If you remember, Fanduel and DraftKings agreed to merge, since 2016 was not ideal for these organisations, which still control over 90% of the market.
Yahoo Finance reported that a brand new research report from Krejcik and Eilers Gaming has massively cut the forecast for the industry. Krejcik and Eilers found that the Daily Fantasy Sports revenue grew by approximately 4% during 2016 to nearly $3.26b. However, the companies still are not making a profit.
The revenue for last year was previously projected at over than $4b. This, the market is being expected to be approximate $4.8b until 2020, which is down from a previous estimation of nearly $8b.
The two organisations have spent generously on advertising and have even had huge legal expenses. This is because several states challenged the legality of daily fantasy sports. Thus, the merger, which still is not approved by a regulator, will allegedly help solve both of their issues.
The Growth has slowed down since the customer base for DFS is not evolving. The report states that it is still mostly white males, with the approximate age of between 25 and 35. The Season-long fantasy is still the most appealing one, with over five times the approximate number of players than Daily Fantasy Sports.
Approximately 60m people played season-long during 2016.
DFS was legalised in 10 states, because of state lawmakers from across the country who questioned how the skill-based games fit with the already existing gambling law.