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Are All Bets Off?

BY Imran Fazal

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In a major blow to illegal betting and gambling platforms in India, the Ministry of Information & Broadcasting banned advertisements of online betting platforms. Television channels, digital news publishers, and OTT platforms have been asked not to entertain such advertisements in a second such warning since June. The Ministry has noted that betting and gambling pose serious financial and socio-economic risks for consumers.

The order states, “It has now come to the notice of this Ministry that some online offshore betting platforms have started using news websites, as a surrogate product to advertise their betting platforms on TV channels.”

Investment on advertisements by betting platforms

According to experts, betting and gambling platforms invested around Rs 4000 crore a year.

Top actors endorsing betting platforms were Ranbir Kapoor (Fair Play News), Kiara Advani (Fair Play News), Nargis Fakhri (Betway), Sunny Leone (Jeet Win)

Top sports personalities endorsing betting platforms were Suresh Raina (1xBet), MC Mary Kom (Fair Play News), Saina Nehwal (Fair Play News), Harmanpreet Kaur (Raja Bets)

Betting platforms advertising in India

• Betway
• Bet365
• Fair Play
• 1xBet
• Parimatch
• Raja Bets

According to experts, the entire betting and gambling ecosystem based offshore, invests Rs 4000 crore upwards on advertisements and user acquisition. However, the Indian Gaming industry is rejoicing the first major step taken by the Indian government and is now mooting for a complete ban on betting apps and websites.

The MI&B advisory states that betting and gambling is prohibited in most parts of the country, and the promotion of offline or online betting/gambling through advertisements is not advised in the larger public interest. So, how are these platforms blatantly advertising through media channels? That too, on the back of well-known names from the fields of sports, and cinema. Sports and cinema are widely popular in India, watched by children, young adults, across demographics. To influence them through ads during a sporting event, with the lure of easy money is a troublesome trend indeed.

These betting and gambling platforms with Bollywood and Sports celebrities endorsing their brands, often masquerade as news or a Real Money Gaming (RMG) platform in India. It is interesting to note that the modus operandi of such illegal websites and apps is to project themselves as a skill based gaming platform like Rummy and Poker (SC judgement cites these games as skill based in nature), which directs a user to its parent website indulging in illegal betting and gambling.

E-Gaming Federation (EGF), a non-profit organization consisting of major RMG players like MPL, Games 24x7, PayTM First Games, Baazi Games, Octro, among others, hailed the Indian government’s decision. Sameer Barde, CEO of E-Gaming Federation said, “We applaud the government’s recent advisory against illegal offshore gambling websites in the garb of surrogate advertisements and news websites. This is a significant step to safeguard the players and industry at large by distinguishing legitimate skill gaming operators from illegal gambling sites that exploit vulnerable players.”

He further said, “At E-Gaming Federation (EGF), we have constantly urged both federal ministries and state governments to curb the menace of these unscrupulous fly-by-night operators that have been flagrantly violating laws like the Prevention of Money Laundering Act of 2002, Foreign Exchange Management Act of 1999, Payment and Settlement Systems Act of 2007, Consumer Protection Act of 2019, etc.”

Looking at the damage to the Adex, Shanu Jain, Vice President, Media Planning & Strategy, Dentsu Creative India says, “Due to the ban on surrogate advertisement in betting, we could easily see a decline of 5-7% in the Adex, which could be Rs 4,000 crore and upwards. It will also affect celebrity endorsements which was done by these betting and gambling platforms.”

The Role of Celebrities and Influencers
Over time, we have seen multiple Indian celebrities endorse such platforms. Actors such as Kiara Advani, Ranbir Kapoor, Nargis Fakhri, Sunny Leone, and sports personalities like Suresh Raina, MC Mary Kom, Saina Nehwal, Harmanpreet Kaur, among others, endorsed betting and gambling apps.

