SUMMARY
The social media giant has become a hotbed for illegal online betting amid the IPL 2023 mania
It would be hard to miss the IPL even if you wanted to. Pretty much all ad spending and marketing by the large companies is geared towards this annual extravaganza, and nowhere is this more apparent than on Instagram.
Given this spotlight, cricket content naturally ranks high on social media algorithms in India. If you visit the Reels or Explore section on Instagram, you are likely to bump into some cricketer hawking a brand or some creator talking about the IPL.
But there’s another section of Instagram that has come to the fore amid this mania.
We are talking about online bookies and betting operations that are making the most of Instagram’s many features and the creator ecosystem to flourish this season. Our story today is a look at how these work, but after you read these important stories from our newsroom:
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- Leo Capital’s Thesis For All Seasons: Serial entrepreneur-turned VC Rajul Garg reveals how Leo Capital has stuck to its value-driven proposition for founders through all market cycles
Bookies Haunt Instagram
On a recent Instagram scrolling spree, I came across several reels involving so-called cricket books. This is just a euphemism for cricket betting operations, which are 100% illegal in India.
Inc42 came across more than 30 accounts on Instagram just by searching ‘cricket book’. A number of these accounts were clearly advertising gambling services, while others have disguised themselves as fantasy apps. Among the top results were names such as Khiladi Cricket Book, Florence Cricket Book, skyid79, and cricketviralbook.
The proliferation of betting operators and bookies on Instagram could be because anyone can create an account and dump it or change the username, says gaming and technology lawyer Jay Sayta. It’s also a ripe hunting ground for scamsters pretending to be bookies.
Betting Big On Influencers
Indian accounts of betting apps like Fairplay (150K followers), PariMatch (54K) and 1xbet (13K) have a huge following despite being banned, and even accounts that seem very suspect have thousands of followers.
For instance, ‘cricket_betting_online_book’ has 24K followers, while ‘muthuonlinebook’ has close to 45K. Similarly, Florence Book has over 52K followers on Instagram and also runs several WhatsApp and Telegram groups.
It’s unclear just how many users in India avail of these betting apps, but most of them are cashing in on the IPL 2023 mania. Sayta pointed out that these operators do not typically advertise on Instagram, but use micro and nano influencers to rope in users. And that’s where social media algorithms on Instagram and Twitter have a role to play.
“You will find a lot of influencers promoting these sites through collaboration posts and they use the influencer’s reach to get users instead of ads, so it’s not easy for authorities or the platforms to track this,” Sayta added.
Users are then led to the websites or apps that allow them to place bets with promises of large returns. But how do transactions work in this case?
How Online Betting Works
Inc42 spoke to a former bookmaker in Delhi NCR who revealed that users are urged to deposit money to a single account, which is usually in the UK or some other overseas location. These accounts are owned by ‘IDs’ which is another term used for the owner of the betting operations.
A cursory Google search will show a number of websites offering to create betting IDs for anyone who is willing to pay a fee. Whether these are legitimate betting IDs is another question. “It’s risky because you don’t know whether these IDs will work. That’s why not just anyone can start this business,” the former bookie told us.
The bookie quoted earlier told us that cricket betting is similar to margin trading where investors borrow money to buy stock, but this also means the users have to have a minimum deposit with the bookie which can go from a few thousands to lakhs of rupees. And then bookies tweak the odds to manipulate users to bet towards certain outcomes. The Instagram accounts are also at times used to show odds to the user as the odds change with every ball in a T20 match.
“Users are sent the odds through an app or website or even on WhatsApp and the bookmaker makes money on the swing of bets i.e. when users move their bets from one team to another to hedge their losses,” the former bookmaker added.
Can Regulators Crack Down On Instagram Betting?
Cricket betting itself may never go away, but a lot more can be done to keep it off social media, Sayta said. The self-regulator body is not the answer, Sayta added as self regulation is often not hard enough and this subject requires a stronger response.
When it comes to advertising on social media sites, the rules are clear. Guidelines from the Ministry of Information of Broadcasting in early April directed media companies and intermediaries such as ad networks and social media sites to refrain from carrying ads and promos for betting platforms.
But as one executive from a gaming unicorn which has fantasy cricket app told us, “The irony is we are banned in several states and when you go around on the road in these states, you will find ads for apps like FairPlay, 1Betx and others.”
Online betting and gambling have a deep societal impact, especially on the poorer sections of the population. Owing to these factors, several states have enacted regulations to bar certain games or activities that are considered gambling. Tamil Nadu has a huge problem with rummy, the executive quoted above added.
Like in Tamil Nadu, where the government notified an online gambling law that bans certain games of skill. Gaming industry body All India Gaming Federation (AIGF) has moved the Madras High Court seeking a stay on the same.
“The Tamil Nadu government has passed an unconstitutional law, which bans multiple online skill games. The law disregards over six decades of established legal jurisprudence and seems to be based on a completely wrong understanding of technology,” AIGF secretary Roland Landers told Inc42.
Even high-profile Bollywood actors, cricketers, television personalities, artists and social media influencers have been roped in for Instagram ads, and showered with sponsorship deals, despite this being barred by law. We have also come across promos in mainstream media outlets.
Sayta added that the law holds all stakeholders equally liable — not just these betting sites, but also the social media intermediaries such as Instagram, influencers and celebrities in promos. The messaging from the government is very clear but there is a lot of deficiency in the execution.
“They banned betting but these companies even sponsored large cricket tournaments in India. We want the government to come up with a gaming commission or a regulator because this is a serious issue and a lot of legitimate businesses like ours are getting caught in the middle,” added the executive from the gaming unicorn.
Startup Spotlight: GalaxEye’s Spacetech For Insurance
Spacetech is a hot sector for investors, and so far the likes of Dhruva Space, Agnikul and Pixxel have earned global recognition for their satellite launches. But Bengaluru-based GalaxEye is looking at solving problems in the financial services industry through satellite
With its satellite data and imagery, insurance providers can assess damage from natural disasters for claimants. This is likely to streamline insurance claims for both providers and users, especially as the impact of climate change worsens. As per a report, 2022 alone witnessed approximately $50 Bn-$55 Bn of global insured losses due to climate change.
Can Speciale Invest-backed GalaxEye capture a big slice of this opportunity?
Sunday Roundup: Startup Funding, Tech Stocks & More
- Funding Comes To A Crawl: The Indian startup ecosystem is going through an unprecedented funding slump. Just $41 Mn was raised by Indian startups in the past week with a mere 16 deals being reported
- ED Raids On BYJU’S: The enforcement directorate conducted search and seizure operations at premises linked to BYJU’S over potential violations of foreign exchange laws
- JioCinema Eats Hotstar’s Lunch: JioCinema has bagged the rights for HBO, Max Original and Warner Bros content in India, poaching another hot property from Disney+ Hotstar
- Nykaa’s Swing: Amid a management rejig and new competition from Reliance’s Tira, shares of Nykaa hit an all-time low this past week, before bouncing back in Friday’s trading
We’ll be back next Sunday with more. TIll then, follow us on Instagram, Twitter and LinkedIn for the latest news as it happens.
