I would think spending time and money watching millionaires wearing shiny spandex pants give each other brain trauma in billion dollar stadiums paid with our tax money makes us suckers regardless of the existence of Fantasy Football.
I bet you think you're clever with this dismissal of sports and that nobody who actively enjoys sports is aware of the objective nature of what's going on.
I used to really hate sports, and make fun of people. It took me a long time to realize i was just an alienating asshole. While not really my thing, i try to put in a tiny bit of effort to be aware of what's going on in sports, and it's improved casual relationships a lot. That said, taxes for stadiums is a pretty bad idea.
it's hard to quantify, but just my general attitude has made things smoother. Rather than rolling my eyes and trying to change the subject, i'll try to listen attentively and engage if i have something to contribute.
I don't have any interest in listening to someone rattle on for hours, but a minute or two listening to something they're excited about, well, it goes a long way. A reply like "I'm not much of a sports fan, but that sounds amazing" is pretty effective. Just let people bask in the glory of whatever they love for a moment or two, sports, tv shows, how smart their kid is, vacation pictures, whatever.
I guess, i wouldn't talk to people if they weren't important or interesting in the moment in some way, taking an interest in what they find interesting makes me feel more connected somehow.
I always have to preface these opinions with "I used to work in the industry" (I was a developer for a site that got acquired by one of the 2 outfits mentioned), so take this with a grain of salt:
This guy was destined to be a sucker. It's not that DFS turned him into a sucker, it's that he has a gambling problem - he says this in the beginning of the article! Why do we need to read further, it's pretty clear from that statement alone he's not going to do well in the long run just knowing the psychology of a gambler like that.
And to be frank, he isn't very smart with his money either. He's doing a lot of things that are increasing his risks and destroying his bank account which could be fixed with some simple statistics and discipline (which, for someone with a gambling problem, would be almost impossible).
The way to not lose money like the author is employ many of the same tactics you would with investing:
* Put in only what you can afford/feel comfortable losing
* Stick with the Kelly criterion[1] and never bet more than 10-20% a day
* Diversify - instead of 1 $20 H2H game like the author, play 10 $1 H2H games and 10 $1 50-50s. Now instead of flipping a coin once to make $40 all or nothing, you get to flip a coin 20 times, and each win gets you $2, which can mitigate some of your losses.
Now to be fair, that last example is a bit inaccurate - because each coin flip is not an independent flip like in a true coin flip, because if you use the same lineup, and that lineup performs poorly, it's like having a weighted coin severely against your favor, but at least with H2H matchups, you know that some people can bomb worse than you, whereas in 50-50s, since you only have to do better than half, in a large sample size, you likely won't win any of your 50-50s since the median score is roughly the same across all of them.
My point is two-fold:
1. DFS doesn't turn people into suckers, they already were suckers/gamblers and didn't do their homework and practice discipline, which brings me to my next point...
2. DFS is a game of skill - for an exaggerated example, it takes a basic level of competence to choose Tom Brady over his backup, Jimmy Garoppolo. You can be almost certain he will play, as he's pretty much played every game in his career except for an injury nearly a decade ago. But DFS is also gambling. We know it is, but saying it's legal gambling won't bring on new customers. It takes a lot of work to say "100% Legal" all over your site and still not have people sign up.
The US is a funny country. We don't legalize online poker but we legalize in-person poker in casinos all across the country. We legalize DFS but not online poker. Where is the logic in this?
For the HN crowd, if you want to try it and you like sports stick with the above advice: don't play if you have a proclivity for compulsive or irresponsible gambling. Don't put a lot in (and only put in funny money, nothing you would otherwise use for say, your mortgage), and exercise a bit of statistics and probability theory so you mitigate some of the risk. If you do that, you won't become a sucker.
The problem with doing 20 small bets vs. one large one is your almost guaranteed to lose on a given day. You are much better off making 1 bet per year and then stopping, than lot's of little ones. EX: I am up over my lifetime on slot machines. How? I did a few bets on a fixed amount got slightly lucky and never played again.
That said, if your doing this for entertainment then minimizing the money your betting is reasonable. People making 100+k per year can get really competitive over penny poker.
Not sure I understand the math behind your logic - unless you're assuming that you spend an entire year researching that 1 bet to have the best odds. In DFS, that would be like spending the entire off season researching Week 1 stats, so that by game day, you play 1 giant tournament hoping for a big payout, and then not playing the rest of the year.
That still seems to be dangerous because you have no diversification, in lineups or allocation of funds. Would be curious to understand your reasoning more.
Edit: Diversification works with investment when the average return is positive.
These games are negative sum for most players as the house takes part of the pool. For simplicity, let's say it's a 50:50 coin, but you win 1.99 of your stake. With one bet the house takes some of your winnings, but your odds don't change. With 2 bets, if you win both you win, if you lose both you lose, but if you win one (1.99) and lose one (0) you still lose (1.99 + 0) / 2 < 1.
Sure, your odds of losing 'big' went from 50% to 25%, but your odds of winning big went from 50% to 25% and your odds of losing slightly are now 50%. Same thing applies if it's a 10% chance to win 9.99x your state, with 10 bets and 1 when you still lose. However, your odds of a 9.99x win are much smaller. (1 in 10,000,000,000 vs. 1:10)
Granted, if your vastly better than other players you can get a small advantage. But, that's not going to be very significant over a small number of games.
(Odds of winning * 20 bets * $1) has exactly the same expected outcome as (odds of winning * 1 bet * $20), assuming the odds are the same in the two brackets, but the difference is in the latter category you get to play 20 times.
The list of possible outcomes changes, but the expected outcome does not.
2x winnnings * 50% chance of winning * 20 games * $1 per game = expected outcome $20
2x winnings * 50% chance of winning * 1 game * $20 per game = expected outcome $20
Your fuzzy logic around "winning big" "losing big" etc doesn't change the basic math of the expected outcomes, which is simply (chance of a thing happening) * (result if it happens).
These are not even games; the expected value is < 1. That said if you like playing then the actual math is almost meaningless. Nobody complains about not breaking even when going to the movies.
With one game you never actually end up with ~20$. It's either 0 or ~40$. Expected value is close to break even, but you get an actual bet going.
With 20 games you never end up at 0 or ~40$ it's 'always' (524,287/524,288) something between those extremes. However, with negative expected outcome games the average case is bad, so you odds of winning are less than 50/50 and your average win is tiny.
Further, many people play not just a fixed number of games, but keep playing until there stake is gone, which tends very strongly toward zero.
Net result, if you play just one game you have a reasonable chance of winning. If you play lot's of games you most likely will keep losing money until you stop.
PS: This is why most casinos don't take big bets; they make far more money from people making lots of small bets over time.
If you assume that the odds of winning are the same, the payoff ratio is the same, and that you don't play again with anything you win, then the expected results are exactly the same.
If someone is going to keep playing with their winnings, they're likely to do so either way.
EV is not the only number, your describing an average and the standard diviation is important.
Ex: if you have a slight negative bias say 50:50 to win 1.999x and play a trillion games your going to flat out lose money with Effectivly zero % chance of winning.
But if you play 1 game with a trillion times the bet, you have a 50% chance of walking away with 1.999x your bet, and a 50% chance of walking away with 0. So about a 50% chance to nearly double your bet, and a 50% chance to lose. Whereas with a trillion smaller games you'll probably end up at about 0.999x your starting money, which is the same on average.
Just because someone is predisposed to an addiction doesn't mean that you as someone that interacts with this person doesn't have any responsibility in that situation.
For instance in many places bartenders are bound by law to not give more alcohol to people that are already drunk.
The biggest problem I see with gambling is that the Pareto effect shows an ugly face there: often it's just economically feasible for the operator because of the addicts.
Bartenders are bound by law not to give drunks more alcohol because they could go drive a car and kill someone. A gambler is only hurting himself when he loses his money.
That is not the reason bartenders are not supposed to give drunks more alcohol. If the person is already drunk and the bartender refuses to give them more, do you think that would encourage the person to remain at the bar or leave?
Why do you think heroin or meth are illegal? Those substances are only hurting the person using them, right?
Or they might lend some money without being able to pay it back. Or they might steal money.
But in my opinion the harm an addict can do to others isn't even the only problem. Addiction is a sickness that needs treatment and help. Addicts are victims first (at least partly of themselves) and only then can also be perpetrators.
Living off the problems of other people (by enabling them in their addiction, not by helping them) to me personally is morally questionable. It might be a bit of a cultural thing though, as here in Europe there isn't as much emphasis on the idea that everyone needs to take their luck in their own hands as there is in the US.
Sure, I agree. I also think gambling is a health problem.
I find your last paragraph interesting. I too, am European. But there are lots of cultures in Europe. To me, the word "responsability" struck me as being very strong.
