DraftKings Signs On As Authorized Gaming Operator for Major League Baseball

Major League Baseball and DraftKings have announced a deal that will make the daily fantasy sports and sports betting company an authorized gaming operator for the league.

The deal, which was announced on Thursday, expands on a partnership that already saw DraftKings serve as the official daily fantasy game for MLB.

MLB Wants DraftKings to Drive Fan Engagement

Under the terms of the deal, DraftKings will be able to use official MLB data, marks, and logos in its sports betting products. That would presumably include both the company’s popular online offering in New Jersey, as well as its retail locations.

Those benefits are similar to the ones received by MGM Resorts when it announced its own gaming partnership with MLB last November. Financial terms have not been disclosed for either deal.

Major League Baseball’s interest in building sports betting partnerships comes down largely to the same factor that every other league has mentioned: improving fan engagement. The idea is that fans and other gamblers who have something at stake are more likely to watch and attend games, as well as stay interested even when one team is dominating early on.

“Given DraftKings’ successes in driving fan engagement with immersive experiences, we’re looking forward to an expanded partnership and further collaboration on engaging products,” MLB Executive Vice President of Gaming and New Business Ventures Kenny Gersh said in a statement. “The rools provided to DraftKings…will be central to creating these powerful new ways to consume and connect with our sport.”

The fact that official league data is included in the agreement is unsurprising, considering the emphasis that leagues have put on the importance of such feeds.

Deal Highlights Emphasis on Official Data

Many leagues have suggested that not only will official league data be faster and more detailed than other sources, but that it is the only way to preserve the integrity of betting markets by ensuring that in the information provided to sportsbooks is accurate. The betting industry has largely disagreed with these points, noting that there have been vanishingly few problems worldwide with unofficial data sources.

That argument took center stage at the 2018 Global Gaming Expo, where Gersh argued that regulated sportsbooks should be required to use official data, while American Gaming Association Senior Vice President Sara Slane said that bookmakers could decide for themselves what sources to use.

“I don’t think anyone is saying they wouldn’t pay for the data,” Slane said. “I just don’t think it should be done in statute…let it be done through contracts.”

For sportsbooks, the biggest advantage that leagues can provide with their own data is enhanced information that can expand what kinds of in-play betting are feasible for operators to offer.  Ezra Kucharz, chief business officer for DraftKings, referenced this in the statement announcing the MLB partnership.

“DraftKings is proud to be designated as a Major League Baseball Authorized Gaming Operator,” Kucharz said. “As a result of this agreement, our customers will experience enhanced live wagering offerings for all MLB games.”

Partnerships like these may also give MLB and other leagues an avenue for generating revenue off the legal sports betting industry. MLB has been among several leagues that have lobbied for integrity fees to be included in state level sports betting legislation, but those efforts have been wholly unsuccessful so far.