In the fight for fantasy sports primacy, DraftKings and FanDuel, the majority market-share leaders in the “daily” variety, resemble each other more and more—but they are also starting to resemble the long-established “season-long” fantasy providers.
DraftKings on August 12 announced a new feature, Leagues, that makes it easier for users to set up private groups with their friends and create recurring contests. The option to create a contest and invite friends existed on the platform before, but as cofounder and COO Paul Liberman acknowledges, “It was buried, and really difficult to use.”
DraftKings users, Liberman tells Yahoo Finance, frequently submitted feedback that the feature was clunky and left a lot to be desired.
A promo video for the new feature teases: “Want to run it all season long? You got it.” It may sound strange, at first, to hear the phrase “season long” in any marketing materials for DraftKings, which made its bones as a daily fantasy sports provider, offering a weekly (or more than weekly) alternative to traditional “season-long” fantasy sports, in which friends conduct a single draft at the beginning of the football season and keep that team for the length of the season.
But make no mistake: This is DraftKings dipping a toe into the season-long market. The structure is still “daily,” but the ability to create a league, and name it (as you would with a season-long league), and invite specific friends (as you would with season-long), and monitor a leaderboard that lasts all season (as happens with season-long), is all part of a foray into the much larger season-long market.
And FanDuel beat them to it, announcing the same kind of feature on August 1. FanDuel’s is called Friends Mode, it was announced as part of a larger rebrand, and it gives users the ability to play against a single group of friends all season long.
DraftKings Leagues launch on Tuesday, while FanDuel Friend Mode does not launch until the NFL season begins.
FanDuel, in its announcement, did not shy away from the association with season-long fantasy, calling its new feature “a new way to play season-long fantasy.”
DraftKings is being a little more cagey. “I think ultimately we are trying to create a complementary product to season-long,” Liberman says. “I think the functionality and the providers in season-long are kind of ingrained. We want to be something that people also do, in addition to season-long. We want to expand on season-long, make it more fun, more social, but at the end of the day, people have their season-long leagues they’ve been doing for 20 years, they like the draft experience, the snake draft, and they’re going to keep doing that on other platforms. We’re not trying to compete with those.”
DraftKings offers more sports than its rival: 10 of them (NFL, MLB, NBA, NHL, golf, Nascar, mixed martial arts, soccer, e-sports, and Canadian football, which it added in June) compared to FanDuel’s four (NFL, MLB, NBA, NHL). FanDuel CEO Nigel Eccles has said FanDuel is “deeper” in the four sports it offers. Yahoo Daily Fantasy, the distant No. 3 player (DraftKings and FanDuel enjoy a combined 95% market share of the $2 billion business), offers NFL, MLB, NBA, NHL, and soccer.
And 11 days after DraftKings rolled out its friend leagues, Yahoo, on August 23, announced the “Yahoo Cup,” a season-long contest where users can compete for weekly cash prizes all season. Like the DraftKings and FanDuel features, it is “daily” fantasy (you can draft a new team each week) in a season-long format. And the Yahoo Cup is free entry, so it is open to all 50 states.
The timing of all three companies announcing new features in the style of season-long fantasy is not accidental: The NFL season is about to start. It is the hottest time of year for new customer acquisition for the companies, which are both privately held “unicorns” valued at over $1 billion.
DraftKings, FanDuel, and Yahoo, along with two smaller providers (Draft and FantasyDraft) just got temporary licenses to operate paid contests in the state of New York, which last NFL season had more daily fantasy players than any other state. The daily fantasy sports industry got a legal victory earlier in August when New York Governor Andrew Cuomo signed a bill that protects the contests as legal, but it took weeks for them to finally obtain these licenses and re-open in New York.
In the last year, each of the three market leaders has announced some form of protection for new players, where the service will flag experienced veterans. Yahoo called the new additions “Fair Play” while FanDuel rolled out a “Bill of Rights,” and DraftKings launched a Game Integrity & Ethics Team.
Imitation is the sincerest form of flattery, as the saying goes, and tech startups aping each other’s features is nothing new. In the social networking world, Instagram this month added a “Stories” feature that is identical to Snapchat Stories.
The friend leagues are clearly aimed at attracting new users who play season-long fantasy football but haven’t yet tried daily. A line in the DraftKings promo video encourages users to invite friends, and then assures, “Anyone still not on DraftKings? Not a problem. Invite anyone you want with the push of a button.” DraftKings hopes users will invite friends that have resisted the platform, and that those friends will invite more friends. And FanDuel hopes to do the same.
Disclaimer: Yahoo, which offers a daily fantasy sports product, is the parent company of Yahoo Finance.
This post was updated on August 23, 2016.