Govt task force restarts debate on status of online gaming platforms

NEW DELHI: A high-level interministerial task force (IMTF) set up by the government to chart rules and regulations for the online gaming sector has restarted the debate on whether aggregators offering such games are intermediaries or publishers, with ministries arguing the merits of taking both positions.

The report notes that it has to be validated whether online gaming platforms — while simultaneously acting as intermediaries and publishers of gaming content — can be regulated through rules under section 79 of the IT Act.

IMTF, in its recommendations, said that in the long term, it favours a new central legislation that will license the online gaming sector and also provide the government with powers to block/deregister entities violating India’s laws. It has not, however, spelt out what constitutes an online gaming platform.

The report notes that “the revenue of the Indian mobile gaming industry is expected to exceed USD 1.5 billion in 2022, and estimated to reach USD 5 billion in 2025. The digital gaming industry in India had a CAGR of 38% between 2017-2020, as opposed to 8% in China and 10% in the USA”.

“The number of digital gaming companies in India has increased from 25 in 2010 to over 275 in 2020. The sector currently employs around 15,000 skilled developers in India,” said the report, seen by HT. “It was deliberated in the IMTF (the task force) as to whether the section 79(2)(c) of the IT Act, providing for rulemaking power to prescribe due diligence to be observed by the intermediaries to claim safe harbour under section 79(1) against third party content, can be used for regulating online gaming platforms while acting as publishers,” the report stated.

According to the ministry of information and broadcasting, “online gaming platforms play a significant role in determining the information/content being offered to users, hence such platforms are not intermediaries but publishers of online content”.

The online gaming sector can be split up into two broad classifications: networks and developers. Developers are companies behind single products, for example, the popular football game Fifa is developed by the Silicon Valley company Electronic Arts. Networks are those on which these games become available, for example Sony’s PlayStation Network and Microsoft’s Xbox network.

In these, the networks loosely act as platforms while the developers can typically be considered to have a similar role as that of a publisher. But the question of which tag – publisher or intermediary – is used for the latter is complicated. If online gaming platforms are recognised as intermediaries, they will be exempt from penal action for publishing third party content. However, as publishers, they will be held responsible for content.

THE PANEL REPORT NOTES THAT IT HAS TO BE VALIDATED WHETHER GAMING PLATFORMS CAN BE REGULATED THROUGH RULES UNDER SECTION 79 OF THE IT ACT