All to play for
By Joshua Chaffin
Published: November 19 2007 18:34 | Last updated: November 19 2007 18:34
As vice-president of games at ESPN, Raphael Poplock not only manages the company’s fantasy sports websites, he is also a fantasy player – and a committed one.
During quiet moments on his wedding day three years ago, Mr Poplock found himself sneaking out and logging on to the internet to trade players for his fantasy football team. His honeymoon, it seems, was less a romantic getaway than an exercise in fantasy sports withdrawal. “We went to Greece, and I had an itch the whole time,” Mr Poplock confesses.
The object of his obsession is a game in which ordinary fans have the opportunity to indulge their desire to play manager. Each week, they choose a roster of real world players for their ideal, fantasy team – be it in football, baseball or basketball – and then compete against other fantasy teams based on the real-world statistical performance of those players.
With the help of the internet, fantasy sports has grown from a niche hobby to a widespread phenomenon in recent years, and its growing audience and addictive qualities have drawn the attention of big media and internet companies.
Along with ESPN, the sports division owned by Disney, Yahoo, CBS, Fox, NBC and the major US sports leagues are competing for business from the millions of men in their 20s and 30s who may have turned away from primetime television but happily spend hours each week on fantasy websites, organising their teams and gorging on sports content.
“Fantasy is a big business,” says Quincy Smith, president of CBS Interactive, whose CBS Sportsline operates one of the most popular fantasy football leagues.
The Fantasy Sports Trade Association has estimated the industry’s value at $1bn (€683m, £490m), with roughly 20m players in the US and Canada. One research firm, Challenger, Gray & Christmas, claims that fantasy sports cost US companies as much as $435m a week in lost productivity.
A better measure of fantasy’s value, though, may be its ability to glue sports fans to particular websites for extended periods of time.
This September, for example, as the American football season kicked off, CBSSports.com at-tracted more than 100m visits – an all-time high. Each visitor spent an average of 96 minutes on the site for the month, which was nearly triple the industry average, and something that the company attributes almost entirely to fantasy. “What fantasy does is promote more time spent on the site,” Mr Smith says.
Mr Poplock has witnessed a similar phenomenon at ESPN, where fantasy customers devour more of the company’s content – from its televised sports coverage to its radio broadcasts, magazine articles, mobile phone updates and online features – than other consumers. “Our fantasy fans are the best community of fans we have,” he says.
People played fantasy sports, or a variety of them, long before the internet era. In 1980, Dan Okrent, a sportswriter and editor, created a fantasy baseball league with a group of friends in New York. They called it “Rotisserie Baseball”, naming it after the French restaurant where they gathered.
Rotisserie gained popularity after newspapers such as USA Today began to publish expanded sports statistics and sponsored fantasy leagues. But it truly took off – not unlike day-trading – in the late 1990s, when the internet did away with the paper trail and made it possible to crunch and sort enormous amounts of data in real time. “It just exploded,” says Jeffrey Thomas, president of the Fantasy Sports Trade Association.
The web also allowed players to talk to one another through e-mail and message boards, creating an early example of an internet community. It led Bill Simmons, the ESPN sports columnist, to declare recently: “The internet had a greater impact on fantasy sports than on porn over the past 11 years.”
As it turns out, fantasy may have common ground with another vice: gambling. Many fantasy players wager among themselves, creating pots that run into the tens of thousands of dollars, and several internet companies have sprung up to promote fantasy league gambling.
For big media companies, though, money is made by selling advertising to companies attracted by high traffic. The multi-platform Holy Grail for ESPN, CBS and other media giants is the fan who watches a broadcast of a game on TV while also tracking sports news and fantasy statistics on a laptop opened to their web page, and messaging friends and competitors via their mobile phone or instant-messaging services.
In pursuing these core fans, US media and internet companies have expanded fantasy from its baseball roots to just about any sport that includes data and a passionate fan base, including basketball, hockey and Nascar. They even tried fantasy bass fishing – although that proved short-lived.
They are also pushing into Europe, where the UK has a tradition of fantasy football leagues. The two largest Premiership fantasy leagues – Premiereleague.com and Fantasyleague.com – attracted nearly 2.3m unique users in August, according to ComScore, the internet research company.
“The proportion of time being spent on these sites during office hours is significant,” says Bob Ivins, executive vice-president at ComScore. “On the Friday before the start of the Premiership season alone, over 230,000 office hours were spent on the fantasy football sites.”
Meanwhile, Myfootballclub.co.uk, a website with 20,000 paying subscribers, last week bought Ebbsfleet, a lower division English team. In a fantasy-inspired move, subscribers will vote on transfers, team selection and other matters.
The fantasy king, though, remains American football, which is ideal for the medium because it is laden with player statistics. The biggest operator is Yahoo Sports, with more than 4.3m customers. The internet company built a large audience by offering its product free, although it now charges $124.99 for a premium version. Yahoo also sells sponsorships to companies and brands such as Toyota, Heineken and Viagra.
“It’s a very profitable business for us,” says James Pitaro, vice-president of Yahoo Sports. “These are fans who consume an incredible number of pages on our site. They also consume a lot of video.”
ESPN has been trying to catch up. After dropping the subscription fee for its fantasy football game three years ago, it saw a 10-fold increase in traffic, and has added numerous bells and whistles to draw more users. It hopes to steal a march on competitors by using its cable television network, radio station and other assets to promote its fantasy products. Each Sunday morning, for example, the network airs a one-hour fantasy pre-game show on ESPN News.
A pack of smaller competitors is likely to enter the fray after a US court ruled last month that sports leagues could no longer charge tens of millions of dollars in licensing fees for data about their players – removing a barrier to entry.
But for some media executives, fantasy’s future lies beyond football – or any other sport. At CBS, Mr Smith wants to take the medium and all its interactive possibilities and apply it to a range of subjects that inspire a passionate following. One idea he is considering is a weekly Hollywood-themed contest in which participants would draft celebrities and score points based on how they perform at the box office, whether they become pregnant, enter rehab, or are arrested for driving under the influence. The BBC’s website has run a similar game, Celebdaq, for years.
“What we’ve been asking internally for several months,” Mr Smith says, “is, what is the fantasy for other categories?”
Copyright The Financial Times Limited 2007
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