The IT Ministry bowled a googly in Parliament today. Two Congress MPs asked it about why online games publishers were classified as intermediaries, presumably under India’s proposed online gaming rules. “The said definition [of intermediaries in the IT Act and IT Rules] does not include publishers within the meaning of the term ‘intermediary’,” the Ministry replied.
Why it matters: The IT Ministry unexpectedly shed light on the multiple concerns over how India’s proposed online gaming rules characterise gaming platforms today.
What does that mean?: The rules classify gaming platforms as “online gaming intermediaries”. Typically, “intermediaries” are platforms that host and transmit third-party content. They don’t actually publish content of their own. Because of this, they’re given “safe harbour” protections under Indian law—which protects them from being held liable for any dodgy third-party content they end up hosting. Given that they actively control and publish games, some think gaming platforms can’t be termed intermediaries or given safe harbour protections. Others think that as long as they carry third-party content, they’re intermediaries. The government’s answer today could imply that platforms publishing online games aren’t intermediaries. If that’s the case, then how will the final draft of the rules carve out this exception?
How do gaming platforms view themselves?: “Gaming companies traditionally have said that they are publishers,” argued MediaNama‘s Editor Nikhil Pahwa at our event on the proposed online gaming rules last month. “They have treated themselves like movie studios. […] Secondly, there is a part of the interaction that happens with a medium separately and a part of the interaction with other players. So it’s a three-way thing that happens with individuals and the medium. It’s not a conduit under the traditional definition of an intermediary.”
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Where else has online gaming cropped up this Lok Sabha session?
Answers on gaming ads indicate that illegal betting sites are a problem
Do “attractive” online gaming ads cheat consumers?: The government didn’t necessarily point fingers at the entire online gaming industry—noting that it was betting that’s illegal in India. “With the expansion of the Internet and more and more Indians coming online, the potential for Indians being exposed to illegal applications including betting, has also increased,” the IT Ministry said in response to BJP MP Raksha Nikhil Khadse.
But how will the advertising question be addressed?: The IT Ministry added that the proposed rules to regulate online gaming were one step towards making the Internet “Open, Safe, and Trusted and Accountable” for Indians. The rules set out certain due diligence requirements for online gaming platforms to follow, including causing users “not to host, display, publish, transmit or share any information that causes incitement to the commission of any cognizable offence, or encourages gambling, or violates any law for the time being in force”.
The Ministry of Information and Broadcasting (MIB) also advised print and electronic media to refrain from publishing ads for online betting sites, displaying such ads, or targeting them towards Indian audiences. It further “issued an advisory to private satellite TV channels on 04.12.2020 to comply with guidelines of Advertising Standards Council of India (ASCI) on advertisements related to online gaming and for carrying certain disclaimers etc. to protect consumer and inform them regarding financial risks and other factors involved in online gaming,” MIB added in response to BJP MP Manoj Kotak.
What about regulating gaming ads targeting children?: “The Cable Television Networks (Regulation) Act, 1995 and rules framed thereunder require that all advertisements telecast on private satellite TV channels adhere to the Advertising Code, prescribed under the Act,” said the Ministry of Information and Broadcasting. “The Government takes action in cases where Advertising Code is found to be violated by private satellite TV channels. The Ministry also issues advisories from time to time to broadcasters for ensuring compliance to the Advertising Code.. Further, Central Consumer Protection Authority under Ministry of Consumer Affairs has issued “Guidelines for Prevention of Misleading Advertisement Rules, 2022” vide notification dated 09th June 2022 which inter-alia prescribe conditions to be adhered to in respect of advertisements targeting children and advertisement prohibited by law.”
Government is clear that states alone regulate betting and gambling
Will the government propose strict laws to ban online gambling and betting?: No. The government was clear that this is the job of state governments.
Responding to BJP MP Rajendra Agrawal, the IT Ministry said “State Legislatures have exclusive power to legislate on matters related to betting and gambling… Moreover, as per the Code of Criminal Procedure, 1973, prevention and investigation of cognizable offences is to be done by the police and “Police” is a State subject under the Seventh Schedule to the Constitution. States are primarily responsible for the prevention, investigation etc. for action on illegal betting and gambling. Accordingly, State police departments take preventive and penal action as per law in respect of illegal betting and gambling.”
