The Gambling Companies Need Their Customers’ Misery

Over the weekend, The New York Times published an investigation into DraftKings. The upshot of the investigation is that this obviously exploitative and profit-driven company exploits its customers in the pursuit of profit in all the ways that you might have feared. The story features on-the-record testimony from former DraftKings employees who say that the company not only built tools to identify customers who are most likely to lose and entice them to keep betting, but also shut down projects that could have helped the company identify potential problem gamblers more easily. One source, a former data analyst named Jayden Butts, told the Times that he was tasked with testing a machine learning model that was able to not only identify which customers were most likely to be convinced to gamble with promotions and free bets, but target those most likely to lose those bets. From the Times:

The core question was, “Is this person going to give us more than we’re giving them?” Mr. Butts said. “And if the answer is yes, open the floodgates.”

[…]

Data scientists had trained the new casino model on historical data. It was Mr. Butts’s job to test it on real customers. Each week, the model vacuumed up information about a user’s recent activity. The score it calculated was known internally as “elasticity,” a term borrowed from economics.

Users with below-average scores were deemed “inelastic” and marked for fewer incentives. The “elastic” bettors remained.

Two other former employees told the Times that when they raised concerns that customer-targeting initiatives like the one Butts worked on could potentially exploit problem gamblers, they were told not to put any protections in place.