As a portuguese, we are sociably incentivised to help each other out but it usually goes as far as helping a "friend of a friend". We have almost a "helping out" economy, that I believe comes from the hardships from our parents and grandparents during the middle of the century. And it's how we make bonds with each other.
But when someone can't or doesn't want to help, it's OK. The way you phrased it turned a "could do" and "might do" to a "must do".
The problem with gambling is, there are so many other readily available alternatives. Yes, DFS could maybe cut him off if he loses "too much", though how we define that is too difficult. If a guy who makes $50k a year loses $50k, that's probably too much. If Mark Zuckerberg does it's not. DFS sites surely can't be expected to know your financial situation.
But anyway, suppose they could. There's always the world's biggest casino: the stock market. Or there are actual casinos. Or there are lottery tickets.
In most gaming jurisdictions, casinos are required to pay for billboards and the like advertising where a problem gambler can get help. (The lotteries, which are state run, never do this, and Wall Street sure as shit doesn't.) I'd have no problem with those sites putting link to Gamblers Anonymous on every page.
But beyond that, I don't think they have responsibility.
Hey mattmaroon, I just noticed your comment here. I was thinking of you specifically when reading this article. I could have sworn you were talking about daily fantasy 7 or 8 years ago, back before it was "a thing".
I'm curious, did the market play out like you thought it would? Is this about where you expect daily fantasy will end up, or are there still big changes ahead?
This is exactly where we thought it would go when we started Draftmix. It is very much like them, except we did it over 8.5 years ago. (We were in YC summer 2007 and had been working on it before that.)
It is a shame we weren't the ones to have gotten there. I would have learned some lessons from the rise and fall of online poker that the DFS guys don't seem to have.
"The biggest problem I see with gambling is that the Pareto effect shows an ugly face there: often it's just economically feasible for the operator because of the addicts."
I'm addicted to Hackernews. Does the fact that it's a free site make the operator any less responsible?
How about we just make everyone personally responsible for their own actions. Gambling addicts can just block the website.
Bartenders have a responsibility not because of addiction, but because someone could actually kill themselves or others when they are too drunk.
I also don't see the medical marijuana dispensaries responsibly for people that ruin their lives due to MJ addiction (yes, I know that it's not chemically addictive, but like gambling, you can get addicted to it).
My advice for the non-HN crowd (which these sites are clearly aiming for in their carpet-bombing advertising on sports channels):
If you want to play fantasy sports, play one of the free non-betting sites that have been around for years. The new DFS sites you see on ESPON are full of sharks that will eat you alive.
On a meta note: it's funny to contrast the NY Times coverage of DFS with ESPN's. I think the NY Times is doing a public service here. Although it probably largely goes over the head of the audience that would most benefit by it, it has already clearly filtered in the larger public debate.
Meanwhile, I actually saw front-page coverage a few weeks ago of a protest by DFS advocates against the Attorney General's decision to reign in DFS sites. I wonder who even organized that protest.
Along with the broadcast advertising partnerships, DK and FD also have significant financial partnerships with many of the major sports leagues (NFL, MLB, etc.), which makes things a little awkward.
It's not though. As a kid I had a habit of trying to get out of putting my seat belt on. It was uncomfortable and I didn't understand at the time why I needed to be uncomfortable when I could stretch across the back seat without it. It just so happens that not wearing seat belts is something that society (at least in the US) has dictated that one must be protected from doing. I learned that as I learned other things growing up and accepted it and moved on. Granted I can understand and decide now to wear a seat belt myself, but it's still a behavior that society has decided we needed legislation on.
I'm sure somebody can point to a flaw of mine and say we need to regulate that, and they very well might be right. If I'm particularly obstinate about the topic I might resist, but that doesn't mean that it isn't something that should be legislated. That being said, I'm not calling for widespread legislation to protect us all from our problems, I'm just pointing out that it is a valid opinion to desire more government regulation on personal behaviors. Although it is an uncommon opinion.
I don't agree with seat belt legislation any more than gambling legislation. That's not to say I don't understand statistics or the arguments behind wearing seat belts--I just feel that it's an encroachment on personal liberties.
Risking all of my money (or more) on a big gamble is one of the liberties I not only am glad to have, but have exercised in the past, including becoming a professional poker player, starting a bar business, buying a large property, and riding a motorcycle.
I dislike that I'm required to wear a seat belt, and even more than that, I dislike that other people get to demand it of me.
What makes the seat belt analogy shaky is that society pays for the people who don't wear their seat belts in the form of 1. increased insurance premiums and 2. increased health care costs, both of which are spread over the entire population, those who wear and don't wear seat belts. If you don't wear your seat belt, and hurt yourself, that comes out of my pocket. Society has the right to keep those costs down and collectively decided the best way is to ban this costly behavior.
It's a bit harder to argue that there is a great cost of gambling that is spread across society, however I'm a poker player myself so a bit biased.
A problem with that argument, of course, is that it leads down the path of banning everything that's risky and where society shares the downside. We don't want to do that, so society picks and chooses the highest risk (or worst downside) activities to ban.
Like I said, I understand the arguments for seat belt laws. What makes them a little shaky is we're again picking an arbitrary thing to police. All kinds of things that I can legally do also take money out of your pocket, including many of the things listed above. Motorcycles are a great example in the same niche. In my state we don't even have to wear helmets, it's our choice. I'm guessing the average consequence is a lot greater than skipping a seat belt.
We've picked seat belts as the one to police, probably to give a lot more leeway to police to pull people over and generate income.
Anyway, you say society has the right, and I'm not sure I agree, at least in the seat belt example. They have the power, sure, but I don't think they (ought to) have the right.
His point is we're picking and choosing when and how to interfere with peoples' destructive behaviors.
My mother is allowed to be a drunk, nobody cares how it impacted my childhood. I'm allowed to have trust issues, though it impacts my relationships. I'm allowed to overeat though it might impact my childrens' view of obesity, likelihood to be obese, and finances if they have to support me later. Etc etc.
We've chosen to not allow people to play poker online, to protect them from themselves, but it's a rather arbitrary thing to choose, especially given all the other ways they can destroy their finances.
We can't protect everyone from being exploited in every manner, and it could probably be argued that we ought to quit trying in a lot of cases. IMO it's generally not our place to protect people from themselves.
But when someone goes out to gamble/play DFS, they aren't looking to diversify their bets in order to minimize their chance to lose. The base use case is "Hey, I have a few bucks, I'd like to place a quick bet for kicks, and maybe I have a chance to beat some other like-minded folks". Before DFS, you'd just grab your buddies and make an impromptu bet, and that's that. The implicit expectation is that you're playing with other players like you. And that is precisely what the DFS advertisements promote: you are expanding your pool of for-fun players by orders of magnitude. I'm going to the site, kicking in a $20 every few weeks, for the entertainment and possibility of winning. I'm not going to make 20 $1 bets because that isn't...fun.
The disconnect comes from the fact that DFS pit you directly against top-ranked high-rollers, who are not just schmoes off the street. Sure I don't expect to win. But I also don't _expect_ to be playing top 25 players in the world who are playing with thousands of bets.
That issues is covered in depth by the article, but from the looks of your post, you just seemed to stop reading after the 'gambling addict' bit. The last paragraph covers this:
"At the start of the N.B.A. season, a couple of friends and I started a friendly league on DraftKings. Every night, we draft teams, watch the points accumulate and make fun of one another for our picks. On the first of each month, we pay one another what we owe. One of these friends creates N.B.A. player performance models. They help him escape the cynical demands of his job as a corporate lawyer. To date, I am down $350 to him.
“Yes, yes, yes,” Harber said when I told him about this league. “That’s how it’s supposed to be.” "
You should also preface the opinion with "I didn't read the whole article".
The very fact that he ADMITS he has a gambling problem up front should have been a clue that the article was going to be about something other than whining about losing money (which he never actually did).
He's outlining the ways in which the sites are corrupt.
So the problem with this gambling site, which defends itself as being a game of skill, is that some players are far more skilled than others and so win regularly. I see.
His point is that currently in the US "games of skill" are legal where "games of chance" are not. Fantasy is legal because it is classified as a game of skill where black jack is not.
In reality, success in most games comes from a combination of luck and skill. Part of "skill" is dealing with and capitalizing on the randomness of "luck".
In practice, who typically ends up drawing this distinction? Appellate judges?
The skill you point out is also generally luck, the only time skill comes into play is when you're doing something that the casino will kick you out / stop offering those terms
It's also misleading since in, for instance, blackjack, even when you play at the highest (casino-allowed) skill, you will lose. That's not true of poker or DFS.
There's still plenty of nuance (luck prevails in the short term while skill prevails in the long term).
