It started as a simple game played by friends. Today, it is a multi-billion dollar game with a massive impact on real sports. Many companies involved in professional sports have also jumped on the fantasy bandwagon. Time Warner, for example, has invested heavily in FanDuel, an established fantasy sports company.
The Ins & Outs of Fantasy Sports
It involves online betting games in which a person sets up a virtual team of real players. Based on real-life stats, players earn points that are converted into fantasy points. If your players perform well, you will earn more fantasy points. You play against other leaders and their teams.
How Fantasy Sports Work
Fans select real players from a draft or online selection process to create a fantasy team. The players’ real game stats are recorded and analyzed to see which fantasy team performed the best. Players monitor the performance of their teammates through various mobile apps and websites. Some players team up with their friends to form a team and then only compete against opponents they know, while others join public leagues and play against strangers.
Who Plays Fantasy Sports?
In North America, approximately 56 million people play fantasy sports. 18% of these players are teenagers. According to STATS Inc, about 19% of adult men and 9% of women play fantasy sports. People with a lot of money are more likely to play fantasy sports.
Approximately 16% of people with incomes of at least $50,000 play fantasy sports, while 10% of those with incomes of less than $50,000 play fantasy sports. People spend about $18 billion on fantasy sports leagues each year. By comparison, $70 billion is spent on lotteries, while $140 billion is bet on real sports.
How Big Is the Fantasy Sports Business?
The fantasy sports industry is big. In general, it generates about $1.5 billion in revenue each year. Most of this revenue comes from advertising on websites. Platforms like FanDuel and DraftKings pay out over 90% of the fees collected as prize money to attract more players. Most of the established internet and media firms like Yahoo (YHOO), CBC (CBS), and Disney’s (DIS) ESPEN unit have become major players in the industry.
FanDuel and DraftKings have each received about $300 million from investors. Their valuations are in the billions. The largest investors are the National Basketball Association, Major League Baseball, the National Hockey League, and the owners of NBA and NFL clubs.
Which Is the Fastest Growing Area of Fantasy Sports?
FanDuel and DraftKings have become popular recently because they offer daily games. Here, players pick a team for a single day; in soccer, they pick a team for a week. North America is by far the largest fantasy sports market, and the Asia Pacific is catching up. Analysts predict the market to reach $38.60 billion by 2025.
Is Fantasy Sports Legal?
Fantasy sports are legal in the United States under federal law, which designates it as a game of skill and thus does not classify it as gambling. The first law declaring fantasy sports legal was passed in 1999. The most recent changes were made in 2006.
While fantasy sports are legal under federal law, state laws may prohibit the activity. These laws range from regulations to consumer protections to outright bans. Some games, particularly daily fantasy sports, are not allowed in some states due to their laws.
Make sure you read and understand the rules for fantasy sports leagues in your state before signing up for a league. You do not want to get in legal trouble for your hobby. If you participate in a state that restricts fantasy sports, you could forfeit your winnings and be sued.
Play Fantasy Sports Responsibly
Being financially aware and responsible is important so that betting on your ideal fantasy team does not turn into a nightmare. Here are some tips to help you play fantasy sports responsibly:
- Create a Budget
To avoid financial problems, it’s crucial to create a budget and stick to it. If you know you have a limited budget, you can be more careful.
- Manage Your Time
Just like money, you can also easily lose your time, so make sure to plan well. Before joining a fantasy sports league, consider how much time you want to spend on your fantasy team.
- Work With a Credible FS Provider
New fantasy sports are hitting the market every day. Do your due diligence before signing up with a site. Only work with a reputable and well-known league.
There are numerous benefits of playing fantasy sports. As 2021 continues to rumble, time will tell how fantasy sports will change the way fans interact with their favorite sports.