MPL Faces Major Workforce Reduction Due to iGaming Ban in India
Mobile Premier League (MPL), a prominent player in the online gaming and esports sector, has announced plans to significantly reduce its workforce in India, citing the recent ban on iGaming by the national government. This move will affect approximately 60% of their total employees.
In August, the Indian government put forth a legislative proposal aimed at dismantling the nation’s booming online gambling sector, which was subsequently passed by the upper house of Parliament and received presidential approval on August 22. The new law targets any game requiring users to pay fees or stake money for potential monetary returns.
The market has already felt the repercussions of the impending restrictions. For instance, Flutter Entertainment announced the cessation of its Junglee real-money gaming operations as of August 25, reflecting the immediate impact of the regulatory shift.
MPL has also been affected; its MPL.live platform has halted operations, replacing its usual interface with a message stating, "Deposits are no longer available on the MPL app. In compliance with law, no cash games are available on MPL."
In an internal communication shared last week, MPL’s management informed staff about the forthcoming job cuts. CEO Sai Srinivas articulated the difficult decision to "downsize its India team significantly," though specific numbers were not disclosed. A source within the company indicated that around 300 out of the 500 employees could be let go, affecting various departments, including marketing, finance, operations, engineering, and legal.
Srinivas expressed regret over the situation, emphasizing their commitment to support those affected during this transition. He noted that India represented half of the revenue for M-League, indicating that the ban would effectively nullify their income from the country for the foreseeable future.
Despite the challenges in India, MPL is looking beyond its borders, with intentions to expand into the U.S. market.
Challenges Surrounding the iGaming Ban in India
The abrupt introduction of the iGaming ban has sparked pushback from industry players. Following the announcement, gaming firm A23 initiated a legal challenge against the proposed legislation. Their filing in the High Court of Karnataka claimed that the ban criminalizes the lawful business of skill-based online gaming, potentially leading to the abrupt closure of numerous gaming companies. A23 argues that the law embodies "state paternalism" and seeks to have it declared unconstitutional for skill games like rummy and poker. A23 serves over 70 million players on its platform.
Concerns about the ban have also emerged from various stakeholders, highlighting the risks of fostering a burgeoning underground market in India. Legal experts from Segev LLC remarked that while the law is presented as a progressive measure, it runs counter to global trends advocating for regulation and responsible gaming practices.
Industry trade groups, including the All India Gaming Federation and the eGaming Federation, warned that the ban could signify a "death knell" for the Indian gaming landscape. Although Indian President Droupadi Murmu has yet to finalize the legislation, her prior endorsement suggests its implementation is imminent.