Comcast announced several new features for its Xfinity X1 pay TV platform, including a partnership with DraftKings that will make degenerative sports gambling as easy as clicking on a QR code. 

X1’s new Odds Zone shows DraftKings odds for major sporting events as they unfurl live on the same screen. X1 now allows the user to place bets using a QR code and the DraftKings app on their smartphone. 

Comcast said that Xfinity Odds Zone will be available for most major sporting events, including the upcoming men’s and women’s NCAA basketball tournaments, the NBA and NHL playoffs, and for the start of the NFL and MLB seasons.

Separately, Comcast is also launching what it calls a new “immersive viewing experience” around pro golf's The Players Championship, which will be presented on NBC, Golf Channel, Peacock and ESPN Plus from Palm Valley, Florida, March 12-17.

By saying “the players” in their voice remote, customers can tap into features including an interactive course tour of all 18 holes of the Stadium Course at TPC Sawgrass, a dynamic scorecard that shows how the course is playing in a given round, and a live leaderboard with tee times and in-progress round-by-round scoring. 

Additionally, users will find curated news and highlights from NBC, ESPN and the PGA Tour FAST channel, which offers live programming powered by new technology available to content partners through Xumo Enterprise. Customers can also launch Xfinity Odds Zone from the experience, providing a quick and seamless way to see the latest tournament odds and initiate bets via the DraftKings mobile app.

“With Comcast Business as a Proud Partner, The Players Championship is a perfect opportunity to showcase the power of our platform to help customers find, watch and enjoy events that span multiple networks and streaming services, along with interactive features for fans who want an even deeper experience,” said Vito Forlenza, VP of entertainment apps for Comcast, in a statement. 

The New York State Gaming Commission approved four licensed mobile sports wagering operators to begin taking mobile bets in the state beginning at 9 a.m. on January 8, and cable networks are gearing up for what they hope to be a big financial windfall.

Caesars Sportsbook, DraftKings, FanDuel, and Rush Street Interactive, which operates the BetRivers Sportsbook, got the green light from the Gaming Commission on Jan. 7, about a week prior to the January 15 start of the National Football Leauge playoffs and around a month before Super Bowl LVI on February 13, the biggest betting day of the year.

In a press release, Rush Interactive CEO Richard Schwartz said New York’s decision came just in time. 

“With the college football championship game on January 10th and NFL playoffs approaching, and the NBA and NHL seasons in full swing, in addition to countless other sports and betting options available for play, fans have endless entertainment at their fingertips at BetRivers,” Schwartz said in a press release.

Eyeing a $10 Billion Opportunity

New York State expects mobile sports gambling to represent a $10 billion revenue windfall annually. On Nov. 8, the state agreed to allow mobile sports wagering — about 18 other states, including neighboring New Jersey, have allowed it for months —- with the government taking 51% of gross revenue generated by the providers. 

With New York in the mix, however, other states that have been on the fence regarding mobile sports betting — including Connecticut, Delaware, Ohio, Louisiana, and Maryland, which have approved mobile gambling but haven’t gone live — will give them a needed push. 

“When it starts in New York, it becomes a national story,” said sports consultant Lee Berke, CEO of LHB Sports Media & Entertainment. “You’ve got four of the biggest sportsbooks starting on this, they’re creating New York-specific commercials, it’s going to become a subject of New York-based media outlets,” which should give any fence-sitters a needed push.

Another incentive for states: the enormous amount of money to be made. Some reports estimate that New York could reap about $1 billion in yearly profits from mobile sports betting. The state also is charging each mobile sports wagering operator a one-time $200 million licensing fee, and other providers are expected to join the fray. Initially nine providers were conditionally licensed by the state — Bally Corp.’s BallyNets; BetMGM, WynnBET; PointsBet New York; and Empire Resorts, doing business as Resorts World — were the others. The state Gaming Commission is still considering those five other applicants.   

“The remaining five conditionally licensed Mobile Sports Wagering Operators continue to work towards satisfying statutory and regulatory requirements necessary to launch and will be approved on a rolling basis when requirements are met,” the Gaming Commission said in a statement.

New Jersey has said gross revenue from online sports wagering was about $1 billion in September, most of that from mobile transactions. New York allowing mobile betting might cut into that handle — New York City gamblers were known to travel into the state just to make mobile bets. According to some reports, New York gamblers made about 25% to 30% of the sports bets in New Jersey. 

For television networks, the initial windfall is likely to be in the form of additional advertising — already Caesar’s Sportsbook, FanDuel, DraftKings and Rush Street, have been ramping up ads leading to Jan. 8. While sportsbooks have been advertising on sports channels ever since the U.S. Supreme Court allowed legal sports wagering in 2018, Berke said the introduction of the largest media market in the country to mobile wagering is a game-changer. 

