A patchwork regulatory framework. Take a look at what's going on with online poker. Any poker site that wants to operate in a state that allows it has to comply with that state's regulatory framework. One of the most notable things about this is that states generally only allow you to play players within your own state (I think some states may have compacts that allow inter-state play with other specific states). They may also require the company to be operating within the state itself. So, even if Draft Kings starts a normal bookmaking operation, they can't necessarily just offer those services to players in any state that allows it. A lot of it will depend on how states settle on their regulations.
I just got an email from DraftKings about how stoked they are to make betting through their app completely legal. So I think they are already planning to get it done.
This decision doesn't legalize sports betting. It allows the individual States to do so if they wish. DraftKings is (was?) operating under a loophole in Federal law that allows fantasy sports, and had, until now, the advantage of actual betting being illegal while "fantasy sports" were not.
Now that states can allow betting directly, they can do things like require a gaming license to operate, require a physical location, etc. Many may still prohibit online gambling. Federal law that prohibits online gambling can still also prevent straightforward betting over the Internet.
Nothing, assuming states pass laws legalizing sports wagering in which Draft Kings and the like operate.
The major problem I see is that while the current DK business model must be extremely profitable (just hosting contests that you don't have a stake in and taking a rake), running a sportsbook is an entirely different business. One that typically brings minimal profits and can sometimes bring enormous losses because now they are taking the action themselves. Sportsbooks are not typically profit centers for casinos but loss-leaders to bring in people to buy drinks and gamble on more profitable games.
I'm sure they must have been worried about this happening but probably will try and get out in front of it to become an online bookmaker. My own hot take is that this cannot be viewed as anything but a negative for them. I have to believe it would be very difficult to compete with huge casinos that can build their own platforms and bundle betting with their rewards programs. I also agree with the OP's assumption that most people currently using daily fantasy sites would much prefer to simply bet on games.
>One that typically brings minimal profits and can sometimes bring enormous losses because now they are taking the action themselves. Sportsbooks are not typically profit centers for casinos but loss-leaders to bring in people to buy drinks and gamble on more profitable games.
While this is true for places with competition among sportsbooks, like, say Nevada or the internet, it's not necessarily true for the states. If they start running a sportsbook (either themselves or, more likely, through a contractor) with a monopoly in their particular state, then they'll be able to charge more per-bet than they otherwise could. Instead of the standard 11:10 line, they could charge 12:10 or even 13:10 and they'd still get gobs of bettors wanted to put money down at the only legal game in town.