Why regulation of online gaming could disrupt Indian market despite possible positives

Online gaming has expanded greatly in the Indian market in recent years with the boom in the mobile games industry. While the semiconductor chip shortage has affected the PC and console markets, mobile gaming has increased in volume.

People no longer play titles just for fun, as the esports section of mobile gaming has also evolved. Given how many of the younger demographics are getting involved with the activity, the Government of India has discussed a roadmap to regulate the world of online gaming.

However, there's a strong case against this as it could do more harm than good.

Online gaming differs from most other games, especially modern live-service titles. Most of these games are free to play, especially on phones.

While there are microtransactions, they're not required to be competitive in these titles. This makes games like BGMI and Free Fire extremely popular among the youth.

The ability to go competitive and compete with strangers and friends alike makes them exciting choices. It's the potential scope that the government has noticed, and they feel a proper roadmap is required.

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Any official regulation on online gaming could be disruptive to industry

There's no denying that regulation is required for the efficient working of most industries. A lack of the same can open the sector up to particular issues that can cause harm for all the stakeholders.

Regarding online gaming, regulations could have their own set of advantages. However, there could also be certain disadvantages due to the peculiar nature of online games.

According to reports, India has the second highest online gaming base, following China. While the breakup of mobile and non-mobile gaming isn't available, there's no denying the role of games like PUBG, Free Fire, and more.

The strength of the market is well understood by certain facts like FIFA Mobile opening a separate server for the Indian subcontinent.

Incidentally, PUBG Mobile was banned in India for an extended period, but Krafton decided to create a separate client for the Indian region. Both instances show the prospective market available to the developers for their benefit.

There are certain aspects of these games that can prove to be harmful. Microtransactions are one area that has come under fire in many countries.

Many policymakers believe that children can get addicted to gambling due to the loot box mechanics of these titles.

Another significant issue is the potential screen time a child might go through due to these games. There has been violence from teenagers due to their parents obstructing their activities.

Data privacy is another sensitive area that has seen several games like PUBG Mobile and Free Fire facing bans.

Any potential regulations on online gaming by the Indian government will likely focus on these areas. However, there could be certain hindrances that will also be created due to the same reasons mentioned above.

A restriction on loot boxes or a limit on in-app spending will effectively mean financial losses for the companies.

This will prove a major obstacle for them, which could even force them to think against conducting the several tournaments currently going on. Participating in these events also requires major hours of daily practice.

Imagine competing against opponents from other countries who can practice for more extended hours! Rationing the game time by a dictate of the law will bury the hopes of many.

The whole issue of data privacy is a gray area, to begin with. It's seen as one of the several possible reasons why League of Legends: Wild Rift might not have arrived yet in India, and this is just one instance.

The whole privacy issue is always complicated and could disincentivize developers even more.

There's no denying that regulation is required in India's online gaming world. However, any policy will have to be well thought-off as the chances for it to go sour are pretty high.

Note: This article is subjective and reflects the author's views.