"Sabse pehla sapna toh yeh hai ki ghar bane apna khud ka (The first dream is to build a house of my own),” said Shahabuddin as the cameras clicked away in the background. Last month, the autorickshaw driver from Sendhwa, Madhya Pradesh, found himself plucked from obscurity and thrust into the spotlight, fielding questions from the biggest media outfits in the country. For, on 1 April, Shahabuddin, who invested ₹49 in a paid contest on the fantasy games app Dream11, won ₹1.5 crore at the conclusion of the Kolkata Knight Riders vs Sunrisers Hyderabad game in the Indian Premier League (IPL). His story fit the rags-to-riches template so perfectly that virtually every news channel descended upon Sendhwa for a piece of the action. The man himself could barely believe his luck. He had started playing real-money games on Dream11 in 2020 and three years later, his day of glory was here.
In 2020, lockdowns forced a lot of us to try things for the first time, mostly in a bid to keep ennui and cabin fever at bay. For me, one of these things was fantasy sports, specifically the season-long game on the IPL website (fantasy.iplt20.com) constructed by Dream11, India’s biggest fantasy sports firm.
The concept was simple. Dream11’s “daily challenge” (which had a lot of money attached to it) involved selecting 11 players for every single IPL game, trying to maximise your points. The season-long game, however, wasn’t played for money. Every run was a point, every wicket was 25 points and there were bonuses for all kinds of things, like hitting the wickets outright (for bowlers) or hitting at least 30 runs (for batters). Substitutions would be locked in once the first ball of the match was about to be bowled and a finite number of substitutions were allowed throughout the tournament, which made this a classic “resource allocation problem”, the maximising of a linear equation with a relatively large number of variables. As a lifelong math nerd, I was hooked.
Besides, in 2020 it was my elder brother who had urged me to join the “league” he had formed with his old college friends. A welcome distraction and a chance to rekindle (good-humoured) sibling rivalry? Amen to that, I said, and for 30-40 minutes every day, I would weigh the pros and cons of picking, say, Glenn Maxwell over Virat Kohli, Kagiso Rabada over Jasprit Bumrah. I went on to play the entire season-long game that year and I have played every year since.
According to an April 2023 report from the Federation of Indian Fantasy Sports (FIFS), the industry’s self-regulatory body, and the audit and consultancy firm Deloitte India, the fantasy sports market in India now has a current enterprise valuation of ₹75,000 crore. There are over 300 platforms for fantasy sports across the country (the better-known ones include Dream11, Fantasy Akhada, A23 and Guru11) and an estimated 180 million users. Taxes worth ₹4,500 crore have been generated by the industry between FY18 and FY22, a number expected to reach ₹26,000 crore over the next five financial years, according to the report.
A 2019 industry report from IFSG (the former avatar of FIFS) noted that while the gaming industry’s first 10 million users were from the metros, tier 2 city users formed over 50% of the customer base—this is the case today too. These are places like Lucknow, Jaipur, Bhopal, Kota and Dehradun.
Dream11 holds 90% of the market share, with its competitors being firms like Fantasy Akhada, A23 and Guru11. Clearly, fantasy sports firms have unlocked a humongous market in India and set the stage for aggressive expansion.
In India, real-money fantasy sports are legal in most states and Union territories (like Delhi, Madhya Pradesh, Rajasthan). They were briefly outlawed but later allowed in some states (Karnataka and Tamil Nadu). States like Sikkim and Nagaland, which have legalised casinos, sought to bring fantasy sports under their own regulations but the companies declined and they currently do not offer real-money fantasy games in these areas.
Today, the influence of fantasy sports in the IPL broadcast itself is palpable. Before a game, there are dedicated segments offering tips for fantasy sports players. Ex-cricketers offer advice about which players are in form, which venues work well for what style of play and so on. In vogue currently is the idea of “matchups”, i.e. which batters are vulnerable against which bowlers, or what lengths are ideal for bowling on different kinds of pitches.
According to former Team India opener and broadcaster Aakash Chopra, whose Hindi commentary seems to be especially popular these days, fantasy sports have made a significant difference to the pre-match programming in particular. “Earlier, only hard-core fans would tune in 30-40 minutes before the game,” Chopra says. “They would faithfully watch the toss, the pre-match interviews and so on. But now there is an entire section of viewers who are playing fantasy sports and who probably think 30-40 minutes are not enough to get the information they need. There are so many permutations and combinations of players that can work for every game and you need every bit of information you can get to make your choice.” Substitutions are allowed till the first ball; 3.30pm or 7.30pm, as the case may be. In the case of delayed starts, the clock ticks till the first ball.