“As it becomes more national in scope, the economics change in terms of being able to offer up a range of national content in a range of national media outlets,” Berke said. “Even six months ago, buying on the NFL, people were starting to do it, but it’s inefficient because half of the country can’t bet. When New York kicks in, suddenly, things change.” 

Berke said that viewers should expect similar programming on other sports channels, as “the line blurs between what is sports programming and what is sports betting programming.”

At YES Network, the home of New York Yankees baseball, Brooklyn Nets basketball, New York City Football Club soccer and New York Liberty basketball, the initial impact will mainly be on ad sales. But the RSN, the most-watched in the country, already has strong relationships with sportsbooks like FanDuel and DraftKings, so New York's entry into mobile sports betting “just makes YES all the more valuable to these entities,” said spokesman Eric Handler. 

FanDuel and DraftKings probably have the biggest relationships with television networks, having inked a deal with Turner Sports in October 2020 to integrate betting information into content from TNT, TBS and Bleacher Report. That pact also included the ability for Turner to collect referral fees if bettors placed wagers through their sites. 

MSG Moves Aggressively

Across the board, sports networks have long been anticipating this day, and many have spent the past few months forging partnerships with casinos and sports wagering outlets and creating programming geared toward gaming aficionados.  

One of the more aggressive networks on the programming and deal fronts has been New York area regional sports network MSG Networks, which has expanded its sports betting-focused programming. In October MSG Networks launched Odds with Ends hosted by former New York Giants players Mathias Kiwanuka and David Tyree on Sunday mornings during the NFL season; and The Bettor Half Hour hosted by Alex Monaco to complement its existing betting shows including The Betting Exchange with sports gaming experts Katie Mox, Jeff Johnson and former New York Jets safety Erik Coleman.

Also last year, MSG Networks struck marketing partnerships with FanDuel, Bet 365, BetMGM and Caesars Sportsbook.   

Caesars Sportsbook also plans to launch a new series on MSG Networks and its social media channels featuring actor and comedian JB Smoove — who also stars in the sportsbook’s national commercials. The show, One Course with JB Smoove, will integrate Caesars Sportsbook betting odds and content. In addition, the gaming giant and MSG Networks will launch a 20-part programming marathon to bring back the 2013 series Four Courses with JB Smoove, where the actor and comedian conversed with athletes and celebrities over dinner and which will now be updated with Caesars-themed content.

Caesar’s Sportsbook also will sponsor a special month-long programming block tied to former New York Ranger goalie Henrik Lundqvist. ■

The New York State Gaming Commission’s decision to approve mobile betting licenses for nine gaming operators — including FanDuel, DraftKings, Caesars Entertainment, Bally Sports and others with strong media ties — could be a big windfall for cable, broadcast and streaming sports channels that have spent the past three years forging relationships with sports books.

The New York State Gaming Commission on Nov. 8 issued 10-year mobile betting licenses to a group including FanDuel, DraftKings, Bally Corp.’s BallyNets; and to BetMGM, a partnership between MGM Resorts International and Entain PLC. The second group consists of Caesars Entertainment‘s Caesars Sportsbook; Rush Street International; Wynn Resorts’ WynnBET; PointsBet New York; and Empire Resorts, doing business as Resorts World.

With the approvals, sports bettors in the state will be able to make wagers through their mobile phones. Previously they could only bet on sports at physical casinos. The impact could be huge. New York state is the biggest sports-betting market in the country by some estimates, and could represent an additional $1 billion annually in wagering revenue. Cable, broadcast and streaming sports channels that have been forging relationships with gaming companies since the U.S. Supreme Court first allowed legal sports wagering in 2018 also could reap big rewards. 

New York residents won’t be able to begin betting on sports through their phones immediately. The state still has a few technical kinks to work out, but most observers believe mobile wagering will begin well before Super Bowl LVI on Feb. 13, the biggest betting day of the year.

In an interview, Lee Berke, sports consultant and president and CEO of LHB Sports, Entertainment & Media, said the initial impact for sports networks will likely be on the advertising side. But networks, which have spent the past three years forming relationships with betting houses, are also in line to reap big rewards when remote betting becomes part of the game broadcasts themselves. 

“As much as sports betting has been legalized in over half the country, New York includes the No. 1 DMA in the country and it’s just going to drive the trend toward the acceptance and the marketing and the development of the sports betting business well beyond where it has been up to this point,” Berke said. “It’s a big moment.”

