Mobile Premier League (MPL) is set to lay off 60% of its local workers after the government banned paid games, as part of a major downsizing, according to a company source with knowledge of the plan. The Narendra Modi government banned online paid games this month, resulting in the shutdown of many online gaming apps to address financial risks and addiction among young people.
This new law has shocked the whole industry, which is backed by some of India’s top venture capital firms, such as Tiger Global and Peak XV Partners, which are expected to be worth $3.6 billion by 2029. Moreover, Dream11 and MPL have gained popularity in recent years, offering paid cricket fantasy games that enable players to win financial prizes.
The gaming industry contends that these games rely on individual skill and, therefore, should not be classified as gambling, which is already restricted in India. MPL plans to reduce its workforce by laying off 300 of its 500 employees in India. The layoffs will affect various divisions, including marketing, finance, operations, engineering, and legal. The company’s strategy focuses on free-to-play games and aims to strengthen its presence in the US market, according to a company source.
MPL CEO Sai Srinivas sent an email on Sunday, which was seen by Reuters, stating that “with a heavy heart, we have decided that we will be downsizing our India Team significantly.” However, he did not specify the exact cut of jobs in the email.
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MPL India’s revenue was roughly $100 million, while Dream11, its rival, is valued at $8 billion, according to sources. They both have stopped their cricket fantasy offerings. Similarly, many other apps for poker and rummy cards have also discontinued paid offerings.
A23, an Indian gaming company, has decided to challenge the government ban, while Dream11 and MPL have chosen not to pursue any legal actions.