Chopra gives the example of the game between Mumbai Indians and Gujarat Titans at Mumbai’s Wankhede stadium on 12 May, where the former beat the latter (a much higher-ranked team) comfortably. “Wankhede is one of the flattest grounds in the country, great for batters” Chopra says. “But for some reason—nobody knows what—Shubman Gill doesn’t have a good record at this ground, I think he averages about 8 there. So, if you were playing fantasy cricket, you would not want to risk making Gill your vice-captain or captain,” says Chopra (captain’s points are automatically doubled, while the vice-captain’s points are multiplied by 1.5). As it turned out, Gill was bowled for a paltry 6 off nine balls.
Fantasy players like myself, seduced by Gill’s surreal run of form over the last six-eight months, suffered on 12 May. We ought to have listened to Chopra and co. during the pre-match fantasy segment.
If you watch even 30 minutes of an IPL game today, you will see seven-eight different advertisements that will drive home the significance of the fantasy sports industry. To begin with, Dream11 is one of the official partners of the IPL (in 2020, it was also the title sponsor, after paying upwards of ₹200 crore for the deal). Its current series of advertisements sees actors Aamir Khan, R. Madhavan and Sharman Joshi (stars of the 2009 superhit film 3 Idiots) alongside cricketers like current Team India captain Rohit Sharma, Hardik Pandya and Bumrah.
In the past, taking former players for fantasy sports advertisements has led to concerns about conflict of interest, both in India and elsewhere. In 2020, Sourav Ganguly, then president of the Board of Control for Cricket in India (BCCI), endorsed My11Circle, a rival of the IPL sponsors Dream11. Dream11 claimed it did not have a problem because it was a “personal endorsement”, not one as BCCI president. Ultimately, the issue was dropped. Former sportspersons continue to appear in advertisements. This is par for the course when it comes to fantasy sports globally too—ahead of the company’s mobile app release in Massachusetts, US, DraftKings recently shot an ad with former Boston Red Sox mainstay David Ortiz.
On the JioCinema app (the current streaming partners of the IPL), you can play Jio Dhan Dhana Dhan—answering one question about the day’s game (for example, “Over No.15 will go for how many runs?”, followed by four options) to potentially win a car or other prizes. There are secondary services and products like the MPL (Mobile Premier League) Opinio, which uses a similar format, with yes-or-no questions about the match of the day, in exchange for a shot at monetary prizes (Opinio, incidentally, is endorsed by former cricketers-turned-commentators like Chopra and Danny Morrison).
These entities, and the IPL season-long fantasy game that I and 2.5 million others play, can be considered “gateway drugs” for the real money-spinners, Dream11’s paid contests, which have an entry fee for participation and offer a chance to win the pool’s top prize.
The most popular contests are the ones with low entry fees (anywhere from ₹5-100) and high prize pool (prizes totalling ₹10-20 crore or more). Naturally, these contests also typically have 20-30 million players or more, according to data from the Dream11 app. Apart from these low-entry-fee contests, however, there are also smaller contests, often private. Entry fees for these are typically five figures or more, with a handful of players, and the prize money, accordingly, runs into a few lakhs. Potentially, if one keeps choosing high-entry-fee contests and losing, one could end up losing a lot of money across the 70-odd days of the IPL.
I mention the “gateway drug” bit for good reason—one of the advertisements currently playing in the IPL is for an app called Kissht (the Hindi word for “instalment”), which offers quick, small-amount lines of credit. Clearly, the ads are meant to push you towards the paid contests.
Dream11’s business model is simple: It takes a commission of about 15-20% of the total prize money for every league or “contest”, as they call it. The fact that the users put up the money themselves—the platform only takes its cut from the prize money, not the actual pool itself—is crucial.
Daily games means that there’s a daily reward mechanism that keeps bringing users back for more. Thejaswi Udupa, vice-president at Foundit.com (formerly Monster), has over five years of experience in sports product management and reckons that the daily gratification factor is the game-changer for firms like Dream11. “What has happened in India is pretty much a reflection of what happened in America five-six years ago with firms like DraftKings,” he says.
“See, the traditional fantasy sports have been around for a long time, whether it’s the ‘draft model’ or the ‘salary cap model’. But it’s only the very invested players who will spend half an hour or an hour every day on their team. Even Dream11 started off with the very traditional salary cap model. But they realised that if they wanted more and more people to use their product, they have to provide a game in which there’s some instant gratification,” says Udupa.