Fantasy is legal because of this text of in the UIGEA
`(D) does not include--
`(ix) participation in any fantasy or simulation sports game or educational game or contest in which (if the game or contest involves a team or teams) no fantasy or simulation sports team is based on the current membership of an actual team that is a member of an amateur or professional sports organization (as those terms are defined in section 3701 of title 28) and that meets the following conditions:
`(I) All prizes and awards offered to winning participants are established and made known to the participants in advance of the game or contest and their value is not determined by the number of participants or the amount of any fees paid by those participants.
`(II) All winning outcomes reflect the relative knowledge and skill of the participants and are determined predominantly by accumulated statistical results of the performance of individuals (athletes in the case of sports events) in multiple real-world sporting or other events.
`(III) No winning outcome is based--
`(aa) on the score, point-spread, or any performance or performances of any single real-world team or any combination of such teams; or
`(bb) solely on any single performance of an individual athlete in any single real-world sporting or other event.
counting cards in a casino or professional setting will get you blacklisted and thrown out of said casino. the preventative measures against card counting are extensive, to say the least. Your example still works, but it's not applicable in America, where the daily sports issues arise.
Not a great example with the motorcycle, but I agree. There's a difference between people who exploit the architecture of the game vs. people who automate sophisticated strategies.
An interesting parallel would be the HFT "market-makers": I could argue that's exploiting the architecture of the markets, not "playing the game".
The problem is it's a motorcycle race and you're on foot the only thing is you're so bad a math you don't even realize you're in a motorcycle race.
This is the same issue that people have with card counting, wheel spin analysis, prng analysis, hft, dice throwing, etc. People who are good at math use that skill to make games of skill of what people incorrectly believe are games of luck.
Rich people always get upset when they think they are fucking over someone dumb when really they are getting fucked over by someone extremely smart. Then they write articles about how unfair it was that they were too dumb to realize the game wasn't rigged how they intended to rig it.
Hence we end up with articles like this, that it's 'unfair' that the author is a poor gambler and repeatedly accepts wagers that are not in his favor. He even made a spreadsheet of how dumb he is and then refuses to accept the math that proves he's dumb.
You're not wrong, though there's more than that. I never understood the "game of skill" argument, though. Pure gambling (e.g., flipping a coin) has no skill whatsoever. Due to the chaotic nature of the world, nothing is pure skill (simple commerce, e.g., still has small risk). Poker, online sports, etc. has an element of skill to it, but also an element of risk. I can run endless statistics on blackjack hands to improve my odds of winning, but they're still odds. In the same way, DFS power players can have a massive advantage, but if Tom Brady breaks his collarbone in the first quarter, it's still luck. You are gambling that your skills are better than the other guy's (and the chaotic nature of the universe won't screw you).
I think DFS fails in two ways:
1. Corruption - All the stories in the last 6 months about FanDuel employees using insider knowledge to gain an edge on DraftKings, for example. That is screwing the fan, pure and simple.
2. Creating a Predatory Environment - The issue here is allowing power players to "rape and pillage regular players". In the same way that I'm not going to enter the WSOP, I'm going to have a much better experience playing against those at my skill level.
You could probably throw "false advertising" in there, too, but we'll let the FCC deal with that.
You're missing the corruption of the game angle as well. Fantasy sports is worse than most forms of gambling because the scope of stakeholders is so broad.
With lots of legit, liquid money in play, it doesn't take a rocket scientist to figure out that you can corrupt players and coaches to massage the stats, or those same players and coaches can participate through proxies.
With horse racing, which is the closest thing to this stuff, there are a few different sets of stakeholders with different interests. Owners, trainers and jockeys who are cheating are pretty easy to identify.
End of the day, you're better off trusting the dice.
If you can submit multiple lineups via scripts, how can they not detect this? Do they use multiple accounts? Or is it just a desire to look the other way by the companies?
> Or is it just a desire to look the other way by the companies?
That's certainly what the article is implying:
> D.F.S. high rollers similarly come with demands, and because there’s no powerful regulatory body involved, DraftKings and FanDuel have been mostly free to set the parameters of play, which, as it turns out, is near anarchy, especially for the D.F.S. elite. High rollers want to be able to use third-party computer scripts that will allow them to enter thousands of lineups at once, something that your average player cannot do. High rollers can gain access into D.F.S.’s inner circle, in which they get to be on first-name, texting basis with executives and employees at DraftKings and FanDuel. They can operate under the cover of plausible deniability — if other players complain that the high roller has been using tools that destroy competitive balance, he might expect the sites to stick up for him.
It'd be a game of cat and mouse. They would simply start multiple accounts, start using proxies, different computers, etc. Poker had this problem online. It was a bigger problem for poker though because in DFS, there's no real edge from multi-accounting. You don't get extra information like you do in poker. It's just that a sucker in DFS is getting raked that much more.
It does threaten the long-term viability of the game though. Newbies are going to come in, get fleeced, and quit.
How do you keep getting paid in a system like this though? It seems to me like it'd be a lot easier to come up with 100 FanDuel accounts than 100 bank accounts, mailing addresses, credit card numbers, etc. to get paid with.
What I used to do when bonus abusing online casinos (not poker) is get people to sign a limited power of attorney form and give me a copy of their ID, for a small fee. I would photoshop fake addresses into utility bills as address verification. I would then buy in and cash out to a method that allowed some form of transfer. Back then it was PayPal or Neteller.
I am not as familiar with DFS, but I am sure it is doable, and there is enough money on the line to make it worth doing.
For one, it's a website. How do they detect legitimate traffic vs scripted traffic? There would be countless ways to hide the fact that the traffic is scripted. Think about most sites -- they're barely able to keep the things running, let alone add on an additional huge workload of fraud detection...
> The difference between the D.F.S. high roller and the blackjack whale, of course, is that the whale is trying to take millions from a multinational casino corporation and not from the honeymooners from Fresno who are betting away at the $5 tables.
I don't understand this bit. What's the difference? The casino is taking money from those honeymooners; and it's paying it out to the whale. The whale negotiates rules that are different than those that apply to the honeymooners. How is this different than the DFS whales?
Is the only difference that FanDuel/DraftKings allow players to engage in one-on-one challenges, vs. playing against the house?
Generally, but not always. An article in The Atlantic a few years back explained how one whale took a trio of casinos for $15M:
Johnson did not miss the math. For example, at the Trop, he was willing to play with a 20 percent discount after his losses hit $500,000, but only if the casino structured the rules of the game to shave away some of the house advantage. Johnson could calculate exactly how much of an advantage he would gain with each small adjustment in the rules of play. He won’t say what all the adjustments were in the final e-mailed agreement with the Trop, but they included playing with a hand-shuffled six-deck shoe; the right to split and double down on up to four hands at once; and a “soft 17” (the player can draw another card on a hand totaling six plus an ace, counting the ace as either a one or an 11, while the dealer must stand, counting the ace as an 11). When Johnson and the Trop finally agreed, he had whittled the house edge down to one-fourth of 1 percent, by his figuring. In effect, he was playing a 50-50 game against the house, and with the discount, he was risking only 80 cents of every dollar he played. He had to pony up $1 million of his own money to start, but, as he would say later: “You’d never lose the million. If you got to [$500,000 in losses], you would stop and take your 20 percent discount. You’d owe them only $400,000.”
Right, it happens when a pit boss or marketing department makes an error. It's not something they do on purpose. There are lots of stories of people flying in from around the world because some casino was dumb enough to pay double odds on 00 on roulette or something.
This could also be done on purpose occasionally as a money losing promo in order to bring in new long-term customers. Casinos have insane LTCV so it might make sense sometimes. In this scenario it would be the classic groupon problem where you get taken advantage of by 'deal hounds'
The idea here is that the casino will be more diligent in not tilting the odds too much in favor of the whale, because it's the casino's money that is going to be lost to a game tilted in the whale's favor.
The argument is that in DFS because the whale is winning "other people's money" well then it's not as bad in the company's view.
But obviously the supply of "fresh meat suckers" is a corporate resource of the company's that is being exhausted by too much whale fleecing... so they still police it to an extent, but just not as much.
Trust me, it isn't the "Casino's money" it is always the other players money. At its most simplest, people come into the Casino and drop money on the floor, the Casino collects it, and then randomly gives some of it to people as they exit. It preferentially (by giving a higher probability) gives money to people who have come in a lot and have dropped a lot of money on the floor. At no time is there any risk that the Casino won't keep all of its "fraction" of the dropped money.