It’s also a big moment for the state, which will charge each licensee a $200 million one-time fee and tax mobile sports wagering revenue at 51% annually, one of the highest among states that allow mobile betting. But the potential for success in New York is huge. The gaming commission estimated New York would reap about $489 million in annual tax revenue from a $1 billion sports wagering market.

Berke said for the networks, the impact will be seen in programming as well as advertising. He noted that Caesars Entertainment has been involved in a big national ad campaign around its Caesars Sportsbook, which launched in August in 11 states and the District of Columbia — Arizona, Tennessee, Illinois, Indiana, Iowa, West Virginia, Michigan, Colorado, Virginia, New Jersey, Nevada and Washington, D.C. 

“You’ve got Caesars in the middle of a national ad campaign even though half the states don't allow sports betting,” Berke said. “They’re already spending, but when you open up individual states, it’s naturally going to create a lot of additional media spend in those states to reach those audiences.”

Berke also said to expect more betting-focused content to be available on TV. “There is going to be a lot of fallout from the rights finally being awarded,” he said.

In the meantime, the addition of New York to the mobile betting arena should drive interest and revenue.

While the gaming commission estimated about $1 billion in New York  sports betting revenue, mobile could help boost that figure skyward. New Jersey, which has allowed mobile sports betting since 2018, raked in about $1 billion in sports wagering revenue in September alone. Most of that was via mobile bets. 

Some New York legislators have chafed over the lack of mobile sports betting in the state in the past. In an October article in the New York Times, New York State Senate committee on racing, wagering and gaming chairman Joseph P. Addabbo, Jr., a Queens-based Democrat, said the state was missing out on millions of dollars in tax revenue without mobile betting. That same article depicted city residents who regularly bike over the George Washington Bridge to place mobile bets in New Jersey. 

According to the American Gaming Association, sports wagering generated $886.5 million in revenue nationally in Q3, a quarterly low for the year because of a limited number of end of summer games, but still up 153.1% from the prior year. AGA said that combined sports betting and iGaming revenue for the first nine months of the year was up 200% to $5.36 billion.  

Already the marketing deals are starting to grow. On Nov. 9, Madison Square Garden Sports and Madison Square Garden Entertainment unveiled a multi-year marketing partnership with BetMGM, where the sportsbook would receive substantial brand integration inside the Madison Square Garden arena during New York Knicks and New York Rangers games. As part of the deal, BetMGM will also be featured prominently on regional sports networks MSG and MSG Plus during coverage of the Knicks, Rangers, New Jersey Devils and New York Islanders, highlighted by a virtual blue line during Rangers games and commercial spots during game telecasts, the companies said.

FanDuel and DraftKings probably have the biggest relationships with television networks, having inked a deal with Turner Sports in October 2020 to integrate betting information into content from TNT, TBS and Bleacher Report. That pact also included the ability for Turner to collect referral fees if bettors placed wagers through their sites. 

Bally Corp. signed a 10-year, $88 million deal in 2020 with Sinclair Broadcast Group to rebrand that company’s regional sports networks under the Bally Sports name. Bally also launched its mobile betting app, BallyBet, this year in Colorado and Iowa and plans to expand its online gaming reach to other states. In a press release, Bally Corp. chairman Soo Kim said the NYS Gaming Commission approval advances Bally’s footprint and “marks the latest milestone on our journey towards becoming the leading omnichannel gaming provider in the U.S. Above all, we look forward to providing New York's devoted fan base with engaging, best-in-class, sports betting experiences.“

Bally had earlier been rumored to be among the groups that would win approval from the NYS Gaming Commission, and during a conference call with analysts to discuss Q3 results on Nov. 3 (five days before the award was announced), Bally CEO Lee Fenton said that the company was comfortable with its position to gain access to the state, but lamented the proposed high tax rate for participants.

“No one is happy with a 51% tax rate,” Fenton said on the call. “I think that would be true for all of the partners that we‘ve been working with as well. But it‘s a huge state. And therefore, the scale of it means that you can have opportunities.”

Among those opportunities is with Sinclair’s RSNs, which Fenton said Bally’s could leverage within New York and in the outskirts of the state. “So obviously, I think it will change the cost dynamics of all operators that enter that market in terms of how they might address and attack that market. But clearly, New York is not a market that you want to miss out on.”

Other licensees were equally optimistic. 

Wynn Resorts said in a press release the New York state approval, obtained as part of a partnership with the Oneida and St. Regis Mohawk compacted tribes, is the 19th market for its sports betting service, WynnBET.  

