DraftKings Continues International Expansion with Australian Launch

Much to the chagrin of locally-owned fantasy sites, the world’s largest daily fantasy operator has announced its grand launch in Australia. DraftKings announced the launch on Tuesday and said the company plans to begin holding real money contests for Australian customers in the second quarter of 2018.

In a press release, DraftKings announced it has received a license from the Northern Territory Racing Commission and will operate throughout the country with the exception of South Australia.

DraftKings CEO Jason Robins said this in a statement:

“Within the last few years, Australia’s burgeoning fantasy sports market has dramatically evolved, adding a variety of daily fantasy sports platforms, feeding the appetite of the many passionate sports fans who love getting closer to the teams, athletes and sports they love. Australia is an important market for DraftKings, as it combines devoted sports fans with sophisticated, tech-savvy consumers – exactly the kind of people who love competing on DraftKings.”

A handful of fantasy sites are already licensed in Australia. DraftStars, Moneyball and PlayON are all active and hold licenses, but none are even close to the size of DraftKings. Existing fantasy sites in Australia are going to have their hands full as they compete against DraftKings, which will bring with it tons of players, massive prize pools and a gargantuan marketing budget.

DraftKings hosts 20,000 contests every day and has paid out nearly $5 billion to 750,000 winners to date. This company once spent $156 million on TV ads in a single year, targeting just the US market. Although DraftKings has not announced anything more specific than a planned second quarter launch, there’s no question its presence will be felt in the Australian market.

Australia Just the Latest New Market for DraftKings

Australia is just the latest international expansion for DraftKings in recent years and is the eighth country in total in which DraftKings operates. DraftKings got its start in the United States and Canada and fought to establish a foothold in North America first. Later, DraftKings expanded to the United Kingdom after receiving a license from the UK Gambling Commission.

In addition to the UK, DraftKings operates in Germany, Canada, Ireland, Malta, Austria and now Australia. This move marks DraftKings’ first expansion to a market outside the familiar North American and European markets.

DraftKings and FanDuel attempted to merge last year, but the Federal Trade Commission (FTC) sued to prevent the merger based on concerns such a merger would harm competition in the daily fantasy industry. Both sites opted to call off the merger and go their own way.

Ever since the failed merger, DraftKings has looked to international expansion while FanDuel has focused exclusively on the United States. More recently, DraftKings has made moves indicating the company is read to pivot to sports betting in the United States if a pending Supreme Court decision ends up overturning an old law that prohibits sports betting outside of Nevada.

DraftKings has been the more aggressive of the two leading fantasy sites and the most willing to take on additional risk. For just one example, FanDuel decided to exit Texas while DraftKings opted to stay and fight when Texas AG Ken Paxton announced he considers fantasy sports to be gambling under Texas law.

DraftKings is also known to spend more on marketing to grow market share and to experiment with new contest formats that blur the distinction between legal fantasy games and something else. So far, those risks have paid off for DraftKings as it now leads FanDuel in terms of users and prize pools.