What Is Going To Happen To High-Stakes Fantasy Football?

Greg Ambrosius · Post by **Greg Ambrosius** » Mon Apr 25, 2011 10:42 am

Well, the live events model in the fantasy football industry has certainly taken a turn this off-season and now we're heading into a make-or-break season for a lot of people. I mean it's make-or-break for consumers and game operators alike.

I don't have a High-Stakes Forum on the NFFC boards for obvious reasons. But we're not afraid to talk about the competition here and provide insight for others. Heck, it's not like we have our heads in the sand. We know what's going on with our competitors as much as you folks and we know that many of you will play in at least two different contests this year and maybe three. So let's talk about it intelligently here and give information to those who need it.

Obviously the WCOFF situation is of serious concern and I feel bad for everyone who hasn't been paid yet. I don't have any insight there and I've heard from some who are closer to Dustin than I am that he is working on new investors and still plans on going forward in 2011. I certainly hope that happens because the sooner past winners get paid the sooner they can start planning for the 2011 season. Whether they return to the WCOFF or other events is all up for discussion, but it's more likely that they don't play at all if they don't get their winnings from 2010, so here's hoping something positive happens there very soon.

We obviously feel there is an opening now on the first weekend of the NFL season and will be hosting live Main Events in Las Vegas that weekend for the first time. We increased our grand prize in the NFFC Primetime to $100,000 and will push the 12-team contest with multiple live events on Sept. 9th and 10th in Las Vegas. We obviously wouldn't be doing that without the latest news on the WCOFF, but our customers have told us that they want another experience like they had at the Bellagio in March and they want an expanded 12-team Main Event. We'll gladly give it to them and stay an extra weekend in Sin City!!

The FFPC also is trying to fill this potential void by announcing today a $200,000 grand prize and increased league prizes. They hope to capture some of the customers who go out to Las Vegas for that great first weekend of NFL action and believe they can do that with a bigger grand prize. Second place overall looks to remain at $12,500, but apparently one big carrot and bigger league prizes will get the job done. I commend Alex and Dave for stepping up to the plate on this one, but we'll see if WCOFF really is going to be done or lose ALL of those 800+ teams they had last year.

One thing is for certain: It's not going to be possible for all three contests -- actually four if you consider that we have two Main Events at $100,000 each -- to reach their goals with a diminished football off-season. I mean, how can WCOFF reach 1,200 teams, FFPC reach 660 teams and NFFC reach 650+ teams all at $1,400+? It's just not going to happen in today's marketplace. Something is going to have to give. And consumers will make that choice for all of us.

This isn't a thread to pick apart one contest over another. It's just an area to intelligently talk about the good and the not so great. Heck, I hope we all survive and the fantasy football space will DOMINATE Las Vegas for two weekends. We obviously love Labor Day weekend in the multi cities and I think our plan of two $100,000 grand prizes over two weekends is the safest of them all. But maybe we're overshooting. Let me know what you think of the various contests and feel free to make some predictions on the future of this space.

Hopefully all of us have planned this out properly and we've done our homework on our customers. It's a tough space with tough margins and large expenses, but it can be a profitable space if the game operators are honest, have sound software, have sound business plans and have good financial backing. I hope we all have that.

Provide your thoughts. I'm as curious to your thoughts as anyone. Thanks all.

King of Queens · Post by **King of Queens** » Mon Apr 25, 2011 1:53 pm

Greg, it seems like all of the contests -- NFFC included -- are relying on customers to take multiple teams in order to hit their numbers. While that may be fine for now, I believe this will eventually become a problem.

Do you foresee a lot of "new blood" entering the high stakes arena this year? In the past, you had FSM and Fanball to promote your contests. What will be the promotional vehicle that attracts new customers to the NFFC?

weber7777 · Post by **weber7777** » Mon Apr 25, 2011 2:30 pm

- i believe if any of these main event big leagues, put out main events for a clean grand per entry.. i think they would prosper and make up the ground w/ the numbers...

Diesel · Post by **Diesel** » Mon Apr 25, 2011 3:32 pm

If indeed all contests are now relying on multiple entries from their customers in their Main Events, then this industry is in big trouble.

I think for most people, "HIGH STAKES" is in the $350-$750 range. $1300-$1600 is just out of people's realm of what can be "gambled" with.

