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DraftKings Inc. (NASDAQ:DKNG) shares are trading lower Tuesday after NCAA President Charlie Baker blasted college prop betting prior to the NCAA men's championship game between UConn and Purdue.
FanDuel parent company Flutter Entertainment PLC (NYSE:FLUT), however, is trading 3.24% higher at last check.
What Happened: According to the Associated Press, Baker — who has been increasingly vocal about a gambling ban on individual performances for college athletes — called out cable TV partners for detracting from University of Iowa player, Caitlin Clark, with prop betting analyses.
"Did any of you notice how much time is spent on cable TV about Caitlin Clark's prop performance in the first game, and leading into the second game?" Baker reportedly said Monday. "Is that really what we should be talking about in the middle of a women's Final Four? My answer is no."
Clark and her team, the Iowa Hawkeyes, are credited with helping to elevate women’s college basketball in popularity over the last four years.
Sunday’s NCAA tournament national title game between South Carolina and the Hawkeyes broke records, averaging 18.7 million viewers and peaking at 24 million, per Nielsen data.
The fact that attention was spent on prop betting irked Baker. Prop betting for college athletes, he argues, is "enormously problematic."
Why It Matters: Prop (proposition) bets allow spectators to wager on how a player performs. For example, DraftKings offered betting on whether Clark would break the all-time three-pointer record.
Critics say the prop bet craze, heightened during high-profile events like March Madness and the Super Bowl, is an added ick factor to sports.
Baker has also pointed to the issue of student-athletes getting trolled by so-called fans who lost on bets. For instance, angry bettors harassed North Carolina Tar Heels’ Armando Bacot on social media earlier this year.
“I thought I played pretty good last game, but I looked at my DMs [direct messages], and I got over 100 messages from people telling me I sucked and stuff like that because I didn't get enough rebounds,” he said.
North Carolina legalized online sports betting on March 11, joining 37 other states where it is legal.
Baker said the NCAA has hired a company to conduct surveillance work on social media to crackdown on the bullying.
"And if they see stuff that they're really worried about, they notify the authorities,” Baker said. “And that's happened in a few instances."
There’s also the added stress that a prop bet could get fixed and compromise the integrity of the game.
Still, companies like DraftKings and FanDuel continue to cash in. DraftKings, in February, posted quarterly results that missed Wall Street estimates. However, the company increased its revenue to $1.23 billion, up by 44%.
And Flutter, which acquired FanDuel in 2018, has ballooned into the world's largest online gambling group with a market cap that exceeds $27 billion.
Now Read: DraftKings Gains New Bullish Analyst: ‘We Believe The Earnings Power Of DKNG Is Underappreciated'
Image: Midjourney
