Jobs Lost Thanks to India’s RMG Betting Ban
Hundreds of jobs are being cut in India following the country’s move to ban real-money online gaming.
Hundreds of people in India could be set to lose their jobs.
Key Facts:
- India previously had some of the world’s most complicated rules and regulations around betting and gambling
- The Real Money Games (RMG) industry included the likes of fantasy sports games, poker and online games
- But India recently passed a law restricting the RMG sector
- Job cuts are now taking place quickly across the RMG industry
India recently announced it was banning the RMG sector over fears that playing them could lead to addiction and financial distress for people.
Offering and enabling such games is now against the law in India, with Federal IT Minister Ashwini Vaishnaw arguing online money games had harmed 450 million people in the country, telling parliament that it also caused losses of over 200 billion rupees.
India had in the region of 400 RMG startups that were said to support over 200,000 jobs in the country, as well as generating nearly $2.3 billion in annual taxes.
RMG also became a firm fixture in the sporting landscape, with one top fantasy sports provider – Dream11 – even becoming the shirt sponsor for the India cricket team.
Job Cuts on the Way
Due to the new RMG ban, companies in India are having to cut costs and shed jobs as a result.
Local media suggests one major RMG provider, Mobile Premier League (MPL), is cutting some 300 jobs thanks to the change in regulations. MPL, which had partnerships with the NBA and the Pro Kabaddi League, will lose around 60% of its workforce.
At present, MPL’s website and app are currently not accepting deposits, which it says are “in compliance with the law”.
However, the company still plans to offer free-to-play games and many RMG providers may have to follow suit to avoid falling foul of the new laws. Indian high courts have previously ruled RMG should be classed as in the skill category and therefore cannot be treated as gambling.
Dream11’s parent company, Dream Sports, has said it has lost the vast majority of its revenue thanks to the RMG ban, but does not currently have plans to shed jobs.
What Happens Next?
Investors in RMG companies in India are set to be hit particularly hard by the ban by Prime Minister Narendra Modi’s government, which came as a surprise to many within the industry.
Jay Sayta, a gaming lawyer based in the Indian city of Mumbai, argued that millions of dollars worth of investment has been put into the RMG sector. Sayta told the BBC in an interview that the ban was a “massive setback” for such investors, with Dream11 previously having been valued at $8 billion.
Venture capital firms like Tiger Global and Peak XV Partners are among those to have invested heavily in the sector, which was forecast to be worth $3.6 billion by 2029.
Smrita Singh Chandra, a previous policy communications staff member at Dream11, wrote on his LinkedIn profile that the ban had been brought in “without transition, nuance, or consideration of economic realities”.
It has also been suggested by Indian gaming federations that closing down “regulated and responsible Indian platforms” could lead to a rise in illegal online betting. WhatsApp or Telegram groups are often used to bet illegally in India, while virtual private networks can also be used to circumvent internet blocks.
Head Digital Works, which runs A23 Rummy Online and A23 Poker Online, has announced it intends to legally challenge the new gambling ban in India.
