Is India the land of Fantasy Sports Market?
india-fantasy-sports-market
May 11, 2023
India is undergoing rapid digitalization with over 1 billion smartphone users in the country. Presently it has over 467 Mn Social Media Users and Smartphone Penetration stands at ~61% of the Total Population.
With, the high smartphone penetration rate and low-cost internet data, the Indian Fantasy Sports industry’s footprint in India has grown tremendously. Additionally, customer acquisition is growing rapidly in the sports-obsessed nation.
From our report, we have extracted the key points that have been boosting the growth of the Fantasy sports market in India and making the country leader of the fantasy sports world.
1. While Covid-19 led to a General Economic Slowdown, the Pandemic has accelerated the adoption of Digital Platforms, especially across Various Consumer Facing Sectors in India
Impact of Covid-19 on Digitalization1
- COVID-19 pandemic, with the Indian GDP estimated to have shrunk by 7.7% between April 2020 and September 2020.
- Industrial and services sectors were severely impacted
- Lockdown accelerated digital adoption with data usage in India in CY20 increasing by 34% vis-à vis CY19.
- The time spent on mobile and application downloads also witnessed increases of 31% and 21% respectively in CY20 (vs.CY 19)
- Apps across various consumer categories witnessed accelerated adoption.
- Number of subscriptions for videos saw a considerable increase along with the number of subscribers over the year
Video Subscriptions in Mn
| In Mn |
CY 2019 |
CY 2020 |
| Subscribers |
11 |
29 |
| Subscribers |
21 |
53 |
Source: Interviews with Experts & Veterans, Industry Articles, Company Websites, Ken Research Analysis
2. The Lean Period of Covid-19 Pandemic and Lockdown was used by Online Fantasy Sports Operators to Innovate their Product Offerings and Business Strategies to overcome Affected Cash-flows
Introduction of Relatively Lesser Known Leagues and Sports on Platforms
- While the major sports leagues around the world were hampered, the top OFS operators moved on to add secondary markets' leagues, which were comparatively less impacted by the ongoing pandemic.
- Despite the fact that these products were still relatively new to the Indian market, industry discussions suggest that there has been some interest in these leagues, albeit not on the same magnitude as Indian leagues.
Streaming Sporting Action on Associated Sports Content Platforms
- FanCode and Dream11 made a concerted effort to make international sporting events that were taking place during the pandemic accessible to Indian fans.
- Under its SportsTiger platform, MyTeam11 obtained non-exclusive global streaming rights for the Vanuatu T10 League and exclusive global streaming rights for the Taipei T10 League.
- Platforms have aided in the recovery of some of the user engagement that had suffered during the pandemic and have offered sports-related content to fans who were without any way to participate with sports in general, including watching or playing online fantasy sports.
Introduction of Quizzing
- Each quizzing cohort comprises 4-5 people, and the quiz topics are scattered throughout genres. These games are quiz-based and work in a similar manner to the OFS in terms of participation and platform fees. The user who correctly responds to the most inquiries wins the pool.
- The inclusion of quizzing broadened the target market beyond supporters of a particular sport. Increasing the participation of female users on the platform, one of the industry's pre-COVID-19 difficulties, was afterwards aided by this.
Innovations around Offerings
- Dream11 concentrated on creating a sports social network on the platform, revisiting non-user-focused aspects that were no longer necessary to cut down on duplication.
- The ‘Responsible Gaming feature that Faboom launched gives its customers access to features like self-determined exclusion tenures, the choice to set deposit limits (daily & weekly), and contest participation limits.
Source: Interviews with Experts & Veterans in India Fantasy Sports Industry, Industry Articles, Company Websites, Ken Research Analysis
3. The fantasy sports Industry was in India for the last two decades but the market gained huge momentum after the Internet Revolution in late 2016, resulting in the rise of Online Mobile Gaming
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I: Emerging Phase <2016 |
II: Growing Phase 2016 - 2030 |
III: Maturity Phase >2030 |
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Market Size
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The market started to take online gaming seriously with a variety of titles available to players, regardless of limits, with the availability of PC-based internet gaming and the rising popularity of consoles in the late 2000s and early 2010s. |
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Emerging Solutions |
Product Offerings
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One of the first fantasy games in the nation to gain user traction was the "Super Selector fantasy game" that ESPN-Star Sports introduced in 2001. Over time, additional well-known competitions including the English Premier League, UEFA Champions League, ICC events, and IPL created games that let players manage their teams for certain competitions. |
With robust distribution through app stores and growing focus of Indian developers to provide high quality content, fantasy sports has matured significantly, on the back of technology infrastructure development through availability of high-speed internet and affordable data prices post the launch of 4G services by operators, and rapid growth in digital payments in late 2016. |
The Indian fantasy gaming industry is set to be on a high growth trajectory, with rapid digitalization and transformation, increasing internet usage and rising smartphone penetration.
