Gaussian Networks Pvt Ltd’s online gaming website Adda52 that lets Indians play rummy and Poker is looking to expand its operations to the global market. However, it is currently not able to go ahead with its plans, due to the regulatory restrictions on foreign exchange.
Adda52 CEO Anuj Gupta told MediaNama that many of their (Indian) customers want to play with gamers outside, and the site wants to work towards creating a proper legal framework to facilitate this. The issue, largely, is with restrictions on flow of currency. “There are a lot of things we can do with Indians living in India, but not with people abroad. Our domain happens to be one of them, but that’s the nature of our law. Our currency is not fully convertible (one needs the permission of the Reserve Bank of India to convert large amounts of rupees to any other international currency) and in the future when Indian Rupee becomes fully convertible international currency we will take the website international. So we are not keeping a time limit for our international plans,” Gupta says.
Adda52 says it has more than two lakh registered users, but Gupta refused to divulge the exact number of active users. Most of its players are from the south (of India), especially from Bangalore, Chennai, Hyderabad, Goa and Mumbai, and mostly in the 25-50 age group.
The company makes money by takes a small cut of 2-5% on every winning hand.
Legal hurdles & Cash Points
When the company was set up in 2011, it had approached a Delhi court seeking clarification on the laws that they will need to follow to run such an operation in the country. The court had issued a verdict saying that online games that involve physical money are illegal and websites hosting these games cannot be offered protection under the constitution. Gaussian Networks had then approached Delhi High Court after this verdict, but there has been no progress on that case yet.
To workaround this restriction, Adda52 allows people to play games using cash points, which is similar to the virtual coins used in Zynga poker. Overall Adda52 uses three types of points — freeroll, cash and loyalty. When you sign up for the game, you received a little less than 100,000 free roll points immediately. Using these points one can play against others in a lobby dedicated to non-cash points players, but there is no way to cashout the winnings thus received.
Buying cash points was as easy as buying any item on an e-commerce site and the current rate was 1 cash point for every rupee. Accepted payment methods included credit/debit cards, bank transfer and there is even an option to get someone to pick up cash from an address you specify. Cash lobbies have buy-ins that differ from vary from 20/80 cash points to 15,000/60,000. For those who are not familiar with poker, that’s the minimum and maximum points/cash you can get to a table. Of course, there is an option to automatically top-up points if you’re running low on funds half way through a game from your Adda52 cash points balance.
You earn loyalty points by referring people to the website. You can win bonus chips when a person you refer plays a game using cash points. For every 100 loyalty points earned by your friend (by referring other friends), you receive 20 cash points.
Why discriminate against online players?
The main discussion point in poker related law suits has been the classification of poker as a skill game, but the recent Karnataka High Court ruling has been a shot in the arm for all companies involved in this domain in India. The court had said that if poker is played as a game of skill, license is not contemplated and that the petitioner (in this case it was clubs that played card games) was entitled to conduct skill-based games, provided, the same is in accordance with law.
This being the case, Gupta feels there shouldn’t be any reason to discriminate against the same game just because it’s happening online. “There is more transparency with online games as we have complete information and transaction records of where money comes from, even though it’s not mandated. So if you adopt good business practices online, it is much more transparent and tomorrow even if gambling is allowed online, it will be very easy to monitor,” Gupta says.
“We do not encourage players to withdraw winnings as money, instead we encourage them to opt for electronic goods such as mobiles and tablets,” he says. However, it is possible for players to withdraw their winnings, but they need to go through a Know Your Customer (KYC) process beforehand and also provide their PAN card number if they are trying to withdraw large amounts.
At Adda52, we noticed that only cash points could be redeemed with the minimum amount that could be taken out being Rs 100. You can redeem via online bank transfer (takes a week) or using a cheque (2 weeks). However, before you can do this you’ll need to verify your mobile number after which you’ll need to go through KYC process if the withdrawal amount is high.
No deal if you’re from Assam or Odisha
While going through the website, we noticed that residents of Assam and Odisha were not allowed to buy coins to play games on Adda52 as they are the only states in India that have outright banned participation in skill-based games.
Shifting focus to Rummy?
In the long run, Gupta said Adda52 would like to concentrate on all players in the sub-continent and even expand operations to South East Asia. However, the poker market is overcrowded internationally, so if and when the site does goes international, concentrating on rummy just might be its best bet. Currently Rummy does not have a centralised international culture, and all events are region or continent specific, because of which much of the sponsorship is for poker, and not rummy. The company has recently doubled-down on its rummy offerings by launching 21 card rummy apart from the 13 card variant that is common among online gaming sites in India.
That said, Adda52 had tied-up with ATP Manila and ITC Colombo for poker tournaments, wherein it organized regional qualifiers and sponsored the flight and ticket entry fares of winning players.
According to Gupta, Indians are more comfortable with playing rummy as opposed to poker as the latter is pretty new in India. “People have been playing rummy for a while here, so there is some understanding, but people above 45 hardly play poker. It’s a new game for them, so we’ll continue to focus on both of these games for now, and may be also on other games such as bridge or court piece. Online rummy gained traction in 2007 so it has a big lead,” he says.
P.s.: As as aside, one of the founders of Partygaming, was IIT Delhi graduate Anurag Dikshit. More on him at Wikipedia.