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Active Signal

DraftKings used ML to target losing bettors and shelved problem gambling tools

Source: New York Times
Time: 8:50 PM
Weight: 95/100High importance
How is it calculated?
A 0–100 editorial signal score. Higher scores carry more weight on the timeline.

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What happened?

DraftKings has utilized machine learning—a type of artificial intelligence that identifies patterns in data—to target customers most likely to lose money with specific betting incentives.

Why it matters

According to a New York Times investigation and internal documents, the gambling giant developed a model in 2023 to analyze customer records and prioritize promotional bonuses for users with the highest loss potential.

Original Source

Detailed explanation

This practice matters because the data patterns that indicate a profitable customer for the company often overlap with the behaviors of those suffering from addiction.

While DraftKings has successfully refined its data science to maximize revenue from losing bettors, former employees told the source that the company has simultaneously stalled or squashed efforts to use similar technology to predict and protect users at risk of developing gambling problems.

The transition to smartphone-based gambling has provided the company with an extraordinary wealth of digital interaction data, which it uses to assign each customer a score based on their habits.

This technical mechanism determines who receives phone alerts and "free" bet offers, with higher scores reflecting a greater expected loss for each promotion.

While these targeting methods are continuously honed, former staff members report that internal tools designed to identify problem gambling remain sidelined.

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