Last week we wrote about the ongoing debate in Louisiana about daily fantasy sports (DFS) games. Are they gambling, or are they really games of skill?
DFS has become a huge business in the US, with the two major players – Fan Duel and DraftKings – both valued at more than $1bn. But the market in the US (population 324m) pales into insignificance compared with the potential market in India, with its population approaching 1.4bn.
This week India’s top court has – almost – given its approval to fantasy sports betting in the country. Given the country’s fanatical devotion to cricket, the worldwide success of the Indian Premier League and the emerging Indian Super League in football, the potential for DFS in India is enormous.
Some legal history
In April 2017, Varun Gumber, an Indian lawyer, submitted a complaint to the courts in the hope of having criminal charges brought against the online fantasy sports website, Dream11 – India’s ‘biggest sports game’, which allows players to play daily cash contests via their mobile phones.
Justice Amit Rawal ruled that DFS games are not gambling and require a considerable amount of skill, explaining that participants had to “continually track player activity, sporting events, previous records, weather and other factors” in order to take part.
Not content with this ruling, Gumber took his case to the Punjab and Haryana high court later in the year. The two high court judges backed the original decision and dismissed Gumber’s petition.
While the dismissal only relates to the “criminal” complaint and does not technically make DFS games legal, it does suggest that legalization will happen at some point in the future, while pure gambling will remain illegal in India.
Over in Louisiana, state laws prohibit gambling but a proposed bill would exempt DFS contests from that legislation.
Should the bill go through, the final decision on whether DFS contests become legal would be decided by a state-wide referendum on 12 October 2019.
The potential for DFS in India
DFS in India has increased rapidly in popularity over the last two years. There are currently around 7m players, with that number increasing by 30% each year. Currently 400m Indians – around one-third of the country’s population – access the net via their smartphones.
The Indian Premier League is the leading T20 competition in cricket. First held in 2008, it takes place in April and May with the leading players in the world being bought for millions of dollars.
Among the favorites this year will be Royal Challengers Bangalore – led by the Indian test captain and sporting superstar Virat Kohli – and the Rajastan Royals, captained by Australian skipper, Steve Smith. (In something of a snub to his ego, England captain Joe Root wasn’t picked by any of the teams…)
All the teams are made up of a mix of local players and imported foreign stars, and there is an obvious potential for making your own fantasy team. Whichever team you support in the IPL, the chances are that your favorite players will be spread throughout the league.
Gambling on the IPL
With gambling is illegal in India, does that stop people betting on the IPL and the Indian Super League? Far from it. There are networks of illegal bookmakers throughout the country and apocryphal tales are told of people betting cars, jewelry, houses and land – and if they win, being paid out in sacksful of cash.
The Indian government recently scrapped some low denomination notes in a bid to curb the black economy in the country but gambling – like other vices – will always be with us.
Estimates put the amount of money that will be wagered illegally on this year’s IPL at around ￡2bn, clearly showing the huge potential for DFS games if they are made legal, or tacitly accepted as a game of skill by the Indian courts.
Don’t be surprised to see further attempts to have DFS blocked in India. However, my guess is that they will be allowed to flourish, with the authorities recognizing that they provide an alternative to the illegal bookmakers. After all, you cannot (yet) bet your house on daily fantasy sports.
