Indian gaming industry to to hit $ 300 million by 2009

NEW DELHI: The Indian gaming industry, presently estimated at $100 million, is expected to triple by 2009 with an estimate of $300 million.

This signifies a growth of 94 per cent compound annual growth rate (CAGR). Interestingly, this segment was estimated at only $30 million in 2005 and $8 million in 2003, showing a CAGR of 78%.

Of this, mobile gaming contributes 58 per cent of the total revenue and can go up to 70 per cent with increase in use of mobile phones, according to the National Association of Software and Service Companies (NASSCOM). Gaming includes consoles, online, multiplayer, casual and mobile games, according to another report by global consultancy firm KPMG.

Though still very small compared to the developed gaming markets such as the United States, Japan, Korea and China, India has a definite cost advantage since a PC game can be developed in the range of $0.5 million to $3 million as compared to $6million to $7 million in the USA.

The Indian gaming industry is also beginning to benefit from outsourcing and firms in India are now making modules of games for international companies, thus reducing their costs. These include Microsoft Corp, US-based Electronic Art Inc, UBiSoft Entertainment of France, Konami Corporation of Japan, US-based Activision Inc, and Take 2 Interactive Inc. A few components of ‘Perfect Dark Zero’, a game released by Microsoft were developed by Dhruva Interactive based in Bangalore.

According to industry sources, the ratio of revenue from services and original content development has already reached to 80:20, and is expected to improve to 60:40 in a couple of years.

Indian animation companies like DQ Entertainment Ltd, Animation Bridge, Paradox Studios, ColorChips, Toonz Animation, Hungama and Ittina Studios have entered the field which was until now monopolized by companies such as Dhruva Interactive; Indiagames Ltd, Mauj Telecom, and Mobile2Win.

These companies are also creating their own games. The success of India’s first content animated feature film ‘Hanuman’ produced by Percept Pictures and Sahara India Group has motivated game developers to look at Indian content to base their games on. Several companies like Indiagames, Paradox Studios, Fantasy Labs and Ittina Solutions have already started local content for mobiles, PCs and consoles. DQ Entertainment has planned to produce three animated feature films and also develop games around them.

Interestingly, Indian game developers are also tapping the popularity of Bollywood movies, and a game based on the super hit Hindi movie ‘Don’ was introduced recently.

Meanwhile, a recent study by IMRB International, a market research firm, on behalf of the Internet and Mobile Association of India showed that online gaming market in India has been estimated at $5 million (Rs.210 million). While 58.4% of this revenue comes from organised cyber cafes, subscriptions contribute about 31.4% and advertising brings the remaining 10.6% revenue.