“New Yorkers represent a significant portion of the Wynn Las Vegas and Encore Boston Harbor databases, and we look forward to giving those customers more ways to earn and use Wynn Rewards,” Wynn Interactive CEO Craig Billings said in a release. “We also look forward to meeting and engaging with new customers in the state via WynnBET."

Caesars Entertainment, also is a partner with FuboTV for that sports streamer’s Fubo Sportsbook in Indiana and New Jersey. Fubo Sportsbook officially kicked off in Iowa on Nov. 3.

Rush Street Interactive currently operates online gaming in 11 states, including Connecticut and New Jersey. Once it launches its New York Sportsbook, the company said it will be one of only three companies that has online gaming access in all three states. 

Rush Street Interactive CEO Richard Schwartz said in a release that approval from the New York State Gaming Commission validates the company, “the attractiveness of our offerings, and our ability to deliver value and results to our partners. We are pleased to continue our successful track record of securing access in high-barrier-to-entry jurisdictions, gaining market share, and differentiating our platform through the quality of our products, services, and customer service experience."

Sling TV said it has launched the DraftKings Basketball channel, offering subscribers real-time scores and betting odds, with future plans for other channels focused on baseball and hockey. 

The launch is part of an earlier agreement between Sling TV’s parent Dish Network and DraftKings to bring the sports betting giant’s sportsbook and daily fantasy information across the satellite TV giant’s brands. 

"This new channel is just the beginning of how we plan to bring the DraftKings sports betting experience to Sling TV customers," Sling TV president Michael Schwimmer said in a press release. "We will continue expanding and enhancing our offerings to be the ultimate entertainment experience for sports fans."

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Sling TV will also launch DraftKings Baseball and DraftKings Hockey channels in the coming weeks.

"DraftKings continually looks at new ways to reach customers through innovative collaborations with recognizable brands such as Sling TV," DraftKings president of product and technology Paul Liberman said in a press release. "We are thrilled to expand this relationship, which will offer Sling TV customers an entirely new viewership experience through this first-of-its-kind streaming service."

Dish Network said it reached a strategic agreement that will bring DraftKings sports book and fantasy sports to Dish customers.

The DraftKings app will be integrated into the Dish TV Hopper platform. Down the road, DraftKings will be added to Sling TV and Boost Mobile.

The move comes as more media companies form alliances with the growing legal betting industry. Sinclair Broadcast Group, for example, is rebranding its regional sports networks to reflect a deal with Bally’s. 

Dish stopped carrying Sinclair's regional sports networks, citing their high costs.

Legal gambling is dumping lost of advertising dollars into media companies. It is believed that gambling will bring higher ratings and more fan engagement, particularly to live sports games.

"The integration with DraftKings is an exciting enhancement for our customers and a great addition to the growing Dish TV Hopper platform — a one-stop entertainment hub," said Brian Neylon, group president, Dish TV. "We're thrilled to work with DraftKings to amplify the sports-fan experience, and extend the DraftKings footprint across our unique suite of services, including SWling TV and Boost Mobile, with potential applications across our 5G wireless buildout in the future."

DishTV customers with an internet-connected Hopper family receiver will be able to access the DraftKings app to view betting odds and fantasy contests. They can initiate bets or contest entries with DraftKings directly from their TV, then set recordings and watch the live sports that correspond with those bets or fantasy teams, the company said.  

When a bet or fantasy contest entry is initiated, customers will be prompted via text message through DraftKings-created technology to complete the transaction within the DraftKings app on their mobile device. Once launched, Dish TV customers can initiate bets for NCAA basketball, NBA, and NHL from the app via Hopper, with additional features to come. 

"Our deal with Dish TV and the technology behind it immerses customers within a next-generation viewership experience and reaches these fanbases in a completely new way," said Paul Liberman, president of product and technology and co-founder at DraftKings. "This is a unique opportunity for fans to watch games and engage with our real-money products while the technology also allows for further innovation ahead." 

Media networks, starved for new sources of advertising revenue, may find a wellspring of opportunity in the form of sports gambling ads, according to Morgan Stanley media analyst Ben Swinburne.

TV networks such as ESPN, Fox, CBS and NBC are expected to be the biggest beneficiaries, Swinburne wrote in a recent deep dive into sports betting. Fox, especially after it sells certain assets to either The Walt Disney Co. or Comcast and concentrates on live sports and news, could see healthy ad revenue gains, as could CBS, he added.

According to Swinburne’s estimates, the post-deal “New” Fox might generate a 2.1% lift in ad revenue accountable to sports betting this year, with CBS experiencing a 1.5% gain. In a more bullish scenario — where overall sports betting revenue rises more aggressively — Fox’s increase grows to 4.1%, with CBS adding 3.1%.