>The idea here is that the casino will be more diligent in not tilting the odds too much in favor of the whale
Allowing scripted entries is one of the biggest examples of this and a huge differentiator between DFS and casino games like poker. You will very rarely have an absolute poker novice playing against a skilled shark. The novice will generally know they are a novice and will enter lower stake games. The shark's time is money and they will only enter games with high enough stakes to merit playing. This is completely different for DFS when scripting is allowed. The sharks can play an almost unlimited number of games against any opponent. If it is completely automated, there is no reason why the shark can't challenge the complete novice who is only willing to bet $5.
Regardless of the semantics, I think you're missing the point of what he's saying. His overall argument is that DFS is more similar to casino blackjack than it is different.
Poker is a better analogy then. You don't play against the house's money there, just the other fella's. DFS, from the article, is best played profitably by whales if there is bumhunting of the newbies. Not only, but the best way to generate cash and minimize the time to do so is to play newbies. DFS is not strictly predatory, but if you are not playing as a predator in the big sites, you are going to loose all your money.
This is gambling. Not strictly defined as such, but if it looks like a duck, walks like a duck, and quacks like a duck, guess what?
How is it gambling? The same guys with the skills consistently win? Elements of luck, sure, but the fact that the predators exist in the game demonstrates that it isn't gambling.
There are professional bettors who make money on horse racing (eg: Alan Woods). They look at historical odds of horses, jockeys, weather conditions, track conditions etc and like these 'predators' on DFS use models to predict probabilities of runners winning. When the estimated probability of the horse winning exceeds the estimated final public probability by the track take, they bet, and bet big. Lots of data, lots of modelling, algorithmic, lots of domain knowledge, and fully automated. No need to scrape websites, totes will supply the latest odds take their bets programmatically.
Do you consider betting on horse racing as gambling? To be honest, for the professionals placing bets in this way, I don't (keep in mind it's very very easy to incorrectly place yourself in this category, and you will lose). But the vast majority of people betting on DFS do not, and can not, take this approach. For them, horse racing and DFS are very much gambling.
Not if you tip the odds in your favor by counting cards. Not illegal by any means, but you have to make sure you're covert enough about it that you don't get kicked out by the casino.
You're misunderstanding. I'm not taking a stance on whether this is an accurate analogy or not. I'm just stating that the OP is misinterpreting the author's thesis by nitpicking a small point the author make's out of its context. Reread the article, then look at the point OP is making in the full context.
That's very incorrect. The reason it's different is that the honeymooners from Fresno lose (or win) based on the house playing blackjack with a known set of parameters. If the honeymooners play perfect blackjack (which is a game of chance, not a game of skill), the expected outcomes can be calculated.
If the whale negotiates the odds in his own games, he's changing the expected outcomes in his games versus the house, but he's not altering the odds for the honeymooners.
He might win physical dollars that were lost by the honeymooners, but because both players are playing the house, it's meaningless 'whose' money he's winning. He's taking money from the Casino's profit margin, really. They're gambling that he'll still lose more than he wins, and the slimmer margins will be made up in volume.
DFS is a skill game both in player selection, AND in skirting the rules, AND in getting the 'house' to tilt odds in your favor -- which directly tilt the odds even further away from the other players.
You're misunderstanding. I'm not taking a stance on whether this is an accurate analogy or not. I'm just stating that the OP is misinterpreting the author's thesis by nitpicking a small point the author make's out of its context. Reread the article, then look at the point OP is making in the full context.
"Whales" are rich guys who are addicted to gambling and lose a ton of money at the casino. Casinos love whales and will try to track them with rewards cards and lure them into their casino with huge upfront losses (free shows, food, drinks, entertainment, airfare) because they know they'll make it up when the whale starts to gamble. Once a whale starts to bend the rules at a struggling casino too much to win money on average, he stops being a whale and starts being a huge liability.
The only people who win money (on average) at casinos are "professionals" who play games against other players rather than strictly against the house - poker being the prime example. Many poker pros will hang out at "amateur" tables and pose as suckers to draw in less experienced players, then hustle them.
So ultimately the casino does not redistribute money to the whale - it reaps money indiscriminately due to its "house edge" on every game and slot machine.
Here's a breakdown of the house edge and std deviation for a bunch of different games [1]. Craps and blackjack have the smallest house edge due to historical rules of how the games are played, whereas games such as slot machines have a high house edge as the casino can tailor the software that determines the payout. For example, slot machines in Nevada are only legally required to pay back 75% to players on average while the rest goes to the house - a true gamble for suckers. [2]
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The article implies that DFS is different because FanDuel and DraftKings are unable to implement strict rules that collect from players indiscriminate of size.
D.F.S. high rollers similarly come with demands, and because there’s no powerful regulatory body involved, DraftKings and FanDuel have been mostly free to set the parameters of play, which, as it turns out, is near anarchy, especially for the D.F.S. elite.
This gives experienced players an advantage over new players that (very arguably) isn't true of poker because the players adhere to a stricter, more heavily regulated set of rules and have more of a choice of competition between hundreds of casinos vs. 2 sports betting websites.
It's definitely a tenuous argument though. At the end of the day, it's gambling, just like the stock market is gambling. Unless you have insider info, you're at the whim of the market and the traders with high powered hardware/software and connections.
For example, slot machines in Nevada are only legally required to pay back 75% to players on average
The most important word in Vegas is that last one...average.
As long as all the machines in the house average 75% in payout, the house is in compliance.
What it means for the average player is that the low-denomination slots (nickel, quarter) can pay significantly less than 75%, and by setting a few high-denomination slots ($1/$5/$100) above 75%, everything comes out clean.
So it's an even worse situation if you play the cheap slots.
The usual problem with gambling: regulate it too much and people will flock to somewhere else, quite often somewhere where the odds are lower towards the gambler than before.
Like with drugs, booze and smoking: banning is not a solution, especially not in our hyper-globalized world.
But on the other hand, gambling can bring serious social ills. Gambling isn't banned in most places because we don't want you to risk $5 to win $10, it's banned because of addiction, associations with crime, heavier impact on the poor, etc.
I don't have a stance on the issue per se, but I do think there are strong arguments against unrestricted gambling. Unlike the drug war, at least, the people in hot water are the people making money, not their customers.
Those same strong arguments might apply to alcohol, as well.
I don't agree with people being told they can't use their money irresponsibly. It's theirs to spend how they please.
Every poker site & casino I've played at allows self-bans, and we have treatment programs for problem gamblers just like we do for problem-everything-elsers.
>I don't have a stance on the issue per se, but I do think there are strong arguments against unrestricted gambling.
There are strong arguments against unrestricted anything. I think it's a shame so many people see little value in the ability of people to do what they want and accept the consequences.
I lose confidence in guys like Oliver and Jon Stewart, because the few times they talk about a subject I actually know very well, they make misinformed points that betray their lack of research/experience in that field.
> Most people in Ponzi schemes are being directly mislead. They don't think it's a gamble.
Most people are being directly mislead. This is true for the vast majority of the human experience. Politics, love, advertising, the list goes on.
Why are Ponzi schemes less palatable than being fleeced by automated scripts on a sports-betting site? In both cases, people think they will make money because they are smart, when they actually will lose money because they are dumb.
> In both cases, people think they will make money because they are smart, when they actually will lose money because they are dumb.
I don't agree with this sentence. Ponzi scheme people probably don't feel smart, rather they've been mislead into thinking they have an opportunity to invest in something where they can't lose. And participants in DFS don't lose based on their intelligence, generally speaking.
To answer your question, though, Ponzi scheme participants are being intentionally misled by fraudsters, where DFS participants are willingly gambling of their own accord. That's the difference in palatability.
I think you are misrepresenting what a Ponzi scheme is. People actually get defrauded and are given phony fund statements and they are generally not aware at all that there is a Ponzi scheme occurring, they just think they happen to have a good fund manager. So it's not a good comparison.
If it's gambling, people shouldn't be able to consistently and skillfully win at it.
Fantasy sports is much closer to the stock market than casinos. There's a lot of luck and speculation involved, but you can carve out an edge through skills.
I mean, yes, but poker is without any doubts the poster child of gambling. Poker defines gambling. Gambling is more than poker, but all that poker is as a game is also gambling.
But we still have gamblers that can play poker skillfully and do so as a career. They can win over and over.
Therefore just because something is gambling does not mean that you cannot be skilled at it and win over and over.
Gambling does not preclude getting an edge through skill. The honeymooners at the 5$ tables are like peewee footballers while the whales are like professionals. There are levels of skill in gambling.
It actually seems rational to me in many cases. If your very poor, but not so poor that a dollar per week makes a huge difference, then buying a lottery ticket makes sense. While the expected value of the ticket is less than a $1 -- given you only live once -- you're betting on the fact that there is a slight chance in this one life you might hit it big.
That seems completely rational to me. Especially if the odds of improving your lot substantially via other means is also low -- and not contingent on the accumulated $1 you spend on lottery.
