Working on a broader blueprint for real money for games: Nitish Mittersain, Nazara Technologies – Financial Times
What is the understanding of the new legal framework provided by the new rules? I mean, does that change anything for the developer at least in the online game industry? Is the definition between art and adventure really clearly delineated now?
Yes absolutely. I think what Mr Rajeev Chandrasekhar released last week under MeitY is actually a game changing strategy for the industry. I think two things happened; There is one formal government that has recognized the industry and the game and has begun to regulate how it should act. And I think it’s a long time because the industry has been in business for at least two decades. The customer is very smart. The second thing is that science-based real money gaming has been the most monetized segment of the industry. But it was surrounded a lot in the gray years and uncertain what is legal, what is not legal, what is a game of skill, what is gambling, how taxation is to be used, etc. And this prevented at least companies like ourselves from investing very aggressively in these gray areas. I think it’s very rapidly changing and the regulatory transparency that they’ve been asking us to emerge very quickly for many years. In this budget you have got clarity on online TDS which comes through recent amendments. MeitY game features have arrived for you. I think the last one on this wheel is GST and once that is also clear, I think the whole art-based gaming space is ripe for real gaming and Nazara is also moving now in this space to go very aggressively. So I think about the gospel because of the industry.
Talking about the GST, I just wanted to understand from you that the gross gambling tax is likely to remain at the Alexandrian rate of about 18%. Why is this so, because he is the same as he actually is?
So I think the best news is that it will be about the industry. But I think the more important message is really about emerging clarity. It has dragged on for a long time and now the faster part of GST has also been implemented, I think you will have a holistic clarity on the financial aspect of gaming based in India and will give a lot of growth in this industry.
It’s a skill based real money game and I know you’ve asked this over and over again, but in your company it’s a small part of what it is, what you’d like to hear clarity on this and what it was. effect on the overall revenue pie in real money?
I think as I just said, a lot of clarity has emerged, the GST part is the last cog in the wheel and from Nazara’s perspective, we are sitting on the fence. We have 5% of our revenue which is based on real game money through the open game we run. But this vehicle is a fantastic solidity and as we have always stated to make it clear, we will invest very aggressively in this area, and this will allow us to have the fastest returns in the years to come. So I think at least at the Nazarene level, you are now actively working on a larger blueprint for the real finance space, and you will certainly hear more exciting news from our end in this space in the coming months.
He also wanted to understand, how this 30% TDS or net earnings from online gaming in the user account impact you and really move things?
RMG’s current exposure doesn’t touch us much again, but I think it’s a short-term hiccup for users to get used to the new design. I think the new plan is fair enough. There was some ambiguity with the recent amendments which are also clarified so I think it is the way in the right direction because there was greater clarity and I think transparency has been achieved.
Do you see this whole art-based game ecosystem becoming big after the spotlight? It was a great start there, but then he was taking a decision. After the clarity of the decision do you think it will be normalized in the future?
No, I think you will see a big boost in growth. You will see much more interest from the investor and the good news is that many of these policies and plans also really help protect consumers, which is very important for the long-term sustainability of the business. And the last thing is that all the operators of the gray market, all the international betting companies etc. those who have a field day in India, without working restrictions, will face a lot of challenges working when these policies are firmly in place, which also means that they will have a portion of the wallet that they eat in eating. They are released for more responsible sports companies to work towards and better outputs.