Back in 2010-11, Udupa was the product manager at Yahoo! Cricket and one of the things they tried to do was create a fantasy sports product for cricket. “We had tied up with Dream11 and they would white-label the solution for us. We wanted to develop a game that would be far more engaging than the usual, you know, daily team setting and changing of players, which is what you do in salary-cap-based fantasy sports,” Udupa explains.
The game Udupa and Yahoo! Cricket came up with was Predictopus—the pun alluding to Paul the Octopus predicting games in the 2010 football World Cup. The idea was to offer odds throughout the game on who would win. The twist? You could trade on these predictions, just like trading on the stock market. The odds would keep changing after every event (a six, a wicket) based on “market sentiments”. It was a points-based system where at the end of the day the leader board would be dictated by the trades you would make “on these local points of maxima and minima”, as Udupa puts it.
Yahoo! Cricket hit a snag because fantasy cricket was a novel concept at the time and they had to sit with lawyers and draft arguments that said this was not a game of chance but a game of skill.
The late 2000s was when the fantasy sports industry took its first big steps in India (Dream11, for example, was formed in 2008) but there was a very important precursor.
When I was a teenage cricket fan watching every ball Sachin Tendulkar and co. played, the high point of the men’s cricket team was a 12-month phase in 2002-03 when they won the 2002 ICC Champions Trophy in Sri Lanka and finished runners-up at the 2003 World Cup in South Africa. But these tournaments weren’t the only thing cricket fans were keeping an eye on. Super Selector, ESPN Star Sports’ fantasy game, was all the rage at the time.
Sharmistha Gooptu, writing in the 2005 Routledge book Sport In South Asian Society: Past And Present (edited by Boria Majumdar and J.A. Mangan), described the influence of Super Selector during the 2002 Champions Trophy and the 2003 World Cup.
“During both tournaments, Super Selector, a fantasy cricket game show was being shown on ESPN and Star Sports channels in the prime-time slots of 7.30pm and 10pm. Super Selector became prominent during 2001, and was played by some 500,000 people during the 2003 Cricket World Cup in South Africa. (…) The phenomenal popularity of Super Selector in India saw the launching of clones on the BBC and Sky Television in Britain, and www.cricinfo.com, cricket’s leading website. During the 2003 World Cup, the Super Selector website remained inaccessible for long periods because it was overloaded, too many people having entered at the same time,” Gooptu writes.
In September 2002, an interactive element was added to the show for the Champions Trophy. Participants in Super Selector would be contacted (live and at random) over the phone and asked a question on cricket trivia. The prizes on offer included cars and motorbikes. The person getting the maximum number of Super Selector points would be invited into the ESPN Star Sports’ commentary box.
If you follow Dream11 and what it’s doing right now with the IPL broadcast and on its app, there are clear parallels with the Super Selector era. Joy Bhattacharjya, who produced Super Selector for television, has been the director general of Fifs since July 2022.
Although cricket remains by far the most popular sport in India, gaming companies are actively expanding in other markets as well. For example, Dream11 has an official partnership with the Pro Kabaddi League.
Recognising that this is a nascent market, Dream11 also offers free-of-cost “trial games” so that users can get a hang of team-building in kabaddi. The platform also offers users fantasy games pertaining to sports like football, hockey and basketball. According to a September 2020 report in Scroll.in, India had over 220,000 users of the Fantasy Premier League—that’s the official fantasy game of the English Premier League.
The biggest challenges faced by the fantasy sports industry have been legal. Over the last decade, states like Karnataka and Tamil Nadu banned fantasy gaming at various points, only to have those bans challenged and often overturned. The basic question argued by courts, including the Supreme Court, pertains to whether online games are games of skill or games of chance.
According to technology and gaming lawyer and independent scholar Jay Sayta, this has historically been the most important issue before the courts. “Various states have, at various points of time, argued over whether online games like fantasy sports fall into the category of ‘games of mere skill’,” says Sayta. “Which is a phrase derived from the 1867 Public Gambling Act. Since then, the Supreme Court has ruled in the context of things like horse-racing, rummy etc. that these games involve a clear dominance of skill over chance and therefore they cannot be treated at par with gambling, betting or the lottery etc.”
To get the gaming companies’ perspective on legal issues, I speak to lawyer Sahil Arora, partner at Saraf and Partners, who has extensive experience in fintech and regulatory issues.“Insofar as what would amount to gambling, the jurisprudence has been settled for decades now,” says Arora. “And to that end, a distinction is made between a ‘game of skill’ and a ‘game of chance’. Right from the time of K.R. Lakshmanan v. State of Tamil Nadu (1996), the Hon’ble Supreme Court settled the issue that in order to constitute gambling, three elements are required. One, the user is putting in money to be able to play the ‘game’ (that is to say, there is an element of consideration); second, the user is getting a reward at the end; and most importantly, No.3 is that the ‘game’ in question is one of ‘chance’. Only once all of these three elements are satisfied is a particular activity considered ‘gambling’.” Basically, once a game is regarded as a “game of skill”, it is considered a legitimate business practice, not gambling.