And so is debt-financing of non-necessities by the poor; most of the poor in the US are already likely to be bankrupted at some point in the next 10 years (even living fairly frugally they don't get paid enough to cover expenses for a likely period of unemployment, or a large bill due to unexpected health problems), so they might as well have fun before that happens.
There's also the fact that expected payout is not the only value a lottery ticket offers. There's the entertainment value as well.
If you think about it, entertainment is the biggest factor involved in the decision about whether to partake in gambling or not. I do not generally enjoy any sort of gambling, that's why I don't do it. But I will happily pony up a few bucks to play Keno with a cute girl at the bar.
That's fair enough, as long as you realize going in that the chances of you getting that payday are basically impossible. There's a better chance of you finding that money in a duffel bag in a dumpster than you winning it through the lottery.
But then, on the other side of that you have the lottery winners who do hit it big after years of trying, then go bankrupt near-immediately because the reason they were poor in the first place is they didn't understand how money works.*
*No I'm not saying all poor people are poor for this reason, I'm saying a certain subset of them are.
The problem is that nobody spends just $1 on lotto tickets. Many people who buy lotto tickets (mostly poor people) are spending a significant percentage of their yearly income on them [0]. I was at a gas station in the boonies a few weeks ago and the 5 people ahead of me in line each spent at least $30 on scratchers.
I don't think there is all that much difference between fantasy sports and wall street. In both cases there is an element of skill (however small that might be) and luck. In both cases there are people with more skill and resources that are profiting off less skilled or knowledgeable insiders. Really it is the same thing almost. Maybe that is what is making NY nervous? They have a new competitor to wall street /s
Daily fantasy sports are like poker. There is an element of skill in each, and you'll see the same skilled players win consistently.
However, based on my anecdotal evidence of being a fantasy football player (but not DFS, admittedly) and having formerly spent lots of time in online poker rooms, poker involves more skill than DFS. In poker you "play the player, not the hand." But in DFS, there is no equivalent. So I would argue poker, a game classified as gambling, involves more skill than DFS.
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There is also this article about games of skill. While not completely related, I find it interesting that casinos are trying to find games that people think they are more skilled at than the average joe, and can therefore think they can win. http://www.npr.org/2015/04/29/403094845/casinos-switch-out-s...
From my own experience, poker and DFS involve about the same level of skill and study to be consistently profitable. DFS just scales more easily. You said, "In poker you play the player, not the hand. But in DFS, there is no equivalent." There actually is an equivalent. If you study DFS, you'll find that there's a cottage industry in figuring out what players will be most popularly owned in a given slate and then using that information to increase your own EV (e.g. in a tournament, if you projected Aaron Rodgers and Cam Newton to score the same number of points but 80% of people would play Rodgers then you would want to play Cam Newton because if he does go off big time then you now ahead of 80% of your competitors).
I disagree on this. Casual poker players will just play his hand as he's not that experienced with reading people.
While you are right that there is no DFS analogy to 'playing the player,' advanced DFS players build complex models, hedge their bets, and write (or hire people to write) scripts that update their bets as their beliefs about that day's games changes. Different kinds of skills than poker, but not less skill.
If OP meant to say that the average player plays poker with more skill than he plays DFS with, then I too disagree.
However, I think what he meant is that poker allows for more skill--it's a deeper game. I agree with that sentiment. Poker includes all of the things you mentioned, and more:
* Building complex models about the other player's strategy
* Hedging bets in the form of pot-control, post-oak betting, bluff/fold situations
* Scripting, of course. There's tons of scripting & mathematical work that can be done in both.
Then you've got bet sizing, psychology, bankroll management (in both), incomplete information, and the list goes on and on for some time.
Any given poker decision might weigh a thousand factors or more, in real-time, and that often happens several times per hand.
I've tried to explain this same point to people but haven't been able to articulate it well. I think you just hit the nail on the head with your explanation.
DFS is more like the stock market: the skilled players take advantage of suckers and get richer, while the average schmuck only wins by not playing the game (and just investing in index funds).
The difference between them is that one provides an essential function to our economy, and the other is just a sports book. Hell, even the stock market has a definition of "professional investor" that means certain consumer protection rules don't apply to you because you should know better.
The exemption exists purely from the lobby efforts of the NFL and MLB. The original bill contained no such exemption. The loop hole was added in committee.
Funny enough, the automation/optimization/scripting/algorithm aspects of DFS are a big part of what makes it interesting to me. I have domain knowledge about sports, so DFS is a better testbed for me to learn and explore these areas than, say, automated stock trading.
It's a great place to practice linear algebra, machine learning, forecasting and projection models, web scrapping, data cleaning/normalization, and API wrangling. And all without needing a brokerage account, minimum account balance, or transaction fees!
I never thought about it this way, and while you don't have to worry about brokerage accounts and minimum fees, you have to pay for accurate stats. Using a place like ProFootballFocus or StatsInc is going to cost you a pretty penny if you want to scrape an API with up-to-the-second accurate information.
You don't need "up to the minute" information though. Data can be days old and still be viable as long as you're using twitter's streaming API to get injury updates from one of each 32 teams beat writers as they occur. If I'm setting an NFL lineup on Friday I know the stats haven't had an opportunity to change in 6 days.
Injury reports are serious wrinkles. Often time players will be scratched within a few hours before the game. If you are optimizing, you need to account for this because it sends the backups value much higher than his salary. For example, last night Rajon Rondo was scratched. His backup Darren Collison, was in over 80% of the lineups in a FanDuel 50/50 tournament. I didn't have him, and I lost $2.
You could also apply these same skills within NLP (Natural Language Processing), replacing "Sports" with "Linguistics" and provide a lot more positive net impact on the world
True, perhaps... but whenever I'm learning something for fun, I apply it to something without any applicable human benefit.
I dabbled in machine learning algorithms... but just so I could play board games with my computer. As a student, I think it matters less what you're applying your emerging knowledge to.
The beauty of fantasy sports is that it converts sports fans, a subculture noted for excessive enthusiasm, into suckers. That's a feature, not a bug.
Think of it as monetization of the sports sucker demographic.
From the industry perspective, they don't care who wins. They're a pari-mutual operator; the players bet against each other and the house takes a cut, like horse racing. This is different than casino gambling, where the players play against the house and the house can lose. That's why casinos don't permit blackjack card counting. FanDuel doesn't care how you plan your bets.
"91 percent of the prize money was won by a mere 1.3 percent of the players." Right. There's a sucker born every minute.
Throw in a few mentions of DFS=D&D, plus a few mentions of HandEgg and Superb Owl, and you'd have the perfect stereotypical nerds vs jocks rant.
I'm not sure if you read the (excellent) article, but what's going on here is they lure in rich, sophisticated to make huge, scripted bets across many, many accounts, giving them privileges 'normal' users don't have, in order to create huge jackpots and a much larger cut for the DFS site operator. They then use that take to invest in ads to lure more and more suckers.
Interesting read. I don't think its too different from your average financial market though. Lesson 101 in finance is that money flows from private to institutional investors. It seems this is the case with DFS too.
But you can choose to enter games that are only against your friends - I do every week. (There's nothing physically keeping a stranger from joining our game, but since they don't know the link, and we all enter as soon as one of us creates the contest and sends us all the link, it's unlikely.)
OK, I also enter other games, but in those, I typically go for the games that are small, and almost filled, so I can look at the list of other players and only enter if there are no very experienced players there.
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[ 2.8 ms ] story [ 198 ms ] threadI would think spending time and money watching millionaires wearing shiny spandex pants give each other brain trauma in billion dollar stadiums paid with our tax money makes us suckers regardless of the existence of Fantasy Football.
I used to really hate sports, and make fun of people. It took me a long time to realize i was just an alienating asshole. While not really my thing, i try to put in a tiny bit of effort to be aware of what's going on in sports, and it's improved casual relationships a lot. That said, taxes for stadiums is a pretty bad idea.
I don't have any interest in listening to someone rattle on for hours, but a minute or two listening to something they're excited about, well, it goes a long way. A reply like "I'm not much of a sports fan, but that sounds amazing" is pretty effective. Just let people bask in the glory of whatever they love for a moment or two, sports, tv shows, how smart their kid is, vacation pictures, whatever.
I guess, i wouldn't talk to people if they weren't important or interesting in the moment in some way, taking an interest in what they find interesting makes me feel more connected somehow.
This guy was destined to be a sucker. It's not that DFS turned him into a sucker, it's that he has a gambling problem - he says this in the beginning of the article! Why do we need to read further, it's pretty clear from that statement alone he's not going to do well in the long run just knowing the psychology of a gambler like that.