Platforms such as Parimatch, 1xbet App, Betway, bet365, 10cric, Betmaster, Raja Bets, among others, advertise heavily on sports properties, social media platforms, news publishing websites, etc. These platforms leave no stone unturned to promote their brand, in every way possible. Parimatch news for example had signed a sponsorship deal with the ultimate Kho Kho league team, Rajasthan Warriors. On the other hand, Fair Play news has top notch celebrities and cricketers endorsing the brand. A commonality between the two is that their parent company is involved in betting and gambling, and the link to their websites takes users to betting and gambling platforms.

Rohit Agarwal, Founder and Director, Alpha Zegus says, “These betting and gambling platforms have started to prefer celebrity and influencer endorsements over paid media, as celebrity endorsements come with very heavy advocacy value to them. A celebrity/influencer endorsing a brand means that they are putting their money where their mouth is, which leads people to believe that the website/app is highly reputed and funded.”

Moreover, several top influencer streamers and gamers in India showcase gameplays of casinos, slots and multiple card games available on the websites. The average watching audience of these gaming streamers range from age 13-24. Naturally, the reliability factor here is sky high. Seeing your favourite online personality making a bet online will leave a lasting impact. A sort of influence that a plain media advertisement would fail to have.

An insider from the gaming industry managing multiple bigwig influencer streamers says, “Streamers having a minimum of 500 live watchers, make $3000 per live stream. This live stream is mostly done on YouTube these days after a ban by Amazon owned Twitch on the streaming of some gambling content.”

He further elaborates, “However, some streamers also deal in cryptocurrency to keep the accounts clean. The unsuspecting audience often consider it as gaming and legal because it is being streamed live on a reputed platform like YouTube. While several betting and gambling apps also run a monthly affiliation programme, which would require a streamer to use the logo and link of the betting company to be displayed throughout the stream, this would cost the company $5000-10,000. But nowadays, Indian streamers have become responsible and often run a disclaimer or avoid showcasing such content to the audience.”

Applauding the move by the Indian government on banning advertisements of betting and gambling platforms, Lokesh Suji, Director, Esports Federation of India and Vice President of the Asian Esports Federation says, “It is definitely a step in the right direction to clear the misunderstanding that people have regarding gaming and real money gaming or gambling apps. We need video gaming and Esports to be completely separated from betting apps and fantasy games, as it negatively affects what we are trying to achieve with the gaming industry in India.”

He further says, “The video gaming industry in India is on course to achieve record-breaking revenues in the coming years and the recent achievements of India on the international stage in Esports are making the country proud. So it really doesn’t sit right that even after the ground breaking success of gaming in recent years, it is still being included with betting and gambling apps. Since advertisements are a big part of broadcasting awareness into the minds of people, this decision of the government will undoubtedly help and improve the gaming industry in the long run.”

Indian Government and gambling norms

• Online gambling and land-based casinos are legalized in Goa, Sikkim, Nagaland, and Daman under the Public Gambling Act, 1976

• Maharashtra has prohibited gambling and considers gambling as illegal under the Bombay Prevention of Gambling Act, 1887

• Several Indian states have legalized lotteries. These are Goa, Kerala, Arunachal Pradesh, Assam, Maharashtra, Madhya Pradesh, Mizoram, Manipur, Meghalaya, Punjab, Nagaland, West Bengal, and Sikkim

• Online game of chance is allowed in Nagaland, Sikkim and Meghalaya after obtaining licenses

(Source: Media reports)

Will RMG end up with the same fate?
Recently, Anurag Singh Thakur, Minister of Information and Broadcasting, stated in the Lok Sabha that the government received 117 complaints in 2020-2021 against RMG platforms for alleged misleading advertisements. This is allowed to happen at a time when advertising is being monitored closely by the Advertising Standards Council of India (ASCI), and the Ministry of Information & Broadcasting. According to FICCI-EY Report 2022, transaction-based game revenues grew 26% on the back of fantasy sports and rummy.

