Fantasy vs Betting

A fantasy is a type of game, often played using the Internet, where participants assemble imaginary or virtual teams composed of proxies of real players of a professional sport. These teams compete based on the statistical performance of those players in actual games. This performance is converted into points that are compiled and totaled according to a roster selected by each fantasy team’s manager. These point systems can be simple enough to be manually calculated by a “league commissioner” who coordinates and manages the overall league, or points can be compiled and calculated using computers tracking actual results of the professional sport. In fantasy sports, team owners draft, trade and cut players, analogously to real sport.

The first leagues

In the 1950s, Oakland, California businessman and future limited partner in the Oakland Raiders Wilfred “Bill” Winkenbach developed a fantasy golf game in which participants would select a roster of professional golfers and compare their scores at the end of a given tournament, with the lowest combined total of strokes winning. He also created a baseball game in which players drafted hitters and pitchers, comparing their real-life statistics against each other. These early experiments, however, failed to spread to the general public.

In 1960, sociologist William A. Gamson developed the Baseball Seminar league, in which participants would draft rosters of active MLB players and compare results at the end of the season based on the players’ final batting averages, earned run averages, runs batted in, and win totals. Gamson would go on to play the game as a professor at the University of Michigan, where another competitor was Bob Sklar. One of Sklar’s students was Daniel Okrent. According to Alan Schwarz’s The Numbers Game: Baseball’s Lifelong Fascination with Statistics, Sklar told Okrent about the Baseball Seminar league.

How is Betting and Fantasy differentiated under Indian laws?

A game completely depended on an outcome of a specific event without involving any skill on the part of the participant is defined as Betting whereas Fantasy Sports does not depend on the outcome of a real-life event and is purely based on the skills of the participant involving knowledge of the sport, players likely to participate, players’ forms, weather conditions and such other related factors. The Outcome achieved by a participant of a Fantasy Sports Game has no dependency whatsoever on the outcome of the real-life game.

The principal legislation governing gambling in India is the Public Gambling Act, 1867 (“PGA”). The PGA criminalises the act of ‘gambling’ in a public forum and the keeping of a ‘common gaming house’. The PGA, however, creates an important exception in favour of a game of skill, by stating that the provisions of the PGA shall [not] apply to any ‘game of mere skill’ wherever played.

Betting illegal in the country, but there is no ban on the 2500 crore fantasy game industry

An advertisement became very popular during IPL and Cricket World Cup. In this, Mahendra Singh Dhoni asks the audience to make his team. Actually, it is a kind of fantasy i.e. virtual game. In this you have to create an online team. You can participate in free entry or paid contests. Although betting with money is considered betting, but this law does not apply to them.

These companies claim that it is not a matter of chance but a completely skill based game, that is, you play on the basis of skill. The same thing has also been said by the Supreme Court in the hearing of the case related to this. Apart from Dhoni, players like Sourav Ganguly, Yuvraj Singh, Chris Gayle and Harman preet Kaur are also associated with these companies and promoting them. Fantasy sports was started in America in 1952, but in India it was started in 2001 by ESPN-Star Sports, it was closed in 2003.

Tharoor has introduced the Private Member Bill

Congress MP Shashi Tharoor has also introduced the Sports (Online Gaming and Prevention of Cheating) Bill, 2018 as a private member bill in the winter session of Lok Sabha. According to him, even though betting is a state subject, online gaming comes under the jurisdiction of Parliament. Regulating online gaming in India is important as it is a rapidly growing sector. This can help in increasing the revenue of the states and check black money.

More than 70 such companies are active in the country.

The popularity of fantasy games can be gauged from the fact that there are more than 70 such companies active in the country. More than 60 million users are playing daily in Dream-11 alone. This figure is expected to cross 10 crores by the end of the year. Dream-11 has also become the country’s first gaming unicorn. Unicorns are called companies whose value is at least $100 million (Rs 7,000 crore). After receiving a second round of investment from hedge fund Stead view Capital, the valuation of Dream-11 has crossed $100 million. It was started by Bentley University alumnus Bhavit Seth and Pennsylvania and Columbia University alumni Harsh Jain.

What is the law regarding betting in India?

According to the Public Gambling Act-1867, betting and gambling have been considered a crime in the country. Betting and gambling are illegal under the Contract Act, Prevention of Money Laundering Act (PMLA), FEMA, Indian Penal Code (IPC), Income Tax and Consumer Laws. However, both of them are state subjects. That is, if the states want, they can make laws for this according to their own. Many activities related to betting and gambling are legally recognized in Goa, Daman-Diu, Telangana and Sikkim. In 1966, the Supreme Court recognized horse racing and betting in rummy, saying that it is not a game of chance, but it requires cleverness and skill. The Lodha Committee report cited examples that betting is legal in England, the US, Australia, Canada and some countries in Europe, giving these countries substantial benefits from levying taxes. If betting is legalized in India too, then the government can get a revenue of about 20 thousand crores annually.

If betting becomes legal, the government will earn 20 thousand crores annually.
According to research firm Statista, in 2012, there was a bet of $ 88 billion (about Rs 6.10 lakh crore) in India. It increased to $ 130 billion (about Rs 9 lakh crore) in 2018. According to an estimate, every cricket match in India involves betting worth about Rs 1,400 crore. In July 2018, the Law Commission and earlier the Lodha Committee recommended legalization of betting in cricket.

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