Companies will seize the opportunities ahead which include cloud gaming, eSports, introduction of 5G and the use of blockchain to maintain player trust. |
Competition
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Over 60 years have passed since the invention of fantasy sports, which were first offered in India in 2001 and wounded up in the late 2000s. |
Launch of new Fantasy Sports platforms: From less than 10 operators in 2016, to 140+ operators at the end of 2019. |
There will be several new players on the market with the partnerships and acquisitions to diversify the products |
Source: Interviews with Experts & Veterans in India Fantasy Sports Industry, Industry Articles, Company Websites, Ken Research Analysis
4. As a result, the Fantasy Sports Industry in India grew at a CAGR of ~164% over the period of FY’2017 – FY’2022 with Companies competing Intensely on providing a Plethora of Options Under One Roof
Market Overview
- Industry is in the Growth stage, growing at a CAGR of ~164% during the period FY’2017 – FY’2022.
- The growth in sports leagues has increased the consumer demand for fantasy sports in India.
Nature of Competition
- The fantasy sports industry is moderately fragmented with a top 5 FSPs contributing to over 90% of the market revenue and many global & local players.
- Due to technological developments, companies are expanding their market presence by developing new and secure product offerings to the consumers
Product Offerings
- Cricket is very high in demand for fantasy sports in India.
- The highest share of revenue generation comes from the contest entry of Cricket, followed by Hockey and Football, and from consumers paying to play from Metropolitan cities as of the year FY’2022.
Growth Drivers
- Rising attention of the operators towards ensuring responsible play on their platforms and the overall potential and ability to drive economic and technological growth.
- Automation technologies in fantasy sports platforms, e.g., cloud gaming, Artificial Intelligence, Machine Learning, Facial Recognition, Blockchain and 5G technology, will increase the consumer demand in the coming years.
Industry Challenges
- Ambiguity and multiplicity of regimes and low barriers of entry leads to possibility of unregulated Fantasy Sports Platform launched that skirts the definition of chance and skill, resulting in lawsuits or negative publicity, tarnishing current players’ reputation.
- The reach that Fantasy Sports Platforms want to have is impacted by the inability to provide an application via direct download from the Play Store because certain users might feel uncomfortable eschewing more conventional and secure download methods.
Source: Interviews with Experts & Veterans in India Fantasy Sports Industry, Industry Articles, Company Websites, Ken Research Analysis
6. Growth in Digital Infrastructure, Increase in digital transactions via Payment wallets & UPI, and the Growing popularity of Sports Leagues are some of the growth drivers of the industry
Growth in Digital Infrastructure – Internet & Smartphone Penetration
- The launch of Jio's low data plans in 2016 and the simultaneous growth of smartphones and mobile broadband internet in India, as well as the introduction of smart feature phones by Jio and other 10 players, have emerged as key drivers for the expansion of Online Fantasy Sports in India.
- The number of smartphone users in India has been increasing at a CAGR of ~13% from FY’2017.
Increase in digital transactions via Payment wallets & UPI
- The expansion of paid users of Online Fantasy Sports in India has also been facilitated by the growing user adoption of digital payments and the development of user-friendly payment methods like payment wallets and UPI.
- Over the period of FY2017–FY2022, the volume of transactions on UPI and digital wallets increased at a CAGR of ~381%, facilitating frictionless platform use by OFS users.
Growing popularity of Sports Leagues
- The IPL's popularity was fueled by its location-based franchisee format, which changed the Indian audience's affiliation with the teams and the viewership pattern of sports leagues.
- Authorities of other sports modelled leagues like Pro Kabaddi, Indian Super League (ISL), etc. in a similar league-format to capitalize on the growing popularity of league-based games among the Indian audience. These team sports have gained more widespread appeal as a result of being included in league formats.
Reaffirmation of the legality of the Fantasy Sports format in India
- Legal precedents in India have determined that a particular Fantasy Sports format available on OFS platforms favors skills over chance and have concluded that this format qualifies as "games of skill." The Indian Public Gambling Act of 1867 does not apply to the format that Online Fantasy Sports platforms in India offer, according to further clarification from the courts.
- Further, courts have specifically accorded the protection to the right to free trade and commerce guaranteed.
Source: Interviews with Experts & Veterans in India Fantasy Sports Industry, Industry Articles, Company Websites, Ken Research Analysis
7. Additionally, certain initiatives by the Government like a ban on Chinese applications and AtmaNirbhar App Challenge are creating opportunities for Fantasy sports to thrive in the Indian market in the future
Initiatives to Promote Online Fantasy Sports in India
Government Initiatives
Ban on Applications from China
- India's recent ban on multiple Chinese applications, including many well-known multiplayer action games, is certain to open up new opportunities for domestic game creators, giving them a huge chance to capitalize on the supply gap.
AtmaNirbhar App Challenge
- The AtmaNirbhar app challenge recognized gaming as a category in which encourages the indigenous developers. The Ministry of Electronics and Information Technology and NITI Aayog's AatmaNirbhar Bharat Innovate Challenge is intended to bring more complex gaming apps to the market.
Foreign Direct Investments
- The success of local stakeholders, the fantasy sports market's exponential development trajectory, and its potential have piqued the curiosity of overseas investors. Several foreign investors have already invested in numerous fantasy sports platforms, and the growing popularity of these platforms will undoubtedly continue in the future years.
NITI Aayog Guiding Principles
- Niti Aayog has created guiding principles that will provide the necessary incentive for India's online fantasy sports business to grow responsibly. It would also ensure that all operators have equal opportunity while safeguarding consumer interests and preventing any potential fraud.
Source: Interviews with Experts & Veterans in India Fantasy Sports Industry, Industry Articles, Company Websites, Ken Research Analysis
