LS clears online gaming bill: Big jolt for endorsements, ad market and sports

New Delhi: The Lok Sabha has passed the Online Gaming Bill, placing curbs on real-money gaming (RMG) platforms and their promotional activities. The bill, cleared by voice vote despite opposition protests, will now move to the Rajya Sabha before heading for Presidential assent.

Pitched as a consumer protection measure, the legislation outlaws advertising and sponsorships by RMG brands across television, print, digital and influencer platforms. It also brings celebrities and influencers under direct liability if they endorse such companies.

Penalties are severe: up to two years in jail, fines up to Rs 50 lakh, or both. Repeat violations could invite three years in prison and fines as high as Rs 1 crore.

Celebrities lose a cash cow

For film stars, cricketers and influencers, RMG was one of the most lucrative categories in recent memory. From MS Dhoni’s long-running association with Dream11 to Virat Kohli’s tie-up with MPL, and a range of actors backing poker platforms, the sector had transformed endorsement economics.

That pipeline is now shut. The bill not only bans such deals but also makes endorsers legally liable. While ASCI had earlier flagged misleading claims, this law enforces penalties.

As one endorsement agent told BestMediaInfo.com: “For top cricketers, RMG endorsements brought anywhere between Rs 20–30 crore annually. Other categories are unlikely to match that scale.”

The hit will be felt equally in the influencer economy. With that stream gone, smaller creators who thrived on quick-turnaround paid content will now need to pivot to categories like fintech, e-commerce and non-RMG gaming.

The law also changes how endorsements will be signed going forward. Agents say stars will now demand tighter compliance checks before signing contracts. Talent management firms will also need to include legal vetting to shield celebrities from future risk.

For advertisers, the bill serves as a reminder of brand safety risks. Industry bodies had long warned that short-term gains from gaming could damage reputations. This new framework reinforces the importance of long-term brand custodianship.

AdEx feels the pinch

RMG’s sudden exit is expected to dent advertising expenditure (AdEx).

Industry estimates suggest gaming platforms spent Rs 1,500–2,500 crore annually, with nearly 70% of it flowing into digital. During the IPL alone, RMG accounted for 15–18% of digital ad volumes.

Digital will take the hardest hit as OTT platforms, programmatic video and social media relied heavily on RMG budgets. TV and print also impacted, as Prime-time cricket spots and festive full-page ads will now vanish.

Industry executives estimate that removing the category could shave off 5–7% of digital AdEx in the short term.

An agency leader admitted, “We’re staring at a category vacuum. FMCG, auto and e-commerce will spend this festive season, but no one will burn cash at Dream11 or MPL levels.”

For media agencies, the bill disrupts revenue projections. Many had created gaming-focused teams and platforms for influencer tie-ups. That capacity now faces realignment.

Publishers, especially OTT platforms and broadcasters who leaned on gaming spend, will also need new playbooks. Without RMG to prop up ad revenue, they may be forced to lean more on e-commerce, auto and FMCG categories—or diversify into subscription models.

Sports sponsorships staring at a void

If advertising loses money, Indian sports loses lifeblood.

RMG companies had become the most aggressive sponsors across cricket, kabaddi, football and even smaller leagues. They dominated jersey logos, title rights and digital streaming partnerships.

• Dream11 was the IPL’s title sponsor from 2020.
  
  
• My11Circle signed IPL fantasy rights worth Rs 625 crore over five years.
  
  
• Dream11 also paid Rs 358 crore as Team India sponsor.
  
  

The worry isn’t just about money vanishing; it’s the inflationary effect RMG had created. Their aggressive bidding pushed sponsorship rates up, creating benchmarks other categories may refuse to match.

“The Indian sports economy is over-indexed on RMG,” a senior sports marketer told us. “When 30–40% of sponsorship money comes from one volatile category, a ban like this exposes how fragile the system really is.”

Beyond cricket, fantasy gaming had also fuelled kabaddi, football and hockey. Those leagues now risk being starved of capital.

Esports: The government’s ‘Clean’ alternative

Interestingly, while shutting down RMG advertising, the government is backing esports. Already recognised as a sport under the Youth Affairs and Sports Ministry, esports is being projected as the next frontier for advertisers.

But can it realistically fill the RMG vacuum?

• Audience reach: Esports commands 150–200 million viewers, far short of cricket’s 500 million.
  
  
• Brand readiness: Mobile brands, telcos and FMCG are testing the waters, but durables, finance and auto are not committing big.
  
  
• Ecosystem gaps: Measurement, broadcast reach and standardisation are still weak compared to cricket.
  
  

As one esports founder put it, “Brands are experimenting, but this is trial money. Esports sponsorships will need 3–5 years to even reach 20% of what RMG was spending.”