating the industry’s legality in a number of different jurisdictions around the country. Then there was an aggressive lobbying state-by-state lobbying push. Finally, the eventual eradication of the Professional and Amateur Sports Protection Act (PASPA) helped DFS gain much firmer legal traction, with a substantial amount of state legislators’ attention turning toward the question of whether to legalize sports betting.
Types of DFS contests
DraftKings, FanDuel and Yahoo primarily follow a model of what has become known, for lack of a better term, as legacy DFS contests. These contests follow a salary-cap-based model, where contest participants must build a roster of real-world athletes from a prespecified slate of games without exceeding a specific dollar figure. Each athlete is assigned a specific salary by the DFS operator.
Contests are based on a peer-to-peer model, where contest participants compete against the other entrants with respect to the cumulative scores their lineups accrue. Each contest has a preset prize structure and prize pool.
The most common DFS contest types offered by DraftKings, FanDuel, and Yahoo include:
Guaranteed prize pools: Also known as tournaments, these contests typically offer large entrant fields and multiple entries are allowed. The contests run whether or not they fill to capacity, and a percentage of the field well less than 50.0% are paid out on a sliding scale of cash prizes based on final finishing position.
Cash games: DFS contests where typically half the field or close to it is paid out. Examples of cash games include head-to-head DFS contests against another user, 50/50 contests where the top half of the field is paid, and multipliers, where the percentage of the field that cashes wins an amount equal to a certain preset multiplier of their entry fee.
Leagues: Sort of a hybrid between GPPs and cash games, leagues are usually smaller-field contests that can range anywhere from three participants to 200, and that often pay out about 30-35% of the field.
Alternative daily fantasy options
In addition to the “Big Three” of DK, FD and Yahoo, it’s certainly notable that several other DFS operators have recently opted to pivot somewhat from traditional salary-cap-based contest offerings and instead focus on contest formats that actually heavily borrow from traditional sports prop betting. Two prominent examples of such operators are Monkey Knife Fight (MKF) and PrizePicks.
The contests offered by both companies center on participants guessing whether or not a real-world athlete in that day’s slate of games will exceed or fall short of specific statistical milestones preset by the operator. While MKF utilizes both actual statistical categories from each sporting event for these contests but also offers a fantasy-point scoring system that is utilized as the benchmark, PrizePicks focuses on its fantasy point system in terms of the statistical milestones it asks its participants to make their selections on.