IndiaTech.Org ventures into Online Fantasy Sports; adds value to the Indian sports ecosystem

IndiaTech.Org, a non-profit organization has ventured into India with the objective of building the world’s largest and the most successful internet commerce ecosystem in India. The organization serves as a collaborative platform for Indian consumer internet companies and their investors with cutting-edge research, thought leadership, policy advocacy, promoting local entrepreneurship, thereby maximizing India’s potential in the internet space.

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It has unveiled the findings of its white paper – ‘Online Fantasy Sports: Adding Value to the Indian Sporting Ecosystem’. The paper brings to light the playing pattern of OFS users, the current regulatory landscape, misplaced perceptions plaguing the industry and the positive impact of the industry on Indian sports and the overall economy.
The white paper states that 80% of the online fantasy sports (OFS) users prefer participating in the ‘free-to-play’ format and 98% of the 20% who ‘pay-to-play’, have either won or lost less than INR 10,000 net in their lifetime (past 3 to 4 years). This reinforces the fact that fantasy sports are a competitive digital sports engagement platform and clearly not in the nature of addiction. The average ticket size of the participation in the pay-to-play format is usually as low as INR 35/- (typically the cost of a snack). It is explicit that Fantasy sports are unlike all forms of online games that do not need a real-life player to be actually playing a real sports match to decide the outcome for the participant. The very fact that it is dependent on actualities, seasonality and availability of real-time sports matches makes it a non-addictive form of play which sets it distinctly apart from online games that are commonly perceived to be in the nature of gambling and/or betting.

“In the last few years, fantasy sports has certainly become a potential sector that has performed exceptionally well and boosted the consumption of sports in India. As a legally approved format of sports fan engagement, the industry is self-regulating to protect the users and operators through FIFS. There are multiple perception issues the industry has to overcome to reach its full potential as a non-addictive and skill-based platform,” said Rameesh Kailasam, CEO, IndiaTech.

The format of fantasy sports ensures that sports enthusiasts follow the game more keenly and this directly results in increased focus and attention towards sports. This contributes to increased viewership & higher sports fan engagement that naturally contributes to more qualitative investments.

Fantasy Sports as a sector is represented by Federation of Indian Fantasy Sports (FIFS), a self-regulatory body incepted in 2017. FIFS has a defined Charter which outlines a framework within which the industry must function. Self-regulation has so far proven adequate for the industry and the focus shall be towards ensuring that the effectiveness of self-regulation continues with government recognition, as more players add to the ecosystem.

Key findings of the report:
1. 80% of the active users are playing Online Fantasy Sports for free
2. 20% engage in a pay-to-play format and the average ticket sizes are as low as INR 35/-
which is the typical cost of a snack
3. 98% of these 20% users who participated in the pay-to-play format of fantasy sports have either won or lost less than INR 10,000 net in their lifetime (past 3 to 4 years)
4. It is explicit that fantasy sports are not like any other form of online gaming. The very fact that it is dependent on actualities, seasonality and availability of real-time sports matches
makes it a non-addictive form of play which sets it distinctly apart from other forms of
gaming that are perceived to be in the nature of gambling and/or betting
5. The most active set of fantasy sports users lie in the age group of 25 to 40 years of age who treat fantasy sports as a means of online entertainment
6. OFS is a game of skill where a player needs to constantly learn, practice and refine skills to be able to perform in a contest
7. The income tax outlay due to direct employment by Online Fantasy Platforms and operators in FY 2019 amounted to INR 43 cr, which doubled to INR 81 cr by FY 2020
8. Fantasy sports as an industry has attracted significant amounts of FDI in India. In 2018 and 2019, the industry attracted FDI of INR 1,500 cr (approx.) and has been growing
exponentially.

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