The animation and gaming industry has evolved new business models and emerged as one of the prominent growth industries. According to a report released by Nasscom and Ernst & Young, the animation and gaming industry has seen wave of changes in the past few years. The report says gaming industry is expected to grow at a CAGR of 49% to reach $830 million (Rs 4,067 crore), whereas, the animation sector is estimated to grow at CAGR of 22% to reach $1billion (Rs 4,900 crore) by 2012.
The animation sector is expected to witness 14-15% growth in the next two years. The domestic market is seeing a growth driven by VFX (visual effects) and animation education. Offshoring is expected to pick up in the animation and the gaming industry due to good quality, but the scale of delivery is coming down.
Developing animation content on television has also increased in the past one year. Creating short animated films through direct DVD market and ad films has also started seeing a place in the industry.
The growth drivers for the animation sector includes entry of global entertainment majors leading to co-production of movies, end-to-end production out of India, original IP creation and growth in the domestic market. However, the gaming industry witnessed growth in mobile and console segment, contributing to domestic consumption and the services business was propelled by enhanced partnerships with international game publishers.
Som Mittal, president, Nasscom said, ?Animation and gaming is relevant to almost most sectors now including IT, telecom and healthcare. The animation and the gaming sector in the country is lacking in areas like content generation.
The industry estimated gross revenues was $661 million in 2008, up from $364 million in 2006. However, being in a nascent stage of development, it is critical for all stakeholders to come together and create an environment that nurtures this industry for it to be able to compete at a global scale.?
According to the experts, the animation industry currently requires an additional 15,000 employees to work effectively. As per the report, the industry needs to focus on certain key issues including thrust on education and employability, simplified duty structure, IP creation and protection and global branding initiatives. This can in turn help to further build India as an animation and gaming hub.
Farokh Balsara, partner & national leader, media and entertainment practice, Ernst & Young said, ?India?s pursuit to establish itself in the global animation and gaming arena is facilitated by quality and lower cost advantage, large scale availability of manpower along with cultural and English language synergies. We believe that this combined with growing consumer demand from the domestic market would provide the required boost for the industry in India.?