Why India Is The Next Frontier For Video Game Companies

India, once a mainstay of software and game piracy, seems to be moving towards sustainable growth in the video gaming space. With the slow rise of many factors contributing to the explosion in the video games popularity in the subcontinent, it is quickly becoming one of the biggest untapped markets for gaming companies. As the country continues to progress towards being a digital economy, gaming companies are rushing to be the next big presence in one of the world's biggest markets. With direct investment and engagement by foreign bodies, the gaming market is progressing towards being a multi-billion dollar industry in India.

The Factors Behind The Rise Of The Gaming Industry

A variety of factors, such as affordable Internet connectivity and the penetration of smartphones has created a double-digit growth in the mobile gaming sector over the past 2 years. This allows for a huge untapped market to be formed, which is usually monetised through advertising. The subcontinent also boasts a significant digital adoption growth rate of 56%, coming second only to Indonesia among 17 other countries. According to some estimates, the industry is already worth over worth over $890 million, with India being cited as one of the top five countries for mobile gaming. These countries drive 50% of all gaming sessions in the world, with India accounting for 13%. Over 95% of games produced in India are mobile games, driving strong national sentiment and spurring downloads. A report by Frost & Sullivan predicted that the gaming market would grow from its revenue of $338 million more than 3x in the following 4 years. This would peg its revenue at about $1.1 billion in 2021, making it one of the biggest markets in the country. The number of users in the country is also projected to become 628 million around the same time frame. The rise of digital payment infrastructure also contributes to the growth of the mobile gaming industry, which can largely be attributed to the mobile-first approach taken to FinTech in the country. This has promoted the rise of revenue models such as the Free-To-Play and subscription-based 'premium' models, which allow a player to play without spending money but be able to spend money if they wish to. India as a whole has also been experiencing an increase in the disposable income that they can utilise for entertainment purposes, such as video games. Games have long been considered a luxury good, but the higher amount of disposable income has combined with easily approachable and flexible revenue models by publishers. This has created an environment where a premium gaming experience is more accessible than ever before. This has only caused an "awakening" among the population, resulting in the doubling of game downloads in India between 2014 and 2016. This environment has also prompted prominent international companies such as Alibaba, Tencent and Nvidia investing in increasing their footprint in the gaming sector.

State of Gaming In India

Chinese giant Alibaba is participating in the Indian gaming market through its backing with PayTM, who launched a gaming platform known as Gamepind in conjunction with AGTech Holdings. Indian startups have also gained prominence in the space, with names such as Nazara and Absentia making waves in the Indian mobile gaming sector. Other Chinese companies have also treated the Indian market similarly, with Tencent taking the scene by storm with the launch of PUBG Mobile and its accompanying tournaments. Similarly, Nvidia has also organised 5 'GamerConnect' events in 2018 to promote the state of the gaming market in India. This is also to grow the community of gamers in India. With the meteoric growth of the gaming market in the company, there also came a need for new media to be produced that could be consumer by avid video game enthusiasts. This caused the rise of esports in the country, making it a spectator sport for many budding gamers in the subcontinent. Companies such as U Cypher, LXG and Nodwin Gaming have been influential in creating a healthy esports market in India.

The Rise Of esports As A Spectator Sport

Out of the 15 million PC and console gamers in the country, two million are esports gamers and nearly 1000 are pro gamers in India. The rise of the Internet and the low cost of Internet services has enabled the rise of streaming platforms. These allow players to stream their games on YouTube or Twitch, with over 2 million individuals in India having grown to watching esports as a pastime. Prize pools have increased from a total of 5.6 crores in 2018, which represents an increase of 172% over last years announced prize pool of 2.06 crores. Games Dota 2 and CS:GO have doubled their prize pools to ₹1.1 crore over the same period. Tencent and Oppo have entered the market with a 50 lakh tournament for PUBG Mobile, with the market continuing to change. The rise of gaming institutes has also increased the number of individuals undergoing training for participating in esports championships. Multiple esports event organisers such as Nodwin Gaming, COBX gaming, Playtonia and LXG are fighting it out for market share. They have also begun to gain a large amount of popularity owing to the easily accessible nature of esports to the general public. These championships provide advertising opportunities for companies in the gaming space, along with targeted advertising by specific demographics. As gamers are likely to attend an esports event, it is a good idea to advertise gaming products there to maximise relevancy to their target audience. This is what makes India such a lucrative opportunity for gaming companies, as it is not only a new market in terms of hardware, but also in terms of the games themselves.