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// PUBLIC GAMING INTERNATIONAL // November/December 2015
NHL, as well as some of the owners
of the teams.
Some 56 million people have played
Fantasy Sports in North America. Ac-
cording to STATS, Inc., 10 million of
those are teenagers. All other forms
of gambling are prohibited by U.S.
federal law, until and unless the indi-
vidual state decides to legalize and
regulate it. The UIGEA exempted Fan-
tasy Sports from that fundamental
policy based on the idea that it is a
skill-game. So, unregulated Fantasy
Sports is legal until a state govern-
ment steps in to regulate it or prohibit
it, as some states have done. How
might this all unfold? What are the
regulatory issues going forward?
Paul Jason:
Is there any kind of regulato-
ry oversight being applied to Fantasy sports,
anything being done to ensure the integrity
of the games?
K. Mullally:
I’m not aware of any le-
gal regulatory structures that exist right
now. Some operators are attempting to
provide transparency to the levels of skill
that are involved in their games. GLI has
been involved in analyzing some of those
games to provide a mathematical analy-
sis that give the operators, policy-makers,
and players information and insight into
the underlying dynamics of the Fantasy
Sports games. But GLI is not a law firm.
We’re not a government. So we don’t issue
legal opinions or rulings. We try to pro-
vide the information necessary for regula-
tors to understand the operation of the
games, measure the risks, and measure the
costs and feasibility of controlling those
risks. In the case of Fantasy Sports, there
is no regulator at this point, so we’re just
responding to requests from some opera-
tors trying to provide analyses and give
the various parties involved in the discus-
sion some good scientific-based evidence
on which to make good decisions.
Are your regulator clients asking you to
study Fantasy Sports to determine how or
whether to regulate it?
K. Mullally:
We’ve been asked to ana-
lyze the mathematical probabilities of the
games to discern the difference, if there is
a difference, and if there is, how much is
the difference between the outcomes of
a skilled player versus a random or a less
skilled player. GLI’s role is limited and fo-
cused—it is to provide scientific analysis.
There may be a lot of legal and social is-
sues that provide very fruitful ground for
debate. But it is actually part of my job to
scrutinize every report that GLI puts out
to ensure that we stay within our role of
providing scientific analysis and not mi-
grating into areas that are the responsibil-
ity of others, like regulators and policy-
makers. GLI does not opine, for instance,
on whether something is legal or not legal.
Does the skilled and knowledgeable Fantasy
Sports player perform better than the less
skilled player?
K. Mullally:
GLI has issued a general
white paper on this issue that’s available
on our website,
www.gaminglabs.com,
that speaks to this. GLI’s mathematical
analyses show that a skilled player can
do considerably better than a non-skilled
player. GLI is in a good position to ad-
dress questions based on science and evi-
dence, but not how policy-makers and
regulators should interpret and apply the
information we provide.
One of the challenges of a regulator
is that there will always be a tension be-
tween the need for market-driven inno-
vation, the need to protect the player,
the need for security and integrity in the
games, and the need to serve a variety of
policy-making interests. Regulators are
constantly trying to seek a balance that
meets this diverse set of objectives.
Everyone is asking whether Fantasy Sports
should be considered gambling, and to tax
and regulate it as gambling.
K. Mullally:
I’m not saying that people
don’t ask us to make that kind of a call, to
opine on whether Fantasy Sports fits into
the classical definitions of “gambling,” or
whether it is legal or not. Our answer is
always the same. We provide the analyses
and testing that we hope will inform the
decision-making process. But the classi-
fication of Fantasy Sports as gambling or
not is not in GLI’s purview. That is for
regulators and policy-makers.
The very definition of “gambling” (Chance
+ Consideration/Wager + Prize) is becom-
ing more and more fungible, isn’t it?
K. Mullally:
For one thing, that defi-
nition does not speak precisely to the
degrees of chance required to constitute
“gambling.” And that is just one aspect in
the way the definitions will need to be up-
dated. And the definitions will vary from
state to state, jurisdiction to jurisdiction.
When you’re practicing law, you’re al-
ways applying facts to law. Facts can defi-
nitely change. And bad facts usually result
in bad law. GLI’s mission is to prevent
that from happening by providing some
clarity with regard to the facts so that peo-
ple aren’t making assumptions, aren’t leav-
ing information out, aren’t applying bad
facts. We try to assure that the facts are
good, that the scientific analyses are based
on good facts, and ensure that aspect of
policy-making is sound and accurate.
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Kevin Mullally Interview
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