Online Gaming Industry Needs Regulation, Not Suppression: Digital technology has evolved rapidly in the past decade, making our lives easier, economies more efficient and societies less divided. It should take policy makers less time to understand and regulate new sectors of the online economy, gaming industry experts insist.
Gaming Tech – a Disruptor and an Economic Driver
In the aftermath of our post-pandemic reality, media outlets have started pointing out the importance of technology as a social equalizer. Online tools and platforms have allowed us to stay close at a distance, work together, shop and have fun directly from our mobiles. Technology has also allowed remote communities to get access to education, through online courses and material.
More importantly, digital technology has repeatedly challenged stagnant economic sectors, bringing innovation and more efficient solutions. When this happens – as is the case of India’s booming online gaming sector – policy makers often are the last ones to react with laws and incentives that can capitalize on an industry’s positive impacts.
Games of skill such as rummy, poker and other online jackpot games are formally recognized as legal by the Constitution and the Gambling Act. States like Delhi and Maharashtra have adopted a permissive stance, while others like Sikkim and Nagaland have explicitly regulated their practice through state licenses.
Online gaming for real money and for casual entertainment generates over $21 billion in global revenues. Out of more than 1 billion gamers, over 400 million are in India, making the Union one of the largest markets in the sector. What’s more, the desi domestic market is growing faster than those in China, Japan or the US. Large urban player communities in Delhi, Mumbai, Kolkata, Bengaluru, Chennai and Hyderabad drive the industry forward but non-metro areas also find an increasing amount of time for mobile games in their daily schedules.
Fragmented and Retrograde Legislation Holds the Industry Back
The desi gaming industry has not had the necessary support from the authorities. The few states that endorse and regulate the market are a minority and, on a national, scale, the approach is very fragmented and highly moralistic above all. Where there are no prohibitions, there is a void in local laws on the topic.
This has allowed a number of offshore and black-market operators to exploit the gray areas. Some bring quality foreign gaming platforms to the desi consumer but that is not always the case. Worst of all, without a domestic license, State and Central authorities have no ability to control, tax or guide their operations in the public interest.
The Chief Editor of one of India’s best casino comparing platforms, Felicia Wijkander, brings exhaustive evidence that blanket bans are ineffective, besides being plain unconstitutional. Legislators often fail to address the issue, investing their resources into generating loud political statements that nurture people’s fears but solve little to nothing.
States like Tamil Nadu, Andhra Pradesh, Karnataka and Kerala have already been turned down by regional High Courts in their efforts to outlaw all paid online games. A careful, detailed and meaningful attempt to regulate the industry might be a challenge but it has been proven as the way forward. The leading European gambling and online gaming jurisdictions – the UK, Sweden, Germany, Italy, Spain, Denmark and many others – have already had measurable success through licensing regimes and strict but fair requirements on those willing to operate locally
Popular regulation measures include self-exclusion programs, deposit and spending limits, game speed settings, age restrictions and last but not least, actual tracking and taxation of profits made online.
Industry analysts concur that it is high India made concrete steps to adopt a modern and consistent regulation on online gaming, preferably on a Central level. The skill gambling industry can and should evolve and bring benefits to the local economy, without generating high social costs. This is the only way to protect desi youth, reap in the tax revenues and enhance the tech industry’s prospects.
