Daily fantasy sports saw a significant slowdown in growth for 2916, but still managed an about four percent uptick in revenues to .26 billion.
According to an annual market study released Friday by research firm Eilers & Krejcik Gaming, DFS players spent an estimated $3.26 billion in 2016, up about 4 percent from a year earlier.
By contrast, in 2015, entry fees in DFS contests grew by 222 percent, according to the report.
DFS sites—especially market leaders DraftKings and FanDuel, which are presently attempting a merger—had a difficult 2016 as the industry fought state-by-state battles for legality. To date, only about 13 states have formally legalized DFS games.
Still, DFS revenue did increase.
“It’s not bad, in light of the regulatory headwinds and the reduction in sales and marketing,” said Adam Krejcik, the report’s lead author according to the Boston Globe. “There are so many variables that it’s tough to say. But basically, we’re saying that you’re not going to see 200 percent growth year over year.”
Eilers & Krejcik predict annual growth through 2020 will probably range between 5 and 15 percent.
The roughly $3 billion in player fees reached in 2015 is now likely “a nice, sustainable floor for the business,” Krejcik told the Globe.
DraftKings said the increase was a positive sign.
“While still nascent, we are pleased to see additional affirmation that the fantasy sports industry continues to grow and evolve,” DraftKings said in a statement.
