India's Mobile Gaming: Go for the Gold! (1/2)

India is among the top five markets for mobile gaming in terms of user base, driven by smartphones and the availability of cheap data. There has been a significant impetus in the mobile gaming industry in recent times, primarily due to the multitudes of workforce forced to stay indoors due to the coronavirus pandemic.

With three out of four Indian players enjoying mobile games a minimum of twice a day, the industry is poised to grow at a substantial rate over the next five years. Currently pegged at $1.2 Bn (end-2020), India's mobile gaming market is expected to reach the $1.6 Bn milestone in 2025.

With a Covid-19-triggered boost in demand, and the ban on Chinese mobile apps, Indian startups are eyeing a huge market opportunity to build and scale up.

Market Overview of Indian Mobile Gaming Industry.

• Rising adoption of smartphones and implementation of direct carrier billing have been major catalysts for the Indian mobile gaming market. Today, publishers are betting on simulation, sports and social card games to tap this opportunity. Before the outbreak of the coronavirus pandemic, India’s mobile game market had drawn plenty of attention, keeping pace with peers in terms of game development.
• Over 75% of Indians used the internet every day, with users in the 16–29-year age-bracket as their primary target audience. Over the past few years, the mobile gaming market has witnessed phenomenal growth in India, with more than 400 gaming startups, entertaining around 326 Mn mobile gamers in 2020.
• The Indian mobile gaming market is expected to reach $1.6 Bn by the end of 2025. The industry has gained momentum due to a jump in smartphone users, courtesy growing young population, rising interest in gaming and evolving ease of use.

Covid-19 Impact on Indian Mobile Gaming Startups.

• Time spent on gaming apps surged 41%
• Mobile game downloads soared in April, reaching a peak of 197 Mn in a single week — a 75% jump compared to the weekly average of previous quarter.
• Ludo King, PUBG Mobile, Clash of Clans and Teen Patti–Online Poker were some of the popular products that gained traction.
• Mobile gamers’ share increased to more than 89% Games in the arcade, casual and casino categories spiked more than 150% in terms of app usage (January-April 2020).
• Users of online gaming platform Adda52Rummy from Delhi, Kolkata and Gujarat increased.
• No. of mobile gamers using Paytm grew three-fold in March.
• Paytm Games’ Rummy gained most traction, with both the number of users and gameplays doubling every week.
• Daily active user base of Ludo King leaped from 13 Mn - 15 Mn to 50 Mn.

Mobile Gaming in India: A Timeline

India Vs the World in the Mobile Gaming Arena

• India ranks sixth in terms of size of domestic mobile gaming market.
• China enjoys a leadership position, followed by the US, Japan, South Korea and the UK.
• India ranks 111th in user penetration (2020).

Mobile Phones Remain the Primary Gaming device.

Mobile phones remain the most popular device used for playing games globally. Gaming consoles have the highest usage in the UK, with tablets being used in India more than any other country and Italy has the highest computer usage when it comes to playing games.

India Vs Others: State of Mobile Gaming

Growth In Average Annual Spent by Mobile Gamers

Value Chain Analysis

• Realignment of entities/stakeholders along with addition of multiple revenue streams has led to the development of the mobile gaming ecosystem.
• Stakeholders such as mobile operators and game publishers need to work hand in glove to boost the appeal of mobile gaming to their audiences.
• Operators in customer-facing positions will have to incorporate innovative business models to enhance the overall size of the addressable mobile gaming market and encourage more people to sample mobile games.

India’s Mobile Gaming Ecosystem

Mobile Gaming in India: Key Highlights

• In a shift from the past, Indian makers now develop games for the Indian audiences, instead of targeting western markets first, and subsequently enhancing their reach back home.
• In 2019, 5.6 Bn mobile gaming apps were downloaded in India - the highest around the globe.
• The number of mobile gamers in India is estimated to increase from 85.9 Mn in 2017 to 326.0 Mn by the end of 2020.
• Indian gaming industry’s revenue growth is pegged at 24.5% (CAGR) during 2017-2020.
• Indian developers are dominating the gaming market, with local games such as Online Rummy, Teen Patti, Ludo, Snakes, Checkers and Chess.
• Most homegrown developers are focusing heavily on the localization of games, adding unique Indianized features.
• Online games are not limited to just two but multiple players; players can win more money by playing rummy for cash at multiplayer tables, which are more popular among them.
• PUBG has boosted the Indian mobile gaming market; originally a PC game, PUBG was shifted to mobile platforms in March 2018; it crossed 50 Mn users in India by May 2019.
• Publishers have gained popularity by rolling out mobile versions of their games; PUBG Mobile, Fortnite, Asphalt Legends, Alto’s Odyssey and Call of Duty are some of the most successful names in this context.

