In India, there is a shift toward a uniform legal approach to online fantasy sports
Fantasy sports leagues have become increasingly popular and commercialised since the internet's introduction in the 1990s. Fantasy sports platforms and operators have created a variety of tournaments based on the type of sports, the length of the season, and the number of sports teams. Sports enthusiasts can create fantasy teams and compete against other fantasy teams, with the winner determined by how well individuals or teams do in real-life events. Participants pay a fee to the fantasy sports league organisers and then form one or more fantasy teams to compete against other players.
Fantasy sports competitions began in India in the early 2000s, but it took about a decade for them to acquire traction, owing to the availability of affordable cell phones, internet penetration, and the development of various mobile application platforms. Dream11, Mobile Premier League, HalaPlay, world777, MyTeam11, BalleBaaz, iGamio, and Nostra Pro are some of the most popular fantasy sports platforms in India.
Global scenario and trends in online gaming and fantasy sports in India
The online gaming sector is one of the fastest growing industries in the world, and the fantasy sports segment is a significant part of it. It was worth around USD 20.69 billion in 2020, and it is predicted to expand at a CAGR of 12.8 percent to USD 48.07 billion by 2027. The United States is one of the largest marketplaces for online fantasy sports, with a market value of USD 8.4 billion anticipated for 2021.
India is becoming one of the most important markets for fantasy sports and online gaming. In 2020, it is estimated that 100 million people would have joined various fantasy World777 sports platforms, and roughly 14% of smartphone users in India now use fantasy sports gaming apps. In 2020, the segment generated gross revenue of USD 340.47 million, a 3X increase over revenue in 2019. (USD 131.64 million). By 2024, the market is predicted to be worth USD 3.7 billion. Investors have shown a strong interest in this sector, with an estimated USD 112 million invested in fantasy sports platforms over the last five years.
Kalaari Capital, Tiger Global Management, Think Investments, Kae Capital, Multiples Alternate Asset Management, and Steadview Capital Management are some of the active investors in this industry in India.
The legal and regulatory environment
Despite the enormous potential for expansion of fantasy sports activities in India, the regulatory framework governing online gaming and fantasy sports has remained mainly murky.
The question over whether fantasy sports are a "game of skill" or a "game of chance" lies at the heart of the legality controversy in India. Due to the enormous public interest issue of sports betting and gambling, the Indian government has taken a cautious approach to examining such leagues and events, particularly where the prize involves direct cash payments. Despite the fact that many jurisdictions (including India) have laws prohibiting wagering or gambling on sporting events, sport betting is a significant industry with an estimated value of USD 218.49 billion as of March 2021. In India, there has been a growing clamour for the legalisation of sports betting in recent years (with certain regulations and guidelines).
There is no national legislation in India that governs the topic of online games and fantasy sports. The Public Gaming Act of 1867 (the "Gaming Act") is the fundamental federal law that regulates gambling and betting. The Gambling Act makes an exception for games with a skill component, and these games are considered legitimate. The Gambling Act, on the other hand, does not specify or define what constitutes or is judged to be a 'game of skill.'