Swinburne conservatively estimated that legal U.S. sports betting revenue will reach $5 billion by 2025 — or $10 billion in a “bull” case scenario. About 20% of that haul will be devoted to TV advertising spent to lure gamblers.

Seeing the Light on Gambling Ads

Sports betting in the United States has resided mainly in the shadows, but it moved into the light earlier this year when the Supreme Court invalidated the Professional and Amateur Sports Protection Act. PASPA prevented states from allowing legal sports betting outside of horse racing and lotteries, but now each state has the right to pass its own laws legitimizing the practice.

Some leagues, such as the National Football League, have frowned upon legalizing betting for their respective sports, but some states such as New Jersey have already given the green light. Others are sure to follow: Swinburne estimated that 31 states will legalize sports betting by 2023.

Swinburne’s base case estimates predict that paid media will attract about $1 billion in sports betting advertising in 2025 — his bull case puts that figure at about $1.5 billion. Of those totals, TV sports betting advertising is expected to account for about 75%.

Related: Sports Sites Encouraged By Betting Ruling

Other analysts were less optimistic. Pivotal Research Group advertising analyst Brian Wieser said new ad categories are likely to emerge in the wake of the Supreme Court ruling, but he was uncertain of the overall impact.

“It is hard to tell if growth from those categories offsets softness from more mature brands who are either looking to reduce spending broadly or are shifting away from paid media for their marketing activities,” Wieser wrote in a note to clients.

There is ample evidence that TV will be a big beneficiary of sports gambling. In 2015, fantasy sports companies FanDuel and DraftKings spent huge amounts of money to advertise their services, which some considered to be loosely disguised gambling. Both companies pulled their campaigns after several state attorneys general threatened to bring action against them.

Almost immediately after the Supreme Court ruling, DraftKings said it would offer sports betting, and with such legalized gambling expected to become the rule in most states, others are expected to follow suit, and turn to advertising to differentiate themselves.

According to Kantar, FanDuel and DraftKings spent a combined $400 million on ads in 2015, with about 80% of that figure devoted to TV spots. For the second half of that year, FanDuel and DraftKings represented 2% of total domestic TV ad revenue for the networks that carried sports — ESPN, TBS/TNT, ABC, CBS, NBC and Fox — and was largely responsible for the acceleration in TV ad revenue for that year.

Direct sports betting advertising won’t be the only windfall for networks — it could also bring a ratings lift.

Swinburne cited Nielsen data that found adults who bet on the NFL watched 19 more games in the 2015 regular season than adults who didn’t bet at all. And casinos and online betting sites could partner with media companies to improve their competitive positioning. Swinburne pointed to Sky Betting & Gaming, a British online gaming company that improved it share of the U.K. market from 6% to 12% after partnering with Sky TV.

Separately, National Research Group said earlier this year that 79% of current and potential gamblers said they would watch more live TV sports, with 63% saying they would watch a greater variety of sports and 60% saying they would watch sports they didn’t watch before.

The decision by the U.S. Supreme Court to allow states to offer sports gambling services has been anticipated for months, and betting-focused channels like TVG, TVG2 and WinView are ready to pounce on the opportunity. 

TVG and TVG2 (formerly HRTV) focus on horse racing and allow viewers to place bets online, with TVG available in about 45 million homes. Adding other sports like football or basketball to the mix wouldn’t seem to be that difficult.

“It’s a great day for all stakeholders in the sports industry,” said Perform Group CEO Ross MacEacharn in a statement. “This decision gives fans new ways to engage with and enjoy their favorite sports. For betting operators and rightsholders, it presents a unique opportunity to build an efficient, properly regulated betting market from the ground up and design a model for what 21st century betting should be. We look forward to working closely with our rightsholder partners, legislators, regulators and clients to shape the reality of a safe, engaging sports betting environment.”

TVG and HRTV owner Paddy Power Betfair has been trying to crack the U.S. sports market since purchasing the channels’ parent Betfair in 2015. Originally founded in Dublin, Ireland, in 1988 as a string of betting parlors, Paddy Power last year purchased Draft, a fantasy sports app that operates in 35 states.

Also last year, Paddy Power launched Betfair Exchange, an online horse wagering service for tracks in New Jersey, and has similar services in Europe and Australia, where it offers gambling on soccer and rugby matches. Translating that expertise to online and TV betting on football and basketball in the U.S. shouldn’t be that difficult.

Paddy Power Betfair U.S. CEO Kip Levin told Bloomberg last month that not only could TVG handle additional sports betting tasks, the company had plans to build a new studio in its Los Angeles headquarters for a new channel devoted to wagering on football, basketball, baseball, hockey and soccer.