Arora points out that in the 1967 case of State of Andhra Pradesh v. K. Satyanarayana & others, rummy was deemed to be a game of skill based on these factors. He adds that in south Indian states, revenue from games like rummy is immense because of the cultural affinity to rummy there.
These issues tend to be extremely geo-specific. For example, poker is socially accepted as a predominantly skill-over-chance game in the US, so it’s legally recognised that way. Today, lobbying efforts are under way to get poker legally recognised as a game of skill in India as well.
“The UK has a clear licensing policy when it comes to gambling,” Arora says. “That’s their way of ensuring that anything coming under the ambit of ‘gambling’ is legitimised, it’s regulated, there are licensing frameworks, you can make sure there’s no addiction, there are well-defined limits to the amount of money you can invest within a time frame and so on.”
Countries like Australia have both national- and state-level laws on gambling. Things are so specific that horse-racing has a law all to itself, as does bingo. When it comes to something as new and as rapidly-evolving as fantasy sports, perhaps it’s advisable to have this level of granular detail in any legislative framework that seeks to regulate this sector.
As Arora points out, certain states, like Andhra Pradesh, Tamil Nadu, Karnataka and Telangana, can be termed “restricted”. Earlier, their laws prohibited gambling, with an exception in place for games of skill. But when news reports started pouring in about vast sums of money lost, addiction and even suicides due to huge losses, governments began to explicitly outlaw online gaming. In 2020, the Andhra Pradesh government banned Dream11 and other fantasy gaming platforms. In 2021, Karnataka and Tamil Nadu followed suit. At the same time, these states were generating huge revenue from online gaming, which meant that the stakes were very high for the gaming companies as well.
The gaming companies challenged the governments of Karnataka and Tamil Nadu in the respective high courts and won, arguing that the state laws were against Article 19 (1) (g) of the Constitution, which pertains to the right to practise one’s trade or commerce. In Article 19 (1) (g), the only exceptions placed dealt with gambling and the companies argued that their games had already been recognised as games of skill, i.e. different from gambling. Legal battles continue in Telangana and Andhra Pradesh (online games are not offered in their money-making versions in these states).
Some states, like Sikkim and Nagaland (both of which have legalised casinos), sought to bring fantasy sports within their own, relatively permissive legal frameworks. Others, like Assam, Odisha and Arunachal Pradesh, are in a legal grey area—fantasy sports are neither explicitly permitted nor explicitly outlawed (there is no “game of skill” exception in the gambling law). Both these categories of states have been given a pass by the gaming companies for now. Perhaps the relatively low number of participants from these low-population states does not justify the operational costs of bringing the business under the ambit of state-specific regulations.
There have been taxation issues as well, with the GST (goods and services tax) council slapping evasion notices on fantasy sports firms at the end of 2022. The bone of contention between the GST council and the gaming companies is simple—should the total entry money in online contests (GGV, or gross gaming value) be taxed? Or just the net revenue, the 15-20% commission charged on the prize money alone (GGR, or gross gaming revenue)? The gaming companies favour the latter, since the money supplied by players for the pool is parked in an escrow account and the companies do not touch it. Once the contest is concluded, the prize money—minus the commission—is credited to the winner and it is this money alone that’s considered an “actionable claim” in legalese. “Actionable claim” refers to a debt that a company legally owes customers—a sum of money not yet transferred, services promised but not rendered, etc.
The companies argue that until the game is over, there’s no actionable claim in any case, so there should be no taxation on the entry money.
If one were to tax the entire pool, the taxation would obviously increase 5-10 times, perhaps more, since the revenue, or GGR, is clearly orders of magnitude smaller than the pool money (GGV). For example, the most popular paid contests on Dream11 see millions of users putting in ₹5 or ₹10 each, in exchange for the chance to win ₹1-2 crore for themselves.
Earlier this month, the gaming industry savoured a decisive victory in this context. The Karnataka high court quashed a government notice sent to Gameskraft Technologies seeking ₹21,000 crore in unpaid GST; the Bengaluru-based firm owns online gaming brands like Gamezy and RummyCulture.
