Online gaming thrives due to COVID-19, industry to touch $2.8bn by 2022
Increasing usage of smartphones, cheaper data plans, rise in rural and women users, have driven the online gaming industry to grow at a compound annual growth rate (CAGR) of 40 per cent, which in turn is estimated to touch $2.8 billion by 2020, up from $ 1.1 billion in 2019.
According to a recently-released report by Deloitte India, the growth would give a boost to the sector’s share of total media and entertainment industry by 4- 5 per cent.
The report attributes the growth to the lockdown imposed due to the COVID-19 pandemic during which people logged into online gaming platforms while exploring more means of entertainment. A 21 per cent increase was seen in the time spent on gaming apps during the initial lockdown period, and the customer base crossed 300 million users.
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India, one of the top five gaming markets in the world, which accounts for 13 per cent of the global game sessions, may see a surge in real money games, e-sports and fantasy sports between 2020 and 2022, the report said. Even though the vaccination process may slowdown the average time spent on online games, it wouldn’t affect the industry’s estimate growth as it is already in an accelerated pace.
Experts say India’s gaming industry which at present is less than half of the box office collections, may soon fill this gap.
“Globally the video game industry is nearly four times the size of the box office revenues. In India the gaming industry is currently less than half of the box office collections. But now gaming industry is expected to narrow this gap. The gaming segment has attracted investments of about $450 million in the past few years and is expected to continue to attract more investments, especially from international players,” Jehil Thakkar, Partner, Deloitte India told BusinessLine.
Not only the availability of 5G network and penetration of internet has revolutionized the gaming sector in India, the monetizing opportunities that several gaming platforms offer have also been drawing factors, says Pranav Bagai CEO and co-founder of Poker Sports League in a chat with Mint.
“The forecast for the online gaming industry in India in terms of revenue is also bright. The Deloitte report suggests the same. Furthermore, the Indian gaming industry has been growing exponentially and can generate substantial revenues, create jobs, ensure responsible gaming and also curb and eliminate illegal activities, like match-fixing and money laundering, if brought under formal regulation and taxed rationally,” he says.
Gaming companies which were earlier dependent on downloads and advertisements for revenue have now diversified their ways of income by banking on consumer engagement and elevated experience levels with chargeable expansion packs, virtual coin packs and subscriptions seeing a gradual rise, the report said.
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The report pegs the investments in Indian gaming platforms in the past six years at $ 450 million. Recent investments include those in Mobile Premier League ($90 million from Pegausus Tech Ventures and others in 2020), JetSynthesys (which raised $40 million from DSG, Jetline and Triveni Engineering and Industries) and Krikey in which had an investor in Reliance Jio.