My opinion is with all business, adapting is imperative. It may be possible that the LIVE events just aren't ever going to give ANY contest the kind of profit they would hope for. With that, business must adapt and possibly change their gears towards what really is the realistic, long term goal.

I could be wrong, but I'm wondering if the word of High Stakes fantasy has already reached every player that will shell out thousands of dollars every year. If this is true, then it's up to each contest to 1-Ask if they can continue without much growth, and 2-keep every customer every year or lose profits.

It seems as if the FFPC caught a lot of steam with footballguys clientele last year. This gave them many more entries into their online contest than they had anticipated. Now they are going ALL-IN, and they are going to try and see if all of those footballguys entrants are willing to pay a higher entry fee for their main event. Guaranteeing a $200,000 grand prize is an all or nothing move in my opinion. It's not my business, so it's hard to say whether it's smart or just crazy until we see how it goes this year, if the NFL plays out.

The NFFC has their solid, faithful, clientele. The Quality over Quantity motto has won over many people. There was a major hiccup last year with Fanball's demise. But the NFFC is OWNED by Greg and Tom now. For anyone that knows Greg and Tom, they know what they bring to the table. Their conservative, solid and honest business decisions for close to a decade now leave them with a reputation that is almost impossible to challenge.

I can't speak of WCOFF other than I played one contest, won $5,000, and never wanted to play again. There was something I didn't like about it, and my choice was not to play there anymore. That was that.

The future of this industry rests in the hands of the contest that understands that this isn't a business that will make you rich. But will carry on anyway.

Just my 2 cents.

Coltsfan · Post by **Coltsfan** » Mon Apr 25, 2011 3:52 pm

The problem that I see with high stakes fantasy football is that for most, it's a losing proposition. We see people come in and play 2-3 years, fail to win a league, and then move on. There isn't enough money in the leagues for the decent players to make enough money to keep them interested. I completely understand that the grand prize brings people in but the lack of league money causes people to leave.

I do the main events because they are just so much fun and I've been fortunate enough to be a bit better than even over the year but I make a lot more money in satellite leagues. But if somebody comes in and plays 3 straight years without finishing in the money, how likely are they to play year 4? If money is no object then probably but if it does factor in then who knows.

I can't even begin to imagine WCOFF recovering from the hole that hey have dug - even if the do find the money to pay people this year.

I see the FFPC and NFFC both picking up some of the WCOFF people this coming year. Both contests should grow from this. It will be interesting to see how these two contests promote themselves to the players looking for a new place to play. I think both contests have made very good moves the past couple of weeks to appeal to what will be the former WCOFF players. My hope is that at least 300 of those players choose a new contest verses deciding just not to play anymore. I'm sure some will be upset and go that route but hopefully not too many.

Anyways, the only obstacle still standing in our way is the greedy players and greedy owners. Hopefully this gets resolved soon so that the fantasy industry isn't harmed by losing all or part of a season.

Wayne

pizzatyme · Post by **pizzatyme** » Mon Apr 25, 2011 3:54 pm

I agree and disagree with Marc here.

I do believe the mainstream has a payment threshold of $1000. Something in the $600-1000 range is missing (to my knowledge) in the industry on a large scale.

I think this is the sweet spot and offers the most staying power.

People would be nuts to stay with WCFF based on current and past events.

I don't think the FFPC or NFFC are making any kind of all-or-nothing moves. It is OBVIOUS that there is an opportunity there.

I think the Fanball fiasco was more than a hiccup. I enjoy the NFFC and plan to go to Chicago this year for an event or two, so I'm not bashing in any way, just being honest.

I agree with Glenn that everyone can't survive based on multiple EFs. That just points to a thin base.

Good luck to the 2 Events who I'll be spending money with this year!

BONGIZMO · Post by **BONGIZMO** » Mon Apr 25, 2011 4:46 pm

My take as one still not paid by WCOFF is that the NFFC and FFPC are making wise moves to capitilize on the WCOFF's own missteps. This isn't a matter of either trying to grow to fast as both tend to think things through but each contest is wise to sense an opening and try to grow from it.

Both will see extra teams as folks like myself that play all three events will have extra capital to distribute among the contests that have had a history of paying us in the past. I think there are far more of these extra funds coming forth than either contest may be expecting...

Diesel · Post by **Diesel** » Tue Apr 26, 2011 1:58 am

Originally posted by Just Russ:

I do believe the mainstream has a payment threshold of $1000. Something in the $600-1000 range is missing (to my knowledge) in the industry on a large scale.

