Fantasy football has taken some by storm with its unstoppable growth and popularity over the years. What started as an office pool with a relatively small jackpot has grown into millions of users in the US and Canada. With this outburst of growth showing no signs of slowing, the question is whether this fantasy league has a legit business model or is falling more into the gambling sector. Governments around the world seem to agree with the latter mostly, and are now beginning to look for ways to regulate the entire industry.
Some say that the government always wants a piece of everything, and that may be true. But Fantasy Sports Trade Association, or FSTA, collectively has revenues exceeding the NFL, at just under 10 billion per year. It’s total worth from all sources has been estimated anywhere from $40 Billion to $70 Billion, which is way more than any individual team. The Dallas Cowboys are worth only an estimated $4 Billion in comparison. It’s also not hard to attract the attention of the IRS when you’re creating millionaire weekly, and have thousands of high-earners. How can they generate this type of revenue from small office pools and traditional gaming bets?
Here’s where the clear picture gets cloudy when looking at the Fantasy Football platform. It’s built on a structure where you are not actually bidding on any particular team or player. Instead, you win from the statistics produced from a team that you create and players you choose. Your individual bet goes into a collective pool from which prizes are dispersed to the winners according to their investment level. We know that if you were betting on the results of the real teams and players in the same way, that it is considered gambling, without a doubt. So yes, it can be a bit difficult to distinguish between the two..
Let’s take a moment to review how fantasy football compares to gambling, and some of the the notable similarities between them. I’ve listed 5 reasons fantasy football is really just like gambling:
Instant gratification – It’s no longer good enough to choose the right team or favorite player, and watch them win for your bragging rights. Now, you need to build your own team, and play your own game, and personally win because of your own choices. And people want to win, and they want to win right now. The real winners and losers on the television don’t matter, as long as they can say they won.
House wins – Everyone knows the one rule of gambling, and it’s that the House always wins. Well this is looking like the case here, as major companies like Draft Kings and FanDuel sets record profits, continue to face double-digit growth, and raise millions from investors.
Options – It’s similar to when you walk into a Casino. You may have $50 or $5000 to start with, but you are there to win more. Luckily there are options as low as $1 or $2 so everyone can join in the fun and noone has to be left out. Every week, there are lots of six-figure winners and there are thousands of smaller prizes given out weekly. It’s even exciting to hear about the action if your not playing.
Addicted compulsively – If you win, it’s great and you automatically get the bragging rights for your picks. If you loose, you accept it and move on. It’s not the end of the world. After all, it’s all in the game and now you just need to keep playing to offset your losses. There are also plenty of free incentives to keep playing, especially if you invite your are likely to spend money eventually or invite your friends.
Depression and anxiety – Another common symptom of gambling, and one to look out for in the future of Fantasy Football. When you win, you win big, and when you loose, you loose big. This pattern in itself, along with your lack of control of the outcomes, is enough to cause depression and anxiety in most individuals. People are already usually down when their team loses in real life, but when your “fantasy” team is connected to your heart and wallet, it can be just as bad or worse. So even in the fantasy world, there are still real life implications
The stunning part of this phenomenon is the potential it opens up for the future. There may be trends building to carry the success over to other sports in the U.S., like basketball and hockey. We’ve seen some of this happen before with the lottery and online poker, and it’s transition into government control and regulation. Today, there are multiple companies that are heavily invested in both so much that they’ve gone mainstream, ultimately providing a plethora of options for everyone to play. And it’s looks like Fantasy Football may be on this path.
So do these things necessarily equate fantasy football with gambling? Maybe the word “fantasy” is there for a reason because it seems to explain a big portion of what’s really going on here today. People are willing to subject themselves to extraordinarily uneven odds, with the hopes of making out big. And if they loose, they’ll get better, keep playing, and invest more next time. Therefore I say, let’s just call Fantasy Football gambling.