“We’re ready to go,” Levin told Bloomberg. 

Investors drove Paddy Power shares up more than 12% on the London Stock Exchange on Monday. 

But Paddy Power won’t be alone. Other sports fantasy sites and other betting related businesses are expected to crowd the field. Earlier today, fantasy sports site Draft Kings, which had to pull ads on ESPN two years ago after legislators in New York objected, said it would move into the sports betting arena.

"Our mission has always been to bring fans closer to the sports they love and now, thanks to the wisdom of the Supreme Court, DraftKings will be able to harness our proven technology to provide our customers with innovative online sports betting products," said DraftKings CEO and co-founder Jason Robins in a statement. "This ruling gives us the ability to further diversify our product offerings and build on our unique capacity to drive fan engagement."

And ESPN said in a statement that while it is too early to tell what impact the ruling will have on its networks “we are actively monitoring it.”

DraftLings said it has been readying a mobile sports betting platform since 2017 in anticipation of a favorable court ruling. The company said it is working with state regulatory agencies to apply for operating licenses in those states that already allow sports betting.

At WinView, CEO Tom Rogers said his company’s patents for mobile and digital games of skill that users play while watching live sports on TV also could translate into gambling applications.

“These patents govern the synchronization of mobile devices with live television sports among many other elements,” Rogers said in a statement. “These same patents cover gambling and games of chance and we look forward to playing a leading role with mobile technology and other applications as states decide how to implement their individual sports gambling laws as a result of this Supreme Court decision.” 

The Federal Trade Commission was praising the decision byFanDuelandDraftKingsto call off their planned merger.

TheFTChadlast month sued to block the mergerof the online fantasy sports sites.

"FanDuel decided to merge with DraftKings last November, because we believed that this deal would have increased investment in growth and product development thereby benefiting consumers and the greater sports entertainment industry," said FanDuel CEO Nigel Eccles. "While our opinion has not changed, we have determined that it is in the best interest of our shareholders, customers, employees, and partners to terminate the merger agreement and move forward as an independent company.

RELATED: FTC, DOJ Give Liberty-GCI Deal Antitrust OK“The parties' decision to abandon this transaction is a clear win for American consumers,” said Markus Meier, acting director of the FTC Competition Bureau. “For years, the vigorous competition between DraftKings and FanDuel has spurred innovation and favorable pricing. In brief, consumers benefitted from the intense rivalry between the two leading players in this space. If this merger had been allowed to go through, those benefits would likely have been lost.”

DraftKings was founded in Boston in 2012 and FanDuel in Scotland in 2009. They are the largest and second largest fantasy sports sites, respectively. They are both paid daily contests, which the FTC said means that other season-long contests are not a meaningful substitute or that new daily sites can ramp up fast enough to provide sufficient competition.

RELATED: FTC Competition Bureau Chief Tad Lipsky Retires

The vote to approve the suit was 2-0, meaning chairman Maureen Ohlhausen, a Republican, and Terrell McSweeny, a Democrat, agreed.

The suit did not mean there had been any finding of guilt, only that there is a reason to believe the merger violates the law.

The FTC has sued to block the merger of online fantasy sports sites DraftKings and FanDuel.

The FTC, joined by the State of California and Washington, D.C., filed a complaint in federal district court alleging that the combo violated both antitrust laws and the FTC Act.

“This merger would deprive customers of the substantial benefits of direct competition between DraftKings and FanDuel,” said Tad Lipsky, acting director of the FTC’s Competition Bureau, in a statement. “The FTC is committed to the preservation of competitive markets, which offer consumers the best opportunity to obtain innovative products and services at the most favorable prices and terms consistent with the provision of competitive returns to efficient producers.”

DraftKings was founded in Boston in 2012 and FanDuel in Scotland in 2009. They are the largest and second largest fantasy sports sites, respectively. They are both paid, daily contests, which the FTC said means that other season-long contests are a meaningful substitute, or that new daily sites can ramp up fast enough to provide sufficient competition.

The vote to approve the suit was 2-0, meaning Chairman Maureen Ohlhausen, a Republican, and Terrell McSweeny, a Democrat, agreed.

The suit does not mean there has been any finding of guilt, only that there is a reason to believe the merger violates the law.

The daily fantasy sports sites DraftKings and FanDuel on Monday agreed to stop offering paid contests in New York in a settlement with state attorney general Eric Schneiderman. The sites are big TV advertisers and have received investments from prominent media companies (including Comcast and Fox Sports) but have come under fire as essentially gambling sites, and not the games of skill their promoters claim.