And to be frank, he isn't very smart with his money either. He's doing a lot of things that are increasing his risks and destroying his bank account which could be fixed with some simple statistics and discipline (which, for someone with a gambling problem, would be almost impossible).
The way to not lose money like the author is employ many of the same tactics you would with investing:
* Put in only what you can afford/feel comfortable losing
* Stick with the Kelly criterion[1] and never bet more than 10-20% a day
* Diversify - instead of 1 $20 H2H game like the author, play 10 $1 H2H games and 10 $1 50-50s. Now instead of flipping a coin once to make $40 all or nothing, you get to flip a coin 20 times, and each win gets you $2, which can mitigate some of your losses.
Now to be fair, that last example is a bit inaccurate - because each coin flip is not an independent flip like in a true coin flip, because if you use the same lineup, and that lineup performs poorly, it's like having a weighted coin severely against your favor, but at least with H2H matchups, you know that some people can bomb worse than you, whereas in 50-50s, since you only have to do better than half, in a large sample size, you likely won't win any of your 50-50s since the median score is roughly the same across all of them.
My point is two-fold:
1. DFS doesn't turn people into suckers, they already were suckers/gamblers and didn't do their homework and practice discipline, which brings me to my next point...
2. DFS is a game of skill - for an exaggerated example, it takes a basic level of competence to choose Tom Brady over his backup, Jimmy Garoppolo. You can be almost certain he will play, as he's pretty much played every game in his career except for an injury nearly a decade ago. But DFS is also gambling. We know it is, but saying it's legal gambling won't bring on new customers. It takes a lot of work to say "100% Legal" all over your site and still not have people sign up.
The US is a funny country. We don't legalize online poker but we legalize in-person poker in casinos all across the country. We legalize DFS but not online poker. Where is the logic in this?
For the HN crowd, if you want to try it and you like sports stick with the above advice: don't play if you have a proclivity for compulsive or irresponsible gambling. Don't put a lot in (and only put in funny money, nothing you would otherwise use for say, your mortgage), and exercise a bit of statistics and probability theory so you mitigate some of the risk. If you do that, you won't become a sucker.
[1] Kelly criterion - https://en.wikipedia.org/wiki/Kelly_criterion
That said, if your doing this for entertainment then minimizing the money your betting is reasonable. People making 100+k per year can get really competitive over penny poker.
That still seems to be dangerous because you have no diversification, in lineups or allocation of funds. Would be curious to understand your reasoning more.
These games are negative sum for most players as the house takes part of the pool. For simplicity, let's say it's a 50:50 coin, but you win 1.99 of your stake. With one bet the house takes some of your winnings, but your odds don't change. With 2 bets, if you win both you win, if you lose both you lose, but if you win one (1.99) and lose one (0) you still lose (1.99 + 0) / 2 < 1.
Sure, your odds of losing 'big' went from 50% to 25%, but your odds of winning big went from 50% to 25% and your odds of losing slightly are now 50%. Same thing applies if it's a 10% chance to win 9.99x your state, with 10 bets and 1 when you still lose. However, your odds of a 9.99x win are much smaller. (1 in 10,000,000,000 vs. 1:10)
Granted, if your vastly better than other players you can get a small advantage. But, that's not going to be very significant over a small number of games.
To make it really obvious make it 10,000 bets not just 20 bets.
PS: Now, if the odds are in your favor that's another thing. But, in that case you don't expect to lose your shirt over time.
2x winnnings * 50% chance of winning * 20 games * $1 per game = expected outcome $20
2x winnings * 50% chance of winning * 1 game * $20 per game = expected outcome $20
Your fuzzy logic around "winning big" "losing big" etc doesn't change the basic math of the expected outcomes, which is simply (chance of a thing happening) * (result if it happens).
With one game you never actually end up with ~20$. It's either 0 or ~40$. Expected value is close to break even, but you get an actual bet going.
With 20 games you never end up at 0 or ~40$ it's 'always' (524,287/524,288) something between those extremes. However, with negative expected outcome games the average case is bad, so you odds of winning are less than 50/50 and your average win is tiny.
Further, many people play not just a fixed number of games, but keep playing until there stake is gone, which tends very strongly toward zero.
Net result, if you play just one game you have a reasonable chance of winning. If you play lot's of games you most likely will keep losing money until you stop.
PS: This is why most casinos don't take big bets; they make far more money from people making lots of small bets over time.
If someone is going to keep playing with their winnings, they're likely to do so either way.
Ex: if you have a slight negative bias say 50:50 to win 1.999x and play a trillion games your going to flat out lose money with Effectivly zero % chance of winning.
For instance in many places bartenders are bound by law to not give more alcohol to people that are already drunk.
The biggest problem I see with gambling is that the Pareto effect shows an ugly face there: often it's just economically feasible for the operator because of the addicts.
Bartenders are bound by law not to give drunks more alcohol because they could go drive a car and kill someone. A gambler is only hurting himself when he loses his money.
Why do you think heroin or meth are illegal? Those substances are only hurting the person using them, right?
The damage is not as impactful and severe, but it is still damage.
But I'm still not convinced about your parents first sentence.
But in my opinion the harm an addict can do to others isn't even the only problem. Addiction is a sickness that needs treatment and help. Addicts are victims first (at least partly of themselves) and only then can also be perpetrators.
Living off the problems of other people (by enabling them in their addiction, not by helping them) to me personally is morally questionable. It might be a bit of a cultural thing though, as here in Europe there isn't as much emphasis on the idea that everyone needs to take their luck in their own hands as there is in the US.
I find your last paragraph interesting. I too, am European. But there are lots of cultures in Europe. To me, the word "responsability" struck me as being very strong.
As a portuguese, we are sociably incentivised to help each other out but it usually goes as far as helping a "friend of a friend". We have almost a "helping out" economy, that I believe comes from the hardships from our parents and grandparents during the middle of the century. And it's how we make bonds with each other.
But when someone can't or doesn't want to help, it's OK. The way you phrased it turned a "could do" and "might do" to a "must do".
But anyway, suppose they could. There's always the world's biggest casino: the stock market. Or there are actual casinos. Or there are lottery tickets.
In most gaming jurisdictions, casinos are required to pay for billboards and the like advertising where a problem gambler can get help. (The lotteries, which are state run, never do this, and Wall Street sure as shit doesn't.) I'd have no problem with those sites putting link to Gamblers Anonymous on every page.
But beyond that, I don't think they have responsibility.
I'm curious, did the market play out like you thought it would? Is this about where you expect daily fantasy will end up, or are there still big changes ahead?
It is a shame we weren't the ones to have gotten there. I would have learned some lessons from the rise and fall of online poker that the DFS guys don't seem to have.
I'm addicted to Hackernews. Does the fact that it's a free site make the operator any less responsible?
How about we just make everyone personally responsible for their own actions. Gambling addicts can just block the website.
Bartenders have a responsibility not because of addiction, but because someone could actually kill themselves or others when they are too drunk.
I also don't see the medical marijuana dispensaries responsibly for people that ruin their lives due to MJ addiction (yes, I know that it's not chemically addictive, but like gambling, you can get addicted to it).
If you want to play fantasy sports, play one of the free non-betting sites that have been around for years. The new DFS sites you see on ESPON are full of sharks that will eat you alive.
On a meta note: it's funny to contrast the NY Times coverage of DFS with ESPN's. I think the NY Times is doing a public service here. Although it probably largely goes over the head of the audience that would most benefit by it, it has already clearly filtered in the larger public debate.
Meanwhile, I actually saw front-page coverage a few weeks ago of a protest by DFS advocates against the Attorney General's decision to reign in DFS sites. I wonder who even organized that protest.
(disclaimer: I have many better ways to throw my money away than thru gambling)
Gambling addiction affects partners and children.
So, which of those should we protect you from? As a society, of course.
I don't understand the point of your question in the context of parent's post which was talking about gambling addiction.
It's easy to say that "as a society" we should protect someone else from their behaviors.
It's different when someone else ("society") is telling you not to do things.
Which of your behaviors should society protect you from?
Does that very question not make you uncomfortable?
I'm sure somebody can point to a flaw of mine and say we need to regulate that, and they very well might be right. If I'm particularly obstinate about the topic I might resist, but that doesn't mean that it isn't something that should be legislated. That being said, I'm not calling for widespread legislation to protect us all from our problems, I'm just pointing out that it is a valid opinion to desire more government regulation on personal behaviors. Although it is an uncommon opinion.
Risking all of my money (or more) on a big gamble is one of the liberties I not only am glad to have, but have exercised in the past, including becoming a professional poker player, starting a bar business, buying a large property, and riding a motorcycle.
I dislike that I'm required to wear a seat belt, and even more than that, I dislike that other people get to demand it of me.