The final decision on the GST policy governing fantasy games is likely to be taken in June, according to newspaper reports, but the gaming companies are confident that the currently prevalent 18% tax on GGR will be codified in law—as opposed to the 28% on GGV proposal floated last year by the Union finance ministry. “It’s not just the fact of taxing the gaming companies on the pool and not on the revenue,” Arora says. “In America, they do impose taxes on the entire pool but there the GST amount is 0.25% or 0.5%, that’s a huge difference from the 28% being sought here. The latter is the kind of taxation that could effectively kill a business model because ultimately taxation costs are passed on to the customer. And once the consumer doesn’t find the risk/reward equation favourable, they will move on to unregulated, illegal games.”
The social aspect of fantasy sports—personal leagues, fan communities and so on—is the next big thing companies are looking to tap into.
Like a particular player? You get to craft an entire contest centred around that player’s performances. Want to create a personal league with rules and points systems different from the default ones? There are services (like Cricbattle) that will let you do exactly that.
This is a new area of focus—leveraging the personal connection fans have with their favourite players and bringing more current and former players to generate exclusive, platform-only content for users. A recent example is the Dream11-backed Rario app, which offers officially licensed “digital playing cards” for star players. Rario, a cricket NFT (non-fungible tokens) marketplace, had signed NFT and Web-3 related partnerships with certain players.
Last month, however, it ran into two legal roadblocks. One, a rival company, Striker, used public domain data on these cricketers to make “digital playing cards” of their own. Rario tried to shut them down but the Delhi high court dismissed Rario’s claim, saying no company has exclusive rights to the identities and achievements of a public personality. Two, a group of five players, including Mohammed Shami and Harshal Patel, have approached the Delhi high court to stop what they claim is the unauthorised use of their names and pictures on NFTs.
It was only during the pandemic that the gaming companies witnessed a jump in numbers and realised that the social aspect could not be ignored any more. When I speak to MK, a new convert to the church of fantasy sports, he mentions that the lockdown prompted his friends and him to start playing Dream11.
“It started as time-pass, obviously during the (covid-induced) lockdown we all had much more free time than before,” MK says. “A bunch of us formed our own league. Before you know it, these folks had also invited their friends and it took on a life of its own. I think the format (of fantasy cricket) works because beyond a point, IPL games start to resemble each other. Competing with your friends and proving your ‘cricket guru’ credentials is how you keep things interesting.”
MK claims he has never gambled for money and doesn’t intend to. “Is it gambling? If you are investing substantial amounts, say more than a thousand bucks in it, then yes, I would say it is similar to gambling,” MK says. “But it is ‘informed gambling’. There is a certain minimum amount of knowledge you need to have to even consider playing these sports, right? There are so many variables in cricket especially. Every ground is different, the weather can make a big difference to the game.”
It’s fair to say that the average cricket fan in India is motivated more by emotions and fandom than cold, hard statistics and numbers. Will we see a cultural shift with the growing prominence of fantasy sports and all the secondary services associated with them? According to cricket analyst Alagappan Vijayakumar of Covers Off (which offers daily tips via subscription for fantasy sports players), this is a distinct possibility. “I think to an extent it’s already taking place,” Vijayakumar says. “When people see that analysts are using data to achieve better results, they automatically want more advice from that person or that service. And they will start paying close attention to the numbers.”
But for that to happen , people must see results and a process that can be repeated. “It is only possible if fantasy cricket analysts use data correctly, which is currently not the case in the mainstream,” Vijayakumar says, “And it is something we are attempting to improve. If an ordinary fan attempts to use the data the same way as most of these fantasy cricket analysts show, they won’t get the results because the fundamentals are off.”
With the growing popularity of “matchups” (statistics depicting how a batter fares against specific styles of bowling) et al, it’s not a stretch to see cricket analysts receiving the “rock-star” treatment typically reserved for stock market experts.
Others are not so optimistic, however, pointing out that such a cultural shift may be the opposite of what the gaming companies want. Udupa says: “The people who bet money on their favourite players, or make other choices based on emotion, they are the ones who are making the big money for the gaming companies. If too many people start approaching the games with an analytical frame of mind, the ‘house’ won’t win any more. It’s just like a casino that way.”
Even as I write these words, I am keenly aware that it’s about 40 minutes to toss time at today’s IPL game; I have to change my team. It’s Pavlovian, really, and I understand the addictive pleasure of online gaming much better now than I did in my 20s. It combines the all-or-nothing rush of a one-one-one sports contest with the reward/punishment mechanisms deeply ingrained within most of us.
This year has been my best-ever performance, actually (currently ranked 3,500 out of 2.5 million teams, with about 80% of the tournament over), and I am a little embarrassed at the inordinate, childlike joy this “achievement” has given me.
Aditya Mani Jha is a Delhi-based writer.