DraftKings and FanDuel announced the settlements on Monday as Schneiderman withdrew prior cease-and-desist orders against them, while continuing to pursue claims of false advertising and consumer fraud. The ban is in effect until September, when a state appeals-court ruling is expected, or until the state legislature legalizes daily fantasy sports, USA Todayreported.

Schneiderman has said he believes the two sites are "totally unregulated gambling venues," Legal Sports Report reported. New York is the largest market for daily fantasy sports and some two dozen states are now looking at legislation governing daily fantasy sports, perThe Wall Street Journal.  

Links to the settlements are here and here.

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After spending more than a quarter of a billion dollars on national advertising between August and November -- and forming a significant source of programmers' ad-sales gains in the third quarter of 2015 -- daily fantasy sports sites DraftKings and FanDuel have virtually disappeared from the network TV scene.

Some have speculated that the ad slowdown is because of the pending litigation taking place in several states where the attorneys general are trying to stop those sites from doing business, contending there are not games of skill but illegal gambling. Another blow came over the weekend when, The New York Times reported, Vantiv Entertainment Solutions, a payment processing company that handles a significant number of transactions notified the operators this week that it would stop handling their payments as of Feb. 29.

One TV network executive, though, told Multichannel News that when DraftKings and FanDuel began their ad spending spree prior to the start of the National Football League season last year, they planned to begin with a heavy barrage of ads and then pull back as the season progressed.

“They focused on customer acquisition during the first half of the season, front loading their spending to improve market awareness and build up their customer base,” the executive, who did not want to speak for attribution, said.

That doesn’t answer why the two companies as the NFL season wound down have not more heavily promoted their NBA offerings, which unlike the NFL, has national telecasts virtually every night.

DraftKings and FanDuel, which invested a combined $260 million in commercial time on five networks from August through November, have only spent a combined $4.2 million since, with a small chunk of that in National Basketball Association telecasts, according to data from research firm iSpot.tv.

The networks that reaped the benefit of the massive ad campaigns – CBS, NBC, ESPN, Fox and Turner – all declined to comment on their ongoing discussions with DraftKings and FanDuel regarding their ad plans going forward. And attempts to reach the two advertisers were unsuccessful.

“The legal stuff has everyone nervous,” the network executive who did not want to be identified said. “Everyone wants to lay low. It’s a thorny situation. There’s no reason to talk publicly about advertising plans right now.”

DraftKings and FanDuel are not exactly lying low, though. They might be advertising much right now, but both seem to be laying out plans for more ad spending in the upcoming months. DraftKings earlier this month hired Janet Holian as its new global chief marketing officer, and FanDuel signed a multi-year licensing agreement to feature NFL players in future marketing campaigns. Those moves seem to indicate more ad spending is on the horizon.

While it lasted, the spending spree in the second half of last year was one of the most concentrated periods of advertising by two advertisers in TV history. Data from iSpot.tv shows DraftKings and FanDuel outspent the entire beer industry in the month – Aug. 16 to Sept. 15 -- leading up to and including the NFL’s start of the season. 

They also outspent the entire retail pizza category during that same period, spending more than the $45.7 million invested on national ads by the pizza chains.

iSpot.tv data also shows that between Aug. 24 and Sept. 13, the two fantasy games brands together aired an ad on national television every 90 seconds. On Aug. 31, they combined to air 1,285 commercials, nearly as many ads as minutes in the day (1,440).

Between August and November, DraftKings spent $123.4 million on national TV ads, according to iSpot.tv. FanDuel spent $136.5 million. Since then, DraftKings has spent just $3.1 million, while FanDuel has spent $1.1 million.

Where were the dollars spent? DraftKings spent 44.6% of its budget or $56.3 million during NFL game telecasts, while FanDuel spent 63% of its budget or $87.2 million during NFL games, iSpot.tv data shows. 

NBA games since the start of the season have gotten just $3.2 million from the two combined.

DraftKings also advertised in the 2015 PGA Championship on Fox and on college football, per iSpot.tv. Most of its ad dollars were spent with ESPN, Fox and CBS. FanDuel also bought ads during college football and ESPN’s SportsCenter, with most of its dollars spent on CBS, NBC and Fox.

The ads more than likely accomplished the mission of increasing consumer awareness. Between August and January, DraftKings generated 8.4 billion impressions on their ads, with an average view rate of 84%, according to iSpot.tv. FanDuel generated 7.9 billion impressions with an average view rate of 81%. And of all those impressions for both, 75% were viewed live.

As FanDuel and DraftKings continue to try to convince New York’s Attorney General they are skill-based entertainment instead of games of chance, the loss of their substantial ad dollars could hurt cable and broadcast networks that have come to rely on the daily fantasy sports sites for ad revenue.