It's a bit harder to argue that there is a great cost of gambling that is spread across society, however I'm a poker player myself so a bit biased.
A problem with that argument, of course, is that it leads down the path of banning everything that's risky and where society shares the downside. We don't want to do that, so society picks and chooses the highest risk (or worst downside) activities to ban.
We've picked seat belts as the one to police, probably to give a lot more leeway to police to pull people over and generate income.
Anyway, you say society has the right, and I'm not sure I agree, at least in the seat belt example. They have the power, sure, but I don't think they (ought to) have the right.
My mother is allowed to be a drunk, nobody cares how it impacted my childhood. I'm allowed to have trust issues, though it impacts my relationships. I'm allowed to overeat though it might impact my childrens' view of obesity, likelihood to be obese, and finances if they have to support me later. Etc etc.
We've chosen to not allow people to play poker online, to protect them from themselves, but it's a rather arbitrary thing to choose, especially given all the other ways they can destroy their finances.
We can't protect everyone from being exploited in every manner, and it could probably be argued that we ought to quit trying in a lot of cases. IMO it's generally not our place to protect people from themselves.
I'm also in favor of child protective services.
But when someone goes out to gamble/play DFS, they aren't looking to diversify their bets in order to minimize their chance to lose. The base use case is "Hey, I have a few bucks, I'd like to place a quick bet for kicks, and maybe I have a chance to beat some other like-minded folks". Before DFS, you'd just grab your buddies and make an impromptu bet, and that's that. The implicit expectation is that you're playing with other players like you. And that is precisely what the DFS advertisements promote: you are expanding your pool of for-fun players by orders of magnitude. I'm going to the site, kicking in a $20 every few weeks, for the entertainment and possibility of winning. I'm not going to make 20 $1 bets because that isn't...fun.
The disconnect comes from the fact that DFS pit you directly against top-ranked high-rollers, who are not just schmoes off the street. Sure I don't expect to win. But I also don't _expect_ to be playing top 25 players in the world who are playing with thousands of bets.
That issues is covered in depth by the article, but from the looks of your post, you just seemed to stop reading after the 'gambling addict' bit. The last paragraph covers this:
"At the start of the N.B.A. season, a couple of friends and I started a friendly league on DraftKings. Every night, we draft teams, watch the points accumulate and make fun of one another for our picks. On the first of each month, we pay one another what we owe. One of these friends creates N.B.A. player performance models. They help him escape the cynical demands of his job as a corporate lawyer. To date, I am down $350 to him.
“Yes, yes, yes,” Harber said when I told him about this league. “That’s how it’s supposed to be.” "
The very fact that he ADMITS he has a gambling problem up front should have been a clue that the article was going to be about something other than whining about losing money (which he never actually did).
He's outlining the ways in which the sites are corrupt.
In practice, who typically ends up drawing this distinction? Appellate judges?
It's also misleading since in, for instance, blackjack, even when you play at the highest (casino-allowed) skill, you will lose. That's not true of poker or DFS.
There's still plenty of nuance (luck prevails in the short term while skill prevails in the long term).
`(D) does not include--
`(ix) participation in any fantasy or simulation sports game or educational game or contest in which (if the game or contest involves a team or teams) no fantasy or simulation sports team is based on the current membership of an actual team that is a member of an amateur or professional sports organization (as those terms are defined in section 3701 of title 28) and that meets the following conditions:
`(I) All prizes and awards offered to winning participants are established and made known to the participants in advance of the game or contest and their value is not determined by the number of participants or the amount of any fees paid by those participants.
`(II) All winning outcomes reflect the relative knowledge and skill of the participants and are determined predominantly by accumulated statistical results of the performance of individuals (athletes in the case of sports events) in multiple real-world sporting or other events.
`(III) No winning outcome is based--
`(aa) on the score, point-spread, or any performance or performances of any single real-world team or any combination of such teams; or
`(bb) solely on any single performance of an individual athlete in any single real-world sporting or other event.
`(III) No winning outcome is based-- (aa) "... performances of ... any combination of such teams;" `
So illegal?
If I bet you five dollars that I can win a foot race, and then get on a motorcycle, I didn't win because I'm more skilled.
An interesting parallel would be the HFT "market-makers": I could argue that's exploiting the architecture of the markets, not "playing the game".
This is the same issue that people have with card counting, wheel spin analysis, prng analysis, hft, dice throwing, etc. People who are good at math use that skill to make games of skill of what people incorrectly believe are games of luck.
Rich people always get upset when they think they are fucking over someone dumb when really they are getting fucked over by someone extremely smart. Then they write articles about how unfair it was that they were too dumb to realize the game wasn't rigged how they intended to rig it.
Hence we end up with articles like this, that it's 'unfair' that the author is a poor gambler and repeatedly accepts wagers that are not in his favor. He even made a spreadsheet of how dumb he is and then refuses to accept the math that proves he's dumb.
I think DFS fails in two ways:
1. Corruption - All the stories in the last 6 months about FanDuel employees using insider knowledge to gain an edge on DraftKings, for example. That is screwing the fan, pure and simple.
2. Creating a Predatory Environment - The issue here is allowing power players to "rape and pillage regular players". In the same way that I'm not going to enter the WSOP, I'm going to have a much better experience playing against those at my skill level.
You could probably throw "false advertising" in there, too, but we'll let the FCC deal with that.
I'm not sure if this is really on-topic, but I think you'll find this interesting if you're not aware of it: https://en.wikipedia.org/wiki/Skill_testing_question
With lots of legit, liquid money in play, it doesn't take a rocket scientist to figure out that you can corrupt players and coaches to massage the stats, or those same players and coaches can participate through proxies.
With horse racing, which is the closest thing to this stuff, there are a few different sets of stakeholders with different interests. Owners, trainers and jockeys who are cheating are pretty easy to identify.
End of the day, you're better off trusting the dice.
That's certainly what the article is implying:
> D.F.S. high rollers similarly come with demands, and because there’s no powerful regulatory body involved, DraftKings and FanDuel have been mostly free to set the parameters of play, which, as it turns out, is near anarchy, especially for the D.F.S. elite. High rollers want to be able to use third-party computer scripts that will allow them to enter thousands of lineups at once, something that your average player cannot do. High rollers can gain access into D.F.S.’s inner circle, in which they get to be on first-name, texting basis with executives and employees at DraftKings and FanDuel. They can operate under the cover of plausible deniability — if other players complain that the high roller has been using tools that destroy competitive balance, he might expect the sites to stick up for him.
It does threaten the long-term viability of the game though. Newbies are going to come in, get fleeced, and quit.
We need actual legal sports gambling.
I am not as familiar with DFS, but I am sure it is doable, and there is enough money on the line to make it worth doing.
For one, it's a website. How do they detect legitimate traffic vs scripted traffic? There would be countless ways to hide the fact that the traffic is scripted. Think about most sites -- they're barely able to keep the things running, let alone add on an additional huge workload of fraud detection...
.... Especially when the fraud benefits them!
I don't understand this bit. What's the difference? The casino is taking money from those honeymooners; and it's paying it out to the whale. The whale negotiates rules that are different than those that apply to the honeymooners. How is this different than the DFS whales?
Is the only difference that FanDuel/DraftKings allow players to engage in one-on-one challenges, vs. playing against the house?
Johnson did not miss the math. For example, at the Trop, he was willing to play with a 20 percent discount after his losses hit $500,000, but only if the casino structured the rules of the game to shave away some of the house advantage. Johnson could calculate exactly how much of an advantage he would gain with each small adjustment in the rules of play. He won’t say what all the adjustments were in the final e-mailed agreement with the Trop, but they included playing with a hand-shuffled six-deck shoe; the right to split and double down on up to four hands at once; and a “soft 17” (the player can draw another card on a hand totaling six plus an ace, counting the ace as either a one or an 11, while the dealer must stand, counting the ace as an 11). When Johnson and the Trop finally agreed, he had whittled the house edge down to one-fourth of 1 percent, by his figuring. In effect, he was playing a 50-50 game against the house, and with the discount, he was risking only 80 cents of every dollar he played. He had to pony up $1 million of his own money to start, but, as he would say later: “You’d never lose the million. If you got to [$500,000 in losses], you would stop and take your 20 percent discount. You’d owe them only $400,000.”
http://www.theatlantic.com/magazine/archive/2012/04/the-man-...
The argument is that in DFS because the whale is winning "other people's money" well then it's not as bad in the company's view.
But obviously the supply of "fresh meat suckers" is a corporate resource of the company's that is being exhausted by too much whale fleecing... so they still police it to an extent, but just not as much.