Sagar Nair, Co-founder and CEO of Qlan, a social network for gamers and esports, considers the narrative created by RMG players to be bizarre. He says, “Today, there is a fine line which divides RMG with casual gaming and Esports. It is important that the brand messaging done by RMG players is accurate. Moreover, it is time that Esports in India grows at a steady rate. Calling RMG as an Esport is not only misleading, but also a hindrance in the growth of Esports, and gaming as a whole.”

For Agarwal of Alpha Zegus, RMG and Esports have a different purpose altogether, he says, “The misconception of RMG and Esports/gaming being considered as same is true, and it’s about time there is a clear demarcation between the RMG space and Esports/gaming space. People play RMG games to make money - that’s the only objective to play them. People play esports/FPS games for entertainment - there is no monetary element involved in casual gaming. It’s vital to spread awareness on how the two domains operate in such different ways - be it their type of audience, skills required to play, monetary/non-monetary outcome, etc.”

Mohit Israney, Managing Director and Co-founder, Global ESports, sees the problem of betting, gambling apps advertising themselves as gaming, as a twofold problem. He opines, “The first is that quick-money lure to appeal to people’s greed, and the second is, confusing people to believe that all gaming and ESports are gambling. We have the world’s largest youth population, one that’s creatively exploring newer career opportunities. There’s a rise in domestic talent that is already pushing its way to the global stages, we will someday see us winning at the world stage too. But if anybody says they wanted to make a career in ESports or gaming, there’s a good chance it will be misinterpreted as casino or gambling. This is due to the wide spread misrepresentation of betting and gambling as gaming. The damage is huge and is already done, the ban will hopefully see its reversal beginning to trickle.”

Satyen Poojary, Strategy Head, Global Esports, explains how the two are widely different, “Just like in any sport, ESports doesn’t involve players putting their own money for participation. They compete over known variables and use their skill to outplay the opponent and win the objective. While RMG players are rejoicing over the directive, it too is positioning itself as a get-rich-quick scheme, which is a big problem. To put it simply, if you are great at cricket, let’s say batting, if you are participating in a tournament with a team - that’s a sport. However, if you are putting your money in for participating, it’s not a sport, it’s a hustle, and then if someone else is putting their money on a first ball sixer, it becomes plain betting, not cricket at all.”

RMG Vs State Governments

• In early August last year, the Supreme Court upheld fantasy sports format as a ‘game of skill’, in line with other judgments given by High Courts of Punjab, Haryana, and Bombay

• On August 3, 2021, the Madras High Court struck down the Tamil Nadu Gambling and Police Laws
(Amendment) Act, 2021 as being “ultra vires”

• On September 27, the Kerala High Court, relying on the Madras High Court order, struck down an
Amendment to the Kerala Gaming Act, 1960, which imposed a ban on online rummy.

• Recently, the Karnataka High court also uplifted the ban imposed by the amendments to Karnataka Police Act that banned online gambling

(Source: Media reports)

While the entire gaming industry is furious about RMG and offshore gambling platforms being considered as Esports and gaming, industry sources say that several meetings were conducted, and white papers made the rounds, to demarcate Esports and RMG.

Suji explains the distinction between the two, “It’s a no-brainer that these real money gaming apps cannot be considered as Esports as they have classified themselves into games of skill and games of chance, and the only reason why they are clubbed together is because of the Public Gambling Act of 1867, which is why the Indian government still considers the two as the same. Personally, I find this discouraging for the gaming community, and I think that it is about time that the government officially considers Esports as a real sport. We are already trying our best to spread awareness about the differences between RMG and Esports for the masses, and are waiting for it to get official recognition.”

It is indeed quite peculiar to weigh in on modern day e-gaming through the prism of an archaic law that was established in the year 1867. While the latest warning by the Ministry of Information and Broadcast is in good stead, several experts IMPACT spoke to echoed in unison that despite the ban, the platforms will continue to exist as the apps and websites are based and operated from outside the Indian jurisdiction.

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