Will the proposed online gaming rules supersede state powers and end regulatory fragmentation?: The proposed online gaming rules are a subset of the Indian government’s larger IT Act. “These rules are not in derogation of laws enacted by State Legislatures [on betting and gambling],” the government clarified in response to Congress MPs K. Muraleedharan and Benny Behanan.
Finances and harms of the online gaming sector are underdocumented
What about the income of online gaming sites?: BJP MP Khadse also questioned the IT Ministry on the number of online gaming sites in India, whether they have to mandatorily register, their daily turnover, and their revenue earned by tax collection. The government doesn’t maintain this information, the Ministry replied.
Tracking investments in “illegal places” through online gaming: The government clarified that it isn’t considering surveying the amount of money or the people investing in “illegal places” through online gaming.
How many Indians died by suicide due to online gambling and harassment?: National Crime Records Bureau data indicates that 7 cases were registered in India under the “abetment of suicide” sub-category of cybercrimes in 2019, said the IT Ministry. 2020 and 2021 saw 10 such cases each. These figures are reported by the state police and other law enforcement agencies.
We’re not sure if these numbers accurately capture online gambling-related suicides. For example, when the Tamil Nadu government banned online gambling last year, it did so after at least 17 reported online gambling-related suicides in the state over the last three years. On the other hand, the figures provided in the Ministry’s response suggest that no cybercrime-related suicides took place in Tamil Nadu between 2019 and 2021.
What is the government doing to support gaming start-ups?
There are lots of schemes underway (take notes, founders), said IT Ministry. They include:
- Technology Incubation and Development of Entrepreneurs (TIDE 2.0): The scheme provides “financial and technical support to incubators engaged in supporting ICT startups using emerging technologies such as IoT, AI, Block-chain, Robotics etc”. It’s being implemented through 51 incubators currently.
- Centre of Excellence on Gaming, VFX, Computer Vision & AI: The IT Ministry recently established the Centre in Hyderabad—it’s being implemented by the Software Technology Parks of India (STPI) with the support of the Telangana government and the “industry”. The Centre will offer programs and labs for start-ups to scale up through, while an accelerator program “includes premium plug and play co-working space for start-ups and offers access to the ecosystem which comprises of IP owners, mentors, investors and a platform to support Go-To-Market strategy”. 20 start-ups have been onboarded so far.
- Centres of excellence (CoE): The IT Ministry has “envisioned and operationalised” 26 CoEs to “capture new and emerging technology areas”.
- Start-up Accelerator Programme of MeitY for Product Innovation, Development and Growth (SAMRIDH): SAMRIDH supports upcoming and existing accelerators to select potential start-ups to scale. 300 start-ups are to be supported under SAMRIDH, says the IT Ministry.
- Next Generation Incubation Scheme: The scheme supports the software product ecosystem, partially fulfilling the aims of 2019’s National Policy on Software Product. It hopes to support 300 start-ups in Tier 2 and 3 cities over three years. It will be launched from 12 cities—Agartala, Bhilai, Bhopal, Bhubaneswar, Dehradun, Guwahati, Jaipur, Lucknow, Prayagraj, Mohali/Chandigarh, Patna and Vijayawada.
- Support for International Patent Protection in E&IT (SIP-EIT) Scheme: The Scheme encourages international patent filing by start-ups and MSMEs. “Reimbursement provided under the scheme is upto a maximum of Rs.15 lakhs per invention or 50% of the total expenses incurred in filing and processing of patent application upto grant whichever is lesser,” says the IT Ministry.
- Gen-Next Support for Innovative Startups (GENESIS): The program hopes to “discover, support, grow and make successful startups in Tier-II and Tier-III cities with emphasis on collaborative engagement among startups, government and corporates for promoting digitization based on the principals of inclusivity, accessibility, affordability, leading to growth in employment and economic outputs”.
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