-I agree. These are more likely the target "High Stakes" numbers.

People would be nuts to stay with WCFF based on current and past events.

-Agreed. If this isn't a "flashing light" warning sign, I don't know what would be.

I don't think the FFPC or NFFC are making any kind of all-or-nothing moves. It is OBVIOUS that there is an opportunity there.

-I play in BOTH contests, so please don't anybody think I'm bashing anyone here. But I think you have to re-read the last few paragraphs of the FFPC's announcement.

[ April 26, 2011, 08:01 AM: Message edited by: Diesel ]

Greg Ambrosius · Post by **Greg Ambrosius** » Tue Apr 26, 2011 2:36 am

Originally posted by King of Queens:
Greg, it seems like all of the contests -- NFFC included -- are relying on customers to take multiple teams in order to hit their numbers. While that may be fine for now, I believe this will eventually become a problem.

Do you foresee a lot of "new blood" entering the high stakes arena this year? In the past, you had FSM and Fanball to promote your contests. What will be the promotional vehicle that attracts new customers to the NFFC? I agree with your first point Glenn, but I can only speak for our event. Since we are shooting for "only" 300 teams in the Primetime and 322 in the Classic, we're not necessarily RELYING on owners to take multiple teams. Those are reachable goals for us even if every owner only takes one team, but we definitely are offering multiple draft dates and times now because honestly that's the way the market has gone. As you know, I've resisted that for years, but last year when I saw some contests offering FIVE draft times, I had no choice but to move away from the simultaneous Main Event drafts. Now if our owners want multiple teams we will offer them. But I agree, relying on your core audience to take more teams is not the best business plan.

For all of us, we need to GROW the marketplace and in many ways we have. I think when we introduced the $350 price point for an online championship, it was the right level. We brought in a lot of new NFFC customers through our association with RotoWorld in 2008 and again through Fanball last year, and there's no doubt that the FFPC did the same thing last year through their partnership with FootballGuys.com. Both contests brought in die-hard fantasy football fans for the first time and now we'll see if some of those owners move into the live events with both of us.

We will NOT have a magazine to promote the NFFC this year, which is a first for us. I'm disappointed about that, but the lockout makes it tough to put out a magazine. Plus Fantasy Sports Magazine is still with Fanball. So we'll need to be creative in our markets to reach new customers and STATS has some good ideas in that area. We don't have anything in place yet, but there's no doubt that we're thinking outside the box and willing to do some things with promotional vehicles that we've never done before. Stay tuned because it could be GREAT.

But I totally agree with you. We need to grow this customer base and not just try to take customers from other games. We also need to be more fiscally sound and not "give away" entries to make things look better than they are. The margins are small, the expenses can be high and if you don't own the software the risks are even greater. So everyone must be sound financially or we will all kill what is a very good part of this great industry.

Greg Ambrosius · Post by **Greg Ambrosius** » Tue Apr 26, 2011 2:46 am

Originally posted by BONGIZMO:
My take as one still not paid by WCOFF is that the NFFC and FFPC are making wise moves to capitilize on the WCOFF's own missteps. This isn't a matter of either trying to grow to fast as both tend to think things through but each contest is wise to sense an opening and try to grow from it.

Both will see extra teams as folks like myself that play all three events will have extra capital to distribute among the contests that have had a history of paying us in the past. I think there are far more of these extra funds coming forth than either contest may be expecting... You make interesting points Scott and again I wish you best of luck in getting fully paid by the WCOFF. I hope that happens soon.

People who say this market isn't excelling is missing a very basic point: The number of teams competing in this space has gone up every single year since Lenny and Emil unveiled the WCOFF in 2002. They had 548 teams that year and sold out at 600 the next year and then we came along in 2004 and had 224 when they went up to 660. Last year there were more than 1,500 teams at $1,400 or more plus more than 3,000 teams at $350 or more among the three contests. So obviously there are more teams these days willing to play at this level than ever before.

Will the WCOFF be able to retain those customers or will those customers leave the space completely? Or will they go to the two other competitors who are banking on some of those people staying in the space and playing with them? That's what we'll need to see once things start rolling along.

I do believe that we'll see a total of 1,500+ "teams" in this space this year. But again, you have three contests basing their prize money on 2,500+ teams, so something has to give. Someone isn't going to meet their goals and maybe all three won't. But the winner will be the leader of a part of this industry that shows no sign of reducing in size.