Allowing scripted entries is one of the biggest examples of this and a huge differentiator between DFS and casino games like poker. You will very rarely have an absolute poker novice playing against a skilled shark. The novice will generally know they are a novice and will enter lower stake games. The shark's time is money and they will only enter games with high enough stakes to merit playing. This is completely different for DFS when scripting is allowed. The sharks can play an almost unlimited number of games against any opponent. If it is completely automated, there is no reason why the shark can't challenge the complete novice who is only willing to bet $5.
This is gambling. Not strictly defined as such, but if it looks like a duck, walks like a duck, and quacks like a duck, guess what?
Do you consider betting on horse racing as gambling? To be honest, for the professionals placing bets in this way, I don't (keep in mind it's very very easy to incorrectly place yourself in this category, and you will lose). But the vast majority of people betting on DFS do not, and can not, take this approach. For them, horse racing and DFS are very much gambling.
If the whale negotiates the odds in his own games, he's changing the expected outcomes in his games versus the house, but he's not altering the odds for the honeymooners.
He might win physical dollars that were lost by the honeymooners, but because both players are playing the house, it's meaningless 'whose' money he's winning. He's taking money from the Casino's profit margin, really. They're gambling that he'll still lose more than he wins, and the slimmer margins will be made up in volume.
DFS is a skill game both in player selection, AND in skirting the rules, AND in getting the 'house' to tilt odds in your favor -- which directly tilt the odds even further away from the other players.
The only people who win money (on average) at casinos are "professionals" who play games against other players rather than strictly against the house - poker being the prime example. Many poker pros will hang out at "amateur" tables and pose as suckers to draw in less experienced players, then hustle them.
So ultimately the casino does not redistribute money to the whale - it reaps money indiscriminately due to its "house edge" on every game and slot machine.
Here's a breakdown of the house edge and std deviation for a bunch of different games [1]. Craps and blackjack have the smallest house edge due to historical rules of how the games are played, whereas games such as slot machines have a high house edge as the casino can tailor the software that determines the payout. For example, slot machines in Nevada are only legally required to pay back 75% to players on average while the rest goes to the house - a true gamble for suckers. [2]
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The article implies that DFS is different because FanDuel and DraftKings are unable to implement strict rules that collect from players indiscriminate of size.
D.F.S. high rollers similarly come with demands, and because there’s no powerful regulatory body involved, DraftKings and FanDuel have been mostly free to set the parameters of play, which, as it turns out, is near anarchy, especially for the D.F.S. elite.
This gives experienced players an advantage over new players that (very arguably) isn't true of poker because the players adhere to a stricter, more heavily regulated set of rules and have more of a choice of competition between hundreds of casinos vs. 2 sports betting websites.
It's definitely a tenuous argument though. At the end of the day, it's gambling, just like the stock market is gambling. Unless you have insider info, you're at the whim of the market and the traders with high powered hardware/software and connections.
[1] http://gaming.unlv.edu/casinomath.html
[2] https://en.wikipedia.org/wiki/Slot_machine#Payout_percentage
The most important word in Vegas is that last one...average.
As long as all the machines in the house average 75% in payout, the house is in compliance.
What it means for the average player is that the low-denomination slots (nickel, quarter) can pay significantly less than 75%, and by setting a few high-denomination slots ($1/$5/$100) above 75%, everything comes out clean.
So it's an even worse situation if you play the cheap slots.
Like with drugs, booze and smoking: banning is not a solution, especially not in our hyper-globalized world.
I don't have a stance on the issue per se, but I do think there are strong arguments against unrestricted gambling. Unlike the drug war, at least, the people in hot water are the people making money, not their customers.
I don't agree with people being told they can't use their money irresponsibly. It's theirs to spend how they please.
Every poker site & casino I've played at allows self-bans, and we have treatment programs for problem gamblers just like we do for problem-everything-elsers.
There are strong arguments against unrestricted anything. I think it's a shame so many people see little value in the ability of people to do what they want and accept the consequences.
Or are you talking about a different segment?
I've never understood why it's okay for people to waste money on fantasy sports but not on Ponzi schemes.
Most people are being directly mislead. This is true for the vast majority of the human experience. Politics, love, advertising, the list goes on.
Why are Ponzi schemes less palatable than being fleeced by automated scripts on a sports-betting site? In both cases, people think they will make money because they are smart, when they actually will lose money because they are dumb.
I don't agree with this sentence. Ponzi scheme people probably don't feel smart, rather they've been mislead into thinking they have an opportunity to invest in something where they can't lose. And participants in DFS don't lose based on their intelligence, generally speaking.
To answer your question, though, Ponzi scheme participants are being intentionally misled by fraudsters, where DFS participants are willingly gambling of their own accord. That's the difference in palatability.
Fantasy sports is much closer to the stock market than casinos. There's a lot of luck and speculation involved, but you can carve out an edge through skills.
But we still have gamblers that can play poker skillfully and do so as a career. They can win over and over.
Therefore just because something is gambling does not mean that you cannot be skilled at it and win over and over.
Gambling does not preclude getting an edge through skill. The honeymooners at the 5$ tables are like peewee footballers while the whales are like professionals. There are levels of skill in gambling.
The real suckers are people who still think easy money exists when you aren't a billionaire.
That seems completely rational to me. Especially if the odds of improving your lot substantially via other means is also low -- and not contingent on the accumulated $1 you spend on lottery.
If you think about it, entertainment is the biggest factor involved in the decision about whether to partake in gambling or not. I do not generally enjoy any sort of gambling, that's why I don't do it. But I will happily pony up a few bucks to play Keno with a cute girl at the bar.
If gambling wasn't fun, nobody would do it.
But then, on the other side of that you have the lottery winners who do hit it big after years of trying, then go bankrupt near-immediately because the reason they were poor in the first place is they didn't understand how money works.*
*No I'm not saying all poor people are poor for this reason, I'm saying a certain subset of them are.
[0]: http://www.dailyfinance.com/2010/05/31/poor-people-spend-9-o...
It's a rational suspension of disbelief (though irrational for addicts).
However, based on my anecdotal evidence of being a fantasy football player (but not DFS, admittedly) and having formerly spent lots of time in online poker rooms, poker involves more skill than DFS. In poker you "play the player, not the hand." But in DFS, there is no equivalent. So I would argue poker, a game classified as gambling, involves more skill than DFS.
--
There is also this article about games of skill. While not completely related, I find it interesting that casinos are trying to find games that people think they are more skilled at than the average joe, and can therefore think they can win. http://www.npr.org/2015/04/29/403094845/casinos-switch-out-s...
While you are right that there is no DFS analogy to 'playing the player,' advanced DFS players build complex models, hedge their bets, and write (or hire people to write) scripts that update their bets as their beliefs about that day's games changes. Different kinds of skills than poker, but not less skill.
However, I think what he meant is that poker allows for more skill--it's a deeper game. I agree with that sentiment. Poker includes all of the things you mentioned, and more:
* Building complex models about the other player's strategy * Hedging bets in the form of pot-control, post-oak betting, bluff/fold situations * Scripting, of course. There's tons of scripting & mathematical work that can be done in both.
Then you've got bet sizing, psychology, bankroll management (in both), incomplete information, and the list goes on and on for some time.
Any given poker decision might weigh a thousand factors or more, in real-time, and that often happens several times per hand.
The difference between them is that one provides an essential function to our economy, and the other is just a sports book. Hell, even the stock market has a definition of "professional investor" that means certain consumer protection rules don't apply to you because you should know better.
It's a great place to practice linear algebra, machine learning, forecasting and projection models, web scrapping, data cleaning/normalization, and API wrangling. And all without needing a brokerage account, minimum account balance, or transaction fees!
Or there are projects like https://github.com/BurntSushi/nfldb
Mind if I get involved too? I can shoot you an email.
No need for a brokerage account, minimum, or any sort of fee.
https://www.quantopian.com/open
I dabbled in machine learning algorithms... but just so I could play board games with my computer. As a student, I think it matters less what you're applying your emerging knowledge to.
From the industry perspective, they don't care who wins. They're a pari-mutual operator; the players bet against each other and the house takes a cut, like horse racing. This is different than casino gambling, where the players play against the house and the house can lose. That's why casinos don't permit blackjack card counting. FanDuel doesn't care how you plan your bets.
"91 percent of the prize money was won by a mere 1.3 percent of the players." Right. There's a sucker born every minute.
I'm not sure if you read the (excellent) article, but what's going on here is they lure in rich, sophisticated to make huge, scripted bets across many, many accounts, giving them privileges 'normal' users don't have, in order to create huge jackpots and a much larger cut for the DFS site operator. They then use that take to invest in ads to lure more and more suckers.
OK, I also enter other games, but in those, I typically go for the games that are small, and almost filled, so I can look at the list of other players and only enter if there are no very experienced players there.