Yahoo’s daily fantasy sports (DFS) product is coming under fire after the definition of a ‘guaranteed’ prize pool turned out to be open to interpretation.
Yahoo’s DFS product, which launched with great fanfare earlier this month, offered a Major League Baseball contest on Friday that was “guaranteed to run” even if it failed to match the expected 10k entries. Yahoo published a payout schedule specifying the exact payouts each of those 10k entrants would receive based on an expected prize pool of $22k.
But the contest attracted only 2,944 entrants, to whom Yahoo paid out a total of $7,868. Though the payouts matched the published schedule for the top 2,944 entrants, some players took to forums like RotoCurve to express their outrage at Yahoo’s alleged failure to live up to its ‘guarantee,’ which these players interpreted as meaning Yahoo would pay out the full $22k.
While the controversy is debatable and the aggrieved number of players is relatively small, the public perception of misleading promotions won’t help Yahoo’s efforts to poach DFS players from the industry’s two main operators, DraftKings and FanDuel. But Yahoo’s tactics could also leave the company and the whole DFS industry open to further examination by US law enforcement.