The online gaming industry witnessed a boom in 2020, and it has only been an upward ride for the sector. Investment in the gaming sector increased 108% to $443.3 million in CY2021 (Jan-Dec) as compared to $212.9 million in CY2020, as per data provided by Tracxn Technologies. With Nazara Technologies going public in 2021, the gaming sector seems to be at its prime.
According to the latest KPMG report, the online gaming industry was valued at Rs 13,600 crore in FY21 and the industry is expected to more than double within the next four years to reach a total market size of Rs 29,000 crore by FY25. The main driver of the growth has been driven by affordable Internet connectivity and rise in penetration of smartphones, it picked up speed in 2021. “The gaming industry is constantly revolutionising content, monetisation and business viability. With game tech companies at the forefront of generating wholesome immersive experiences, there is now a deeper and meaningful integration with emerging technologies. This further is coupled with culturally relevant and engaging content, which is central to creating a global benchmark emerging from India which cuts across genres and geographies across the world,” said Saumya Singh Rathore, co-founder, WinZO, told BrandWagon Online.
If last year was about cashing in on the growth and marketing the brand, this year was all about enhancing consumer experience and onboarding more users. For the duo – Anirudh Pandita and Ashwin Suresh, founders, Loco, the new investment will fuel the platform’s innovation efforts across game streaming technology and gaming content. “We have always aimed to empower novice gamers to become household names and the funding catapulted our mission to do so. Game streaming saw the entry of hundreds of thousands of new streamers and millions of viewers, and this trend should accelerate in 2022, with individual streams rivaling those of major traditional sports,” they added.
Meanwhile, NODWIN Gaming claims to have diverted its funds into three divisions. “While we continue to invest in our intellectual properties (IPs) and make them bigger and better, This year most of our funding was diverted towards acquisitions. In September, we acquired the gaming and live IP business of OML, in addition to buying a 10% stake in Rusk Media in December. Some of our funds have also been invested in improving the infrastructure that supports both organic and inorganic growth,” Sidharth Kedia, chief executive officer, NODWIN Gaming, explained.
As per Tracxn, some of the big investors were Sequoia Capital, Matrix Partners India, AngelList, Lumikai and Kalaari Capital. As for the gaming companies, MPL raised $150 million by a clutch of investors including Pegasus Tech Ventures, Sequoia Capital and Times Internet and got the unicorn status; WinZo raised $60 million in Series C funding round; NODWIN Gaming and Loco raised $22 million and $9 million, respectively.
Interestingly, 2021 opened new global avenues for the E-sports sector with the sport’s inclusion in the Tokyo Olympics 2020 and Asian Games 2022. While Tokyo Olympics 2020 was not a medaled event, the Asian Games is introducing E-sports as a medaled event, giving it legitimacy on a global level. With E-sports gaining traction now on a global level, Indian gamers– who are predominantly mobile gamers– are now shifting towards PC gaming. “We expect a small percentage of users to continue to go from smartphones to PCs, but by and large, India will continue to be a mobile-first gaming nation with a large PC playing population by absolute numbers and small in terms of percentage,” Anirudh Pandita and Ashwin Suresh, highlighted.
Despite the threat of illegitimacy looming over the sector due to bans in certain states, industry analysts have a positive sentiment of further growth in 2022. “The past year has been a year in which a lot of investors woke up to this sector. Interest in this sector has really come to life in 2021. The coming year is going to be a year of evolution for the industry as it gets organised and regulations become clearer. Investment in the sector will continue to rise along with consolidations and acquisitions. There will be a lot of activity in this sector next year,” Jehil Thakkar, partner, Deloitte India, said.