Online gaming is one of the emerging industries in India. In the last two years, it has shown promising growth due to smartphone and internet reach to remote areas as well. The Digital India campaign has benefitted millions of people in terms of internet availability. Not only the internet availability, but the economical internet packages attracted millions of people. As per CNBC 2020 report, data usage per telecom subscriber has grown from ~0.4 GB per month in 2015 to ~10.4 GB per month in 2019, with a corresponding decline in the data cost over the same period.
Let’s have a look at the other factors that played a key role in online gaming emergence.
Key Factors behind Online Gaming Surge in India
Users in India changed their perception of online gaming as entertainment. Showing more trust in online payment systems helped the gaming industry to accelerate in-app purchases. Unified Payments Interface(UPI) is one of the widely accepted payment systems in India. UPI transaction value has skyrocketed from Rs 2 trillion in January 2020 to Rs 5.47 trillion in June 2021.
The card gaming industry is one of the most popular casual gaming sectors in India. Due to UPI, it recorded hefty revenue. Fantasy gaming is another sector that has taken place in recent times. MPL, Dream11, and others are successful startups of fantasy sport.
Covid-19 lockdowns and work from home helped in the adaptation of online gaming in India. The online gaming sector recorded a spike in downloads during the lockdown. Due to lockdown, a significant number of people showed interest in online games for entertainment and social connectivity. Due to the surge in time spends by the users on mobile games, the industry recorded huge revenue.
As per the KPMG India report, people spent above 4 hours in covid lockdowns on mobile devices compared with 2.5 hours before the covid-19 emergency. In June 2020, things started becoming normal and lockdown restrictions were reduced. It brought mobile usage down but surprisingly, users spent over 15% extra time compare to pre-covid time. That means, in normal scenarios as well, consumers’ habits changed to give more time to mobile devices, as reported by KPMG India.
Recent Online Gaming Deals and Future Ahead
The year 2020 saw an exponential surge in Indian online gaming in terms of investment. As per the Business Standard report, the gaming sector recorded over $544 million in funding during the August 2020-January 2021 period. As per the industry estimates, 2020 year funding is more than the investment received in the last five years before 2000.
Multi-gaming platforms attracted the majority of fundings from key players like Tiger Global, Sequoia Capital, Tencent, Softbank, and others. Startups mainly utilized these funds on technological advancement and providing uninterrupted simple user interface services to the consumers.
The real Money Gaming(RMG) industry not only expanded its operations from card-based games to online fantasy gaming but also added hypercasual gaming in its portfolio to attract more consumers. Investors also showed interest in RMG due to expansion and wider customer reach. but, the investment is not limited to big players. Small gaming firms also found investors for their pre-Series A and seed funding rounds.
As per industry experts’ analysis, the online gaming industry will further grow in the next 12-18 months due to more awareness about gaming and extraordinary user engagement. Currently, the Indian gaming industry has a huge user base of 400+ million gamers.
Despite the above positive aspects of the online gaming industry, it is also facing few issues. the low average revenue per user (ARPU) is one of them. The online gaming sector is still not getting enough revenue from the huge userbase. In India, online gamers are least interested in in-app purchases. Online gaming culture in India is yet not evolved like developed countries.
Recent Developments in Indian Online Gaming Sector
Nazara: the first IPO of Indian Gaming Firm
Nazara Technologies, founded in 2000 by gamer Nitish Mittersain, became the first Indian gaming firm to start its IPO in 2021. The company is backed by the stock market guru Rakesh Jhujhunwala. It is not only the oldest but one of the largest online gaming firms in India.
Nazara is mainly popular for cricket-related games. The firm also produced the most popular children series like Motu Patlu and Chhota Bheem. Nodwin, one of the units of Nazara, is a well-known name among International gamers. It provides online gaming events worldwide with huge popularity in 60 countries.
The company is known for its wide variety of gaming and media categories. Esports, Edutainment, infotainment, fantasy gaming, carrom are the most popular niches where Nazara is providing services.
Nazara has many subsidiaries that are popular worldwide. In 2019, the firm also bought Sportskeeda that is an emerging gaming platform. Kiddopia, CaromClash, Halaplay, and Qunami are the gaming platforms owned by Nazara.
The firm recorded a revenue of Rs 264 crore in the fiscal year 2020 that is 69% more than its revenue of Rs 183 crore in 2019. The firm is expected to record a revenue of approximately Rs 275 crore in FY2021.
Ludo King: the real king of casual gaming
Ludo King wad on a record-breaking spree during covid-19. It is a subsidiary of Gametion, founded in 2008 by Vikash Jaiswal. Ludo King became the fifth most downloaded game worldwide in April 2020 during the covid lockdown, as per the Sensor Tower report. In May 2020, it became the 6th most downloaded game May 2020.
Ludo King helped Gametion to record a revenue of $20 million in 2020. It is the most downloaded Indian game of 2020-21. Sudoku King, Carrom King is the other known game of Gametion.
In April 2021, Gametion announced on its Twitter handle that Ludo King has become the 3rd most grossing game of India.
Garena Free Fire: The Cobra is the highest-grossing game in India, whereas Lords Mobile: Kingdom Wars has secured the 2nd spot among the most grossing games in India.
Among other top 5 grossing games, Clash of Clans and Call of Duty occupy 4th and 5th place respectively
Industry experts believe that the Casual gaming sector will from 25 to 30% in 2021. By the end of 2021, the online gaming industry of India will touch a valuation of $1 billion.
Fantasy Gaming Spike in India
Dream11: the Biggest Fantasy Gaming Platform in India
Mobile Premier League, Dream11, MyTeam11, and others are the major fantasy gaming platforms.
Dream11, the oldest fantasy gaming platform in India, captures 95% market. It provides fantasy games related to football, cricket, kabaddi, hockey, etc. The online gaming giant became the IPL 2020 title sponsor and signed a 3 years collaboration with BCCI, the highest body of cricket in India.
The fantasy platform has a collaboration with ex-Indian Cricket captain MS Dhoni. Currently, 100 million users are active on the Dream11 platform in India, which is a record for any fantasy gaming firm in the Indian gaming industry.
In March 2021, the company raised a whopping $400 million in a recent funding round to reach a valuation of $5 billion. In September 2020, it concluded a $225 funding round at a valuation of $2.25 billion. Globally, it has a huge user base of 800 million gamers.
MPL: Rise Mobile Premier League Platform
Within three years of its journey, MPL has created a buzz in the fantasy gaming industry. Currently, it is the kit sponsor of Indian cricket teams: men, women, and U-19 also. The deal was finalized on November 17, 2020. MPL is also the official sponsor of IPL teams including Royal Challengers Bangalore, and Kolkata Knight Riders.
Virat Kohli, the current Indian Cricket Team captain, is the brand ambassador of MPL since 2019. MPL app has over 4 crores, active users. It raised $95 million in a Series D funding round on Feb 4, 2021. That helped the firm to reach a valuation of $945 million.
Earlier, in Series A, B, C rounds, it raised a total of $180.5 million.
The online gaming industry of India is showing exponential growth. With immense trust from global investors, it will grow with extra pace. As per Gaming, Experts believe that the coming year will be a year of engagement between industry and various stakeholders including government, consumers, and investors.
Gaming regulations are a major hurdle in front of online gaming oppo platforms. Tamil Nadu already banned some online gaming platforms involved in betting. The Karnataka government is also looking to ban such games. The gaming industry should look for solutions for such issues else growth may halt.