More than 80% of the users on fantasy sports platform Dream11 have never played cash contests on the platform, cofounder Harsh Jain said on January 11.
"There are 120 million people playing fantasy sports on Dream11. Almost 100 million people have never played for money. They only play for free. So this isn't a game about winning or losing money. These people play because it helps them engage with the sport that they love" Jain said during a fireside chat with Koan Advisory Group partner Vivan Sharan at the 16th India Digital Summit hosted by industry body Internet and Mobile Association of India (IAMAI).
Jain said that fantasy sports allow users to be an active participant in a sport, by engaging and competing with their friends and family.
"With fantasy sports, we've seen a drastic increase in the number of Indians participating in tier two and three cricket (tournaments) and sports outside of cricket, like Kabaddi, basketball, hockey, football, handball, and volleyball," he said.
Jain said since consumers have a chance to make a team and compete with people, they end up watching matches or parts of matches that they wouldn't otherwise. This changes the engagement completely and leads to a drastic shift in sports engagement and viewership, which also leads to better commercialization of sports, he said.
Read: 2021 was the year people in India started spending money on mobile games
That said, the fantasy sports industry has faced challenges around its legal status across various parts of the country. While the Supreme Court had upheld fantasy sports as a game of skill in July last year, several states including Andhra Pradesh, Telangana, and more recently Karnataka have banned games of skill where transfer of money is involved. Companies however can continue to offer free-to-play contests to consumers.
Weighing on this topic, Jain said the Supreme Court "has for once and for all, said that the format offered by Dream11 and approved by the Federation of Indian Fantasy Sports, a self-regulatory industry body for fantasy sports, is approved and this case has reached finality, it is no longer res Integra"
"What's also happening is that people are broadly, mischievously, using that, and launching (game) formats akin to gambling in my opinion, and saying this is also fantasy cricket. We are working with the government to be a little stricter on exactly what is allowed and what is not allowed by the court, to regulate this sector and to enforce the same" Jain said.
He also noted that fantasy sports is not gaming, but a game of skill just like cricket or football.
"There's a lot of confusion on fantasy sports and gaming. In fantasy sports, you pick a team, and then you're done. There is no virtual gaming or simulation, and it's also not available 24/7 and therefore, no addiction. If there are no sports matches going on, fantasy sports is not available. Gaming, on the other hand, is kind of the opposite since you can play it any time" Jain said.
Emerging new business models
Jain said that play-to-earn is emerging as a new business model in the gaming sector, following the success of Axie Infinity, an NFT-based game developed by Vietnamese studio Sky Mavis.
"What we've been doing all this time is play-to-win but now there's an entirely new model being built around play-to-earn, which I think is phenomenally interesting since you don't have to stake something that you can lose. You can only lose an opportunity to gain something" he said.
Moneycontrol had reported on December 24 that the emergence of blockchain-based and NFT-based gaming firms is expected to be one of the key trends in the sector in 2022. On January 7, Jain had said during an industry event that they are exploring a foray into the nascent Blockchain and NFT (non-fungible token) market.
"I think there's a big question whether the world is going to start adopting play-to-earn as a business model versus play-to-win, which is what we do today. But regardless of any buzzwords or fad, I think blockchain and tokenization is here to stay and we're going to see those implementations changing multiple industries on its head over the next couple of years" Jain had said at the time.
IoT (Internet of Things), augmented reality (AR) and virtual reality (VR) will also play a big part going forward in the sports sector, as there is an increased focus on providing consumers an immersive experience, he said.
Dream Capital
Over the years, Dream11 has diversified under a new structure as Dream Sports that houses brands such as sports content and commerce platform FanCode, its corporate venture and M&A arm Dream Capital, sports experiences platform DreamSetGo, game publisher Dream Game Studios, and payment solutions provider DreamPay, apart from the flagship fantasy platform.
It claims to have a user base of over 140 million users across its ecosystem of products and employs close to 1,000 people.
In August last year, Dream Sports had earmarked $250 million to Dream Capital that has built up a portfolio of around 10 early-stage startups including Fittr, SoStronk, KheloMore, and Elevar.
"The whole idea of Dream Capital is to have patient capital to grow this entire sports tech ecosystem in India and expose these younger companies to 120 million users on Dream11 and 140 million users on our ecosystem," Jain said during the session, "I think, we need entrepreneurs who will step up and put a few years into it, and show product-market fit. And then companies like Dream Sports can come and fund them to grow them and scale them"
Read: Dream Sports CEO Harsh Jain gives a peek at their NFT ambitions & diversification strategy
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