Mobile Games Classification by Genres

Mobile Game Genre Preference - By Gender

Genre Preferences Across Age Groups - By Age Group

Puzzle, Action & Adventure Games Made to the Top 3 Preferred Genres

Total Addressable Audience

Mobile Gamers Account For 81.5% Of Overall Online Gamers In 2020

Understanding Indian Gamers' Profile

Mobile Gaming: Redefining Family Time

Gaming Takes Over TV Owned Prime Time in India.

• Prime time is no longer restricted to TV thanks to the constant evolution of media landscape and the exposure of consumers to a wide variety of touch points.
• Traditionally, it is defined as the time slot between 6 pm to midnight, characterized with highest TV viewership.
• The definition of prime time, however, also seems to be evolving, considering the highest degree of mobile gamer engagement during these hours.
• By and large being a solo activity, mobile gaming has impacted the family time in a more typical sense, which involved consumption of the same content by family members of different age groups in case of TV.

Men Vs Women: Preferred Time for Playing Mobile Games

While men mostly play mobile games any time between 6 pm and 12 am, while women prefer 9 pm to 12 am, from 9 pm to 12 am.

Similar patterns are noticeable in metros as well as other cities, indicating that prime time is the most preferred slot for playing games.

Growth Drivers in India Mobile Gaming Market

• Innovative Startups
• Creation Of Funds
• Technological Upgradation: The Rise of Artificial Intelligence, Augmented Reality and Virtual Reality
• Robust Hardware
• Rural Uptake

Issues And Challenges in India's Mobile Gaming Market

• Upgraded Technology Required
• Lack Of Skilled Manpower
• Limited Funding

Policy And Regulatory Framework for Mobile Gaming in India

• Regulation has always been an area of concern for the mobile gaming industry. Lack of clarity on regulations surrounding the gaming studios when it comes to monetizing their products is one of the common challenges in India’s online gaming market.
• Currently, the country does not have well-defined laws on online gaming, gambling and fantasy sports. Segments such as online poker, rummy and lotteries are still not governed by any dedicated law. The result is inevitable: online card games in India are also in limbo, struggling against poorly defined legal boundaries.
• Online gaming, gambling and lottery websites currently do not comply with norms on internet intermediaries under the Information Technology Act 2000. Similarly, almost all online poker websites in the country are in violation of one or more laws.

Future Outlook and Trends in Mobile Gaming Industry

With the emergence of new technologies in the market, mobile gaming has gained both popularity and growth over the past few years. Here are some key trends that are poised to drive growth of mobile gaming going forward.

• Types Of Games Users Play

Growth in the battle royale category, such as PUBG and Free Fire, is likely to lose momentum. India’s new national obsession, PUBG - if it makes a comeback - will continue amid strong competition from Free Fire, which is growing at a faster pace. On the other hand, the Indian user is still lapping up board games such as Ludo and Carrom on mobile phones. Hyper casual games will drive growth of mobile gaming in the country, and with a lot of mixing and matching of genres in the coming years.

• Matured Growth in Real Money Games

India’s fantasy gaming market, dominated by Dream11, is set to gain more maturity, as the company strategically shifts its focus to the business of sports from just gaming. The rummy market will also grow despite certain state-level legal hurdles. The sector, marked with huge margins and a high average revenue per user (ARPU), will see the emergence of new categories of games.

• Emergence Of Esports

Esports will continue to gain traction on mobile phones, with an increase both in the number of players and participation - local as well as international - in tournaments. Over the next five years, esports will continue to attract young crowds, with a larger number of global teams setting up their India operations as well as media companies foraying into the space.

• Higher Investment

The real money gaming industry is likely to receive significant investment, which is expected to continue for the coming 3-4 years. Venture capital firms Makers Fund and A16Z are focused on interactive entertainment.

• Evolution Of Cloud Gaming

With the rollout of fiber-based broadband service Jio Fiber by Reliance Jio InfoComm, there is tremendous scope for startups to experiment with their unique ideas of cloud gaming. This trend is expected to prevail in the next 10 years.

• Focus on Gamification Strategy by Popular Mobile Apps

Mobile apps such as Paytm, Phone Pe and Hotstar have started offering gaming activities to their users.

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