The Economics Of Fantasy Leagues


Source - The Indian Express

The IPL season finds every India Sports Lover glued to their TV screens. 

Taking advantage of this undistributed attention of the viewers, the Sports Channels have started endorsing fantasy league games, primarily, Dream 11, an online gaming app, where you’re free to create a team from amongst well-known cricketers and then play to win. Winnings are in form of money, cash or credit, but so are the registrations.

The aggressive advertising of these fantasy leagues is bound to catch the attention of even a passive- television watcher, because of the creativity that goes into the key-word phrases used to float the Ad in the public domain.

Words like “Play and Earn” or “Making Easy Money”, is a sure shot way of attracting users, some of whom are just a click away from downloading the app and are eager enough to try their luck right away.

Of course, what these Ads don’t tell us or tell us in an incoherent way is that Fantasy Leagues are subject to risk just like any other market investment. It is extremely volatile and you can end up losing a lot of money if you’re not careful it.

How did it gain popularity?

Fantasy games have been around for a while now, but their true potential was enhanced during the period of a severe nationwide lockdown.

Sports Fans had nothing to do and were idle at home owing to the fact that matches and most-awaited tournaments of the year had either been postponed indefinitely or cancelled.

This provided a motive for the application creators, to lure the idle fans into something not only related to the sport they love and enjoy but also give them an opportunity to earn by showcasing their skills and reading trends, which they may have learnt from the incessant match binge-watching.

Now, that major leagues and tournaments have resumed worldwide, the fantasy sports league seems to have received a further boost because the fans want to try their hands at skillfully earning money whilst also enjoying the process of gaming.

How do Aggressive Advertisements help?

Every strategic time-out of the ongoing IPL airs the Dream 11 advertisements which are endorsed by exceedingly successful players like M.S Dhoni and Rohit Sharma

These Ads with their creative and celebrity appeal hold onto the attention span of the viewers, which often converts into revenue for the app.

Fantasy gaming currently holds the position of the 3rd Most Profitable Business in the world, and a lot of it credit goes to the aggressive advertisements on prominent sports channels with an excellent TRP.

The budget allocated for the Ads is recovered in an almost unfathomable way, and for that we need to understand the procedure of how the Fantasy League operates, and how money invested in it grows or sinks

Procedure:

The entire process begins with paying a nominal entry fee to the application in order to start the game.

You then create a team with players of your choice, and win points.

The app, then ranks you on the basis of your points.

Then, you win or lose money according to your rank.

The computation of gains/losses

The Fantasy Games are a simulation of the stock market.

Just like every company pre-decides the number of shares allotted to the masses and the price per share, similarly, the fantasy league has a fixed fee for registration with a pre-determined number of entries.

The pool of money collected is colossal in comparison to the prize money that is distributed. This extra money is the real profit of these games.

The winnings on the application are as good as illusional winnings at a casino. You may be winning at some point, but the real benefactor is and always will be the Casino (in this case Dream 11)

The Fantasy game industry is only getting started, If government restrictions are eased, there will be no stopping them from taking over the sports and gaming industry, because after all its perceived as a money-making instrument when what it actually should be viewed as is a budding addiction.  

 

Written By - Tushna Choksey

 

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