New York State attorney general Eric Schneiderman sought an injunction against both FanDuel and DraftKings from operating in the state, claiming the daily fantasy sports companies are basically illegal gambling sites. Both FanDuel and DraftKings have argued that they are skill-based entertainment, which would exempt them from regulation.

While the sites take in millions of dollars from fans that pick players for cash and can win money based on their game performance, TV networks have been a major beneficiary of the intense ad campaigns of both FanDuel and DraftKings. The ads, touting six-figure pay days won by some players, have peppered cable and broadcast networks for months.

According to Sanford Bernstein media analyst Todd Juenger, daily fantasy sports made up about 50% of cable networks advertising gains in the third quarter, or $134 million out of a total gain of $227 million.

In his research report, Juenger said the fantasy football category spent more ad dollars on sports networks than beer companies. That could mean that their potential ban would put a serious dent in ad revenue.

“Daily fantasy sports sites may not even exist next year. Even if they do, the probability that they grow, again, at these rates is very low (impossible?),” Juenger wrote.

Sports-centric networks like CBS, Disney and Fox received the most form the category, Juenger wrote.

In a separate note to clients, MoffettNathanson media analyst Michael Nathanson, using data from Kantar Media, wrote that Fox reaped $24 million in fantasy sports ads in September alone, followed by CBS ($21.5 million), NBC ($21.3 million) and ESPN ($17.9 million).  Nathanson noted that non-sports networks also received a fair amount of fantasy football ads, with DFS investing over $1 million in advertising on each of 13 broadcast and cable networks during the month.

Nathanson noted that DFS ads accounted for between 4% and 7% of total ads at networks like ESPN2, Fox Sports 1 and Fox. According to Nathanson, Draft Kings spent about $65 million in ads in September with FanDuel shelling out $53 million for a combined $118 million or 3% of total ad revenue.

The presence of DFS in expensive NFL ad time slots helped tighten the scatter market in September and driving up prices, Nathanson wrote. While not as large as other ad sectors like autos, films or health care, the analyst said that the new category was incremental to the market and was a factor in the revenue increases in the period. He added that looking forward, networks should be “concerned” if the government decides that DFS is essentially glorified sports betting.

“Killing the golden goose of DFS would definitely be against the interest of the NFL’s network partners,” Nathanson wrote.    

Just four months after attracting a $70 million round of financing from a handful of media investors, including NBC Sports Ventures and Shamrock Capital Advisors, fantasy sports startup FanDuel more than quadrupled its revenue in the fourth quarter, reporting sales of $36.8 million.

Privately held FanDuel announced the quarterly financials on its website. Founded in 2009, the fantasy sports league site has grown annual revenue from $1.2 million in 2011 to $57.3 million in 2014.

The fourth quarter performance was four times the $8.8 million in revenue FanDuel generated in the third quarter and five times the $7.4 million it generated in the fourth quarter of 2013.

FanDuel also nearly doubled its number of "paid actives" (its paid user base) in the quarter to 1.01 million from 519,310 in the third quarter.  

FanDuel claims to control about 80% of the daily fantasy sports market, which it valued at about $4 billion. Along with its chief competitor – private equity-backed DraftKings – the companies allow customers to compete in daily or weekly tournaments, instead of the season-long leagues normally associated with the genre. Players compete for cash prizes. In the fourth quarter, FanDuel said it awarded $333.9 million in prizes and says it has paid out about $600 million in prizes to date.   

Comcast Ventures, the venture capital arm of Comcast, was one of FanDuel’s first investors, as part of a group that included Pentech Ventures and Bullpen Capital, which pumped $11 million into the company in 2013.

In September, a group of existing and additional investors, including NBC Sports Ventures, Shamrock Capital Advisors (the investment arm of the Roy E. Disey family) and venture capital legend Kohlberg Kravis Roberts, invested a total of $70 million in the company.

Fantasy leagues are gaining in popularity, especially single-day and weekly sites that more resemble gambling. FanDuel got an added boost in November when it reached a four-year deal with the National Basketball Association to be the only daily fantasy site on the NBA website. The NBA also is an investor in FanDuel.

While Comcast was in on the ground floor with FanDuel, other cable properties have been eyeing the sector, including ESPN. According to a report in Sports Business Journal earlier this month, ESPN is weighing a move into the segment as early as next football season.

DirecTV, with its exclusive National Football League package NFL Sunday Ticket, also is reportedly looking into a possible partnership and launched a Fantasy Sports channel (DirecTV Fantasy Zone) in 2014.