- Online gaming has flourished during the pandemic due to lockdowns. The average time spent on online gaming has gone up almost 65% from pre-Covid levels.
- More than 43 crore people have spent time on virtual gaming.
- The online gaming industry in India is home to over 275 gaming companies, more than 15,000 game developers, and around 300 million gamers.
- Recently, a Member of Parliament urged the government to come up with a comprehensive framework to regulate online gaming.
About online games in India
- According to the All-India Gaming Federation, India’s online gaming industry is expected to be worth ₹15,500 crores by 2023.
- A 2019 survey by the U.S.-based Limelight Networks found that India had the second-largest number of gamers after South Korea.
What are the types of online gaming?
- The types of online games include:
- Fantasy sports
- Skill-based(mental skill)
- Chance based(like the roll of a dice)
What is the present legal framework with respect to online gaming in India?
- Presently, online gaming falls in a regulatory grey area and there is no comprehensive legislation with respect to its legality.
- Games based on skills are allowed in most parts of the country, while games of chance are categorized under gambling, treated as immoral, and prohibited in most parts of the country.
- As betting and gambling is a state subject, different states have their own legislation.
- Every state except Goa, Sikkim, and the UT of Daman prohibits any sort of gambling, betting, or wagering on games of chance.
Debate on the game of skill versus chance in Online gaming
- Various High courts have legitimized gaming formats like fantasy sports etc as online games of skill.
- In the Junglee Games case, the Madras High Court ruled that games like Poker and Rummy are games of skill.
Why did India need to regulate online gaming?
Various health issues associated with online gaming
- Gaming addiction:
- Numerous people are developing an addiction to online gaming. This is destroying lives and devastating families.
- Compulsive gaming by children is affecting their performance in schools and impacting their social lives& relationships with family members.
- The Union Government has issued an advisory to parents and teachers on the threats posed by online gaming.
- Impact on health:
- Gaming addictions cause physical, social, and emotional damage, impairing sleep, appetites, careers, and social lives.
- The addiction can also cause insomnia, cause near-sightedness, withdrawal from social contacts, academic failure, and extreme anger and irritability.
- For instance, Online games like PUBG and the Blue Whale Challenge were banned after incidents of violence and suicide.
- For these reasons only, the World Health Organization categorized gaming disorder as a mental health condition in 2018.
Other reasons to regulate online gaming
- The online gaming industry is expected to generate revenues in excess of Rs 29,000 crore in 2025 with over 65.7 crore users.
- It is estimated that more than 15,000 direct and indirect jobs will be created,
- The GST and Income Tax generated from this industry will add to the Government’s revenue,
- Potential to attract significant global investments.
- Offshore gambling websites:
- Most of the betting in India is done on cricket matches, through websites like Betaway, Bet365, and Dafabet.
- These websites are headquartered in tax havens like Malta, Cyprus, and Gibraltar but are accessible to Indian users.
- Third-party wallets:
- In India, third-party wallets like Skrill and Neteller are used to funnel money into gambling sites, which can be used to make payments anonymously.
- Threat to Data privacy:
- Inadvertent sharing of personal information can lead to cases of cheating, privacy violations, abuse, and bullying.
- Betting and gambling.
What can be done by the government to regulate online gaming?
- The center can take steps to block sites under Section 69A of the Information Technology (IT) Act. Stringent measures are also required to prevent illegal services from being advertised or promoted through direct or surrogate means online.
- A Gaming Authority at the central level should be created.
- Since the blocking of illegal websites lies in the Centre’s jurisdiction, states may follow the Maharashtra Police’s model to deal with digital piracy.
- Centre should formulate an overarching regulatory framework for online games of skill. India must move beyond skill-versus-chance debates to keep up with the global gaming industry.
- India can follow a hands-off approach like advanced jurisdictions like UK exempt skill games from licensing requirements that apply to games of chance.
- The government can regulate the online gaming hours for Children like China limited gamers under 18 years to just three hours of online games per week.
What can be done by gaming platforms to regulate online gaming?
The online gaming platforms can
- Strengthen the KYC norms,
- Implement an age-rating mechanism
- No in-game purchases to be allowed without adult consent.
- Gaming companies should proactively educate users about potential risks.
- Anonymity of participants should be removed.
- Encourage self-regulation.
More and more youngsters are getting hooked on online games. In light of this, the Online gaming industry needs to be regulated in India. Moreover, regulation of online gaming will not only open up economic opportunities but also address its social costs.