By Roland Landers
The Indian online gaming market has witnessed exponential growth over the last five years. Currently estimated at $930 million (up from $360 million in 2015), the Indian gaming industry is projected to be valued at $3.7 billion by 2024 owing to the growth of digital infrastructure as well as the improved quality and engagement of gaming content, according to a recent report by Maple Capital Advisors.
The growth of India’s gaming industry has been propelled by increased usage of smartphones and other internet-enabled devices, rising disposable income, the change in society’s attitude towards gaming and the ever-expanding young population base in the country.
A couple of years ago, the electronic and mobile gaming culture was out of reach for the majority of Indian consumers. This was primarily because of the high cost of console devices, the limited availability of affordable smartphones, and a lack of a micropayment system.
But the advent of affordable smartphones has revolutionised this sector tremendously and opened new channels for a new generation of gaming start-ups. It has also drastically improved the payment ecosystem and the constant need for new and engaging forms of digital entertainment.
Today, the online gaming industry presents the next multi-billion dollar opportunity for both startups and big companies, as more and more people turn to online games for entertainment, catalysed by the pandemic.
Globally, gaming has outperformed both the movie and music industries combined, making it the frontrunner in the entertainment industry. With the gaming industry in India reaching new heights, more opportunities have come up than ever before. It’s no surprise that due to this the industry is emerging as a lucrative space for people and an opportunity for gaming entrepreneurs to create large businesses.
As the online gaming industry continues its upward growth trajectory, marquee VCs and large corporates are too pouring their money into gaming start-ups to capitalise on the new opportunities and maximise their profits. Capital infusion enables start-ups to attract talent to the ecosystem, which helps drive innovation and entrepreneurship.
Going by the statistics, the stellar rise of online gaming makes it a very lucrative sector for investors. According to estimations, India’s gaming industry has attracted about $350 million in investments from venture capital firms between 2014 and the first few months of 2020. Moreover, gaming start-ups in India have attracted $1.6 billion in the span of nine months till 30th September 2021, exceeding the total value of investments in the sector in the past five years, according to a new report by investment banking platform Maple Capital Advisors.
Given the online gaming industry’s market size, growing user base, as well as rising investor interest which signals its strategic importance, it is imperative that India establishes a robust, well-structured, and uniform regulatory landscape to navigate existing challenges. A succinct legal and regulatory framework will not only catalyse revenue boost for the government but will also attract a boost in foreign investments for Indian game-developing studios.
Joint efforts and partnerships by the government, academia, and industry can play a pivotal role in local IP creation, and nurturing talent, thereby promoting stable growth.
The AVGC Centre for Excellence and Collaboration announced earlier in 2022, is one such joint effort by the government that has the potential to work towards attracting foreign investments and boosting local strength through skilling initiatives and the creation of job opportunities.
In the foreseeable future, growth in investments in the gaming ecosystem coupled with the adoption of emerging new-age technologies such as augmented reality (AR) virtual reality (VR) and artificial intelligence (AI); is likely to ensure that the Indian online gaming market does not just remain on track but transitions into one of the fastest growing markets internationally.
The author is the CEO of All India Gaming Federation (AIGF)