In a move with far-reaching consequences, the government of India is planning to set up a watchdog/ regulatory body to regulate the untamed skill gaming industry in India – one of the four largest gaming markets in the world. This move is expected to bring legitimacy, and promote investments in the mushrooming online gaming industry, and safeguard the interests of players.
Skill gaming industry in India- an overview
Skill gaming refers to online fantasy sports like Dream 11 and MPL fantasy cricket, and card games like rummy or poker, which require the use of skill.
The online gaming market in India currently worth about US$1.5 billion — is expected to triple in size and reach US$5 billion by 2025. India with one of the world’s largest youth populations is expected to become one of the world’s leading market destinations in the gaming industry.
The key factors behind this growth include – a growing population of youth, higher disposable incomes, fast network connectivity, the introduction of new gaming genres, and a rapidly increasing number of smartphone and tablet users. Game developers are also continuously striving to enhance the gamer’s experience and launching new games for diverse console/platforms, such as PlayStation, Xbox, and Windows PC, which are provided to the gamers through these devices.
Cloud gaming is an emerging technology, which allows the user to stream high-end games across hand-held devices, such as laptops, tablets, and mobiles, thereby eliminating the requirement for a regular hardware upgrade or a gaming console/PC/laptop.
In the past 2-3 years, more than 200 game development companies have come up, creating their own intellectual properties (IPs) in games.
Currently, there are 920 gaming start-ups in India, with Mumbai which is the base where most of the top players in this segment operate from.
Impact of lockdown on the online gaming industry in India
The COVID-19 pandemic and lockdowns accelerated the growth and proliferation of online gaming in India. Time spent on games increased dramatically as virtual zones became avenues to socialize, connect, and compete.
According to the Broadcast Audience Research Council India (BARC) report, the average time spent by gaming users per week in India increased by 44% during the pandemic. The time increased to 3 Hours 38 minutes per week during the COVID-19 pandemic from 2 hours 31 minutes pre-pandemic.
Interestingly the lockdowns and restrictions during the pandemic changed the landscape of the online gaming industry in India. As per a survey cited by Invest India, nearly 45 percent of India’s mobile users started playing games on their smartphones during the pandemic.
The future:
According to the World Economic Forum (WEF), mobile is the primary vehicle for the gaming market in India.
According to the India Cellular & Electronics Association (ICEA) 2020 report, India’s total number of smartphone users is expected to rise to almost 830 million by 2022.
Already over 220 million gamers spend an average of 42 minutes per day on mobile games. NASSCOM data estimated that the Indian mobile gaming market to reach 628 million users by 2020.
Besides, high-speed 4G internet penetration sustained by the world’s lowest data tariffs have contributed to cementing this trend.
As per IBEF, there are around 275 game-related companies in India like Electronic Arts (EA) Sports, Mobile Premier League (MPL), Dream11, Nazara Technologies, Halaplay providing direct or indirect employment to around 3,000 to 4,000 people.
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However, the root cause of the problem is that there is no watchdog or uniform federal law to mitigate challenges like money laundering, gaming addiction, and fraud in the skill gaming industry in India.
Although the Public Gambling Act, 1867 and Prize Competitions Act, 1955 currently govern the online gaming industry at the federal level these laws have been rendered insignificant by various legislations in different states, which bypass and supersede these Acts. This is because state governments in India are empowered by the constitution to legislate on ‘betting and gambling’ activities in their respective state. Some States like Goa, Meghalaya, Nagaland and Sikkim allow gaming activities while Telangana, Andhra Pradesh, Kerala, Madhya Pradesh, and Karnataka prohibit games of skill.
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