The online gaming industry in India has seen a massive spurt in its growth over the last decade, an examination into the factors responsible for it is essential if one needs to understand the phenomena. India has the largest youth population in the world, with two thirds of the country falling under the age of thirty-five. It is this demographic, the early embracers of technology, that has been the major driving force behind the growth witnessed by the gaming industry. While social card games such as Rummy had been popular in the country for years, online gaming, both casual games like Clash of Clans and Temple Run, as well as games of skill, like Poker and Fantasy Sports Leagues have seen a spike in interest as a direct result of easy availability of affordable smart phones and better internet connectivity and a rise in the number of digital payment options.
If one were to ask the question- how much of an impact have these factors had on the Indian online gaming industry, one does not need to look further than a recently published report by KPMG in India and Google. According to the report, India is poised to become one of the largest emerging markets for online games. The report titled Online Gaming in India: Reaching a new pinnacle, goes on to predict that the Indian online gaming industry will add 190 million gamers and become a billion-dollar opportunity by 2021, from the $290 million that it was in 2016.
A couple of reasons can be attributed to the growth of the gaming industry in India has been has been the proliferation of affordable smartphones as well as the penetration of cheap 3G and 4G technologies in recent times. With various smartphone handset manufacturers like Samsung, Xiaomi and Lenovo concentrating on developing and introducing low cost smartphones prices under Rs 10,000, the Indian user has been exposed to the Internet like never before. With more and more mobile manufacturers like Micromax, Vivo and Oppo realizing the value of this segment, there is a growing competition for market share based on the features and retail price of the sub Rs 10,000 smartphone category.
According to a study conducted by the statistical portal www.statista.com, the number of smartphones users has grown from 238.7 million in 2015 to 340.2 million in 2017. This figure is projected to further increase to 467.9 million in 2021. India is projected to pass the United States of America in the number of smartphone users in 2017 to become the country with the highest number of smartphones users after China. Despite the increase in volume, the U.S. still has a higher smartphone than India. The smartphone penetration rate in India is on road to reach more than 28% by 2018.
A secondary factor that has undeniably contributed to the growth of the Indian gaming sector has to be the cutthroat competition witnessed in the telecom industry following the launch of Reliance Jio in September 2016. The ensuing price war between the various data providers has made high speed internet accessible and affordable to the Indian public. The drastic reduction in costs associated with high speed internet plans has provided a larger base of Indian users greater connectivity. Reliance Jio’s aggressive approach in giving free voice calls and three months of free 4G internet in the first three months of its launch has made them the fastest growing network in the country with over 100 million users joining since its launch. A result of Jio’s rapid expansion has been that competing telecom operators had to slash tariff, thus making it a win-win situation for consumer, and indirectly the gaming industry in India.
The accessibility to affordable smartphones, cheaper data plans has also made it possible for people to embrace various modes of internet and mobile banking and digital payment gateways, which in turn proved to be a bless for the online gaming sector. The gaming industry offers enormous scope for aggressive development in the next few years. It has come a long way since its nascent stages in the recent years and with better internet connectivity and greater use of digital means of payments and online transactions, India is certainly at the cusp of a massive growth in the gaming industry.
The article is contributed by Madhav Gupta, Co-founder and Partner, Baadshah Gaming