The year 2020 has proven to be a boon for the gaming sector. With the entire world being restricted to their homes for months, individuals rushed to adopt gaming as a mode of entertainment. Therefore, businesses from various industries enforced themselves to do expansion into the gaming sector in the form of game creation, investment, partnerships for merchandise or hosting esports tournaments and more. The COVID-19 lockdown has actually changed the game of the Indian gaming sector. Throughout the year the numbers from the sector topped the chart in the Media and Entertainment sector.
In conversation with Animationxpress, KPMG India partner and head – media and entertainment Girish Menon shared, “Online gaming is poised to be amongst the fastest-growing segments in the media and entertainment industry in India. Fantasy sports and card-based real money games witnessed strong traction in FY20. In addition, casual gaming witnessed strong uptake in consumption over the last 12-18 months. There has also been a tangible increase in in-app monetisation on casual games with users more willing to pay for entertainment. Multi-gaming platforms have also started to become more popular among users. As more users engage with games and take to gaming as a hobby or profession, there has been a surge in esports tournaments and game streaming. Gaming has started to gain acceptance as a mode of entertainment among families and proven to be a strong industry in the aftermath of the pandemic. As a result, many online video players have also started to incorporate casual games as a use case for engagement on their platform in recent times.”
Online gaming and card games
According to the recent KPMG report ‘A year off script: Time for resilience’ between the year 2016 and 2020, the gaming sector has witnessed growth in revenue at 34 per cent CAGR from Rs 28 billion to Rs 90 billion. The year 2020 has revealed various dimensions of the gaming surge and it has become the trendsetter of the ecosystem.
According to Nazara Technologies CEO Manish Agarwal, the trends that have shaped the gaming ecosystem in 2020 are as follows:
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Gaming becoming mainstream entertainment during the lockdown and lack of fresh content on TV/ OTT
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Community hangouts on social multiplayer platforms in lieu of real life social get-togethers
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Growth of esports spectators and growth of e-tournaments
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Rise of Indian companies generating revenues and building user base in the North American market
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Investor excitement in the gaming sector
With the rising interest of people towards gaming due to lack of other availability of entertainment, it has also left no option for the government to identify gaming as the high growth potential sector. Prime Minister Narendra Modi said in August that India should tap the huge potential in the digital gaming arena by developing games that are inspired from its culture and folk tales, asserting that focus should be on the use of technology and innovation besides manufacturing products that meet global standards. Adding to that the government is setting up a Centre of Excellence at IIT Bombay to promote courses in animation, visual effects, gaming and comics (AVGC), information and broadcasting minister Prakash Javadekar said while addressing the CII Summit.
Hitwicket CEO and co-founder Kashyap Reddy also added, “2020 was a phenomenal year for Mobile Gaming in India, with our hon’ble prime minister identifying gaming as a high-growth potential sector and making a clarion call to Indian Game developers to compete in AatmaNirbhar App Innovation challenge. The Challenge was a testament to the growing significance of mobile gaming as a new-age soft power in India. With 2021 around the corner, mobile gaming can be expected to sweep into people’s lives – not only as a mode of entertainment – but as social platforms for the next billion.”
According to Paytm First COO Sudhanshu Gupta the five key factors that have driven the gaming industry in 2020 are:
– Increased penetration of smartphones in India, especially in tier II and III cities, followed by the easy availability of mobile data.
– Stay at home on-demand gaming & entertainment has gained popularity in smaller cities and towns and not just a metropolitan phenomenon anymore. It has emerged as a popular mode to spend quality time with your friends and family.
– Gaining popularity of fantasy sports and esports in India.
– Availability of good quality games has also helped to exponentially drive user engagement and in turn, contribute to the growth of this industry.
– Increased focus on gaming as an industry. With big players coming in, the entire ecosystem is growing. It is more structured and has a lot to offer in terms of quality games and tournaments.
While card games including rummy and poker remained popular in non-fantasy real money gaming, there has been significant traction in the adoption of other non-fantasy real money casual games including cricket, live trivia and quiz apps. Increased adoption of multi-gaming platforms made it convenient for users to access a wide range of games on a single platform. The rise of professional gamers in India also provided a huge boost to the esports segment. According to reports gaming fared much better, with massive spikes in digital consumption during the lockdown across geographies and socio-economic classes.
A more optimistic scenario for the M&E sector is that consumers simply rebalance rather than reduce expenditure away from outdoor options such as the theatres, concerts and plays to indoor ones like OTT and gaming. The experience of COVID-19 will unquestionably exacerbate these trends, and the M&E sector is expected to contract by 20 per cent over the coming year, with digital and gaming projected to be the only segments to grow.
For the near term, gaming witnessed a spurt in consumption (except fantasy sports) and partly subscription led gaming value chain was relatively less disrupted with companies transitioning to work from home. However, in long term, the sector will increase in monetisation through in-app purchases and there will be an evolution of gaming as a means of virtual social interaction.
According to KPMG report, the M&E sector is expected to bounce back in FY22 with a growth of 33.1 per cent over FY21 to reach a size of Rs 1.86 trillion, at a CAGR of 3.2 per cent over FY20-22, with gaming and digital being the fastest growing segments.
Earlier BARC shared that gaming has seen dynamic evolution with shifts in top-ranking players and some new entrants into the top 30. LUDO KING, PUBG, Candy Crush Saga, Free Fire, Carrom Pool, MPL, PUBG Lite, Blub Smash continued to top the charts. The new entrants into the top 30 include Mini Joy Lite, Call Break, Dr. Driving, Ludo Club, Rummy Circle, Bubble Shooter, ACE 2ThreeRummy. The reason for the growth can be many, of which one of the crucial ones may be the increase in the number of internet users in India during the Covid-19 period.
Fantasy Sports
On the other side, online fantasy sports witnessed strong growth on the back of IPL in FY19, postponement of IPL and decline in live sporting events negatively impacted the platforms in the first quarter of FY20. Not just that, as soon as IPL commenced, the fantasy sports platforms bounced back and this momentum is still continuing with many international and domestic leagues across different sports making a comeback. The announcement of IPL 2020 happening has brought a wave of good cheer to the fans, users and fantasy sports operators. It has brought an increase in the viewership of the matches and with fantasy sports operators and platforms pitching in as sponsors, this shone a spotlight on the industry as a whole. The Board of Control for Cricket in India (BCCI) has awarded the title sponsorship of Indian Premier League (IPL) 2020 to Dream 11. The contract has been awarded for Rs 222 crore to the fantasy cricket league platform which is already a partner of the BCCI. This and the growing awareness at large has helped fantasy sports gain the much-needed boost during this IPL.
Fantasy Akhada founder Amit Purohit said, “With COVID-19 pandemic hitting pretty much every live major sports event to get delayed or even dropped, the fantasy sports industry boomed like never before. Sports fans have been consuming long-tail sports by utilising fantasy sports. The online fantasy sports industry was able to present a variety of mind-boggling sporting actions to sports fans in India in 2020 by introducing the newest sports and tournaments held in COVID-19 free places. The online fantasy sports platforms have offered more than 1,000 matches globally and won over five million participating users. As indicated by the industry, online fantasy sports platforms and operators cumulatively paid Rs 166 crores in GST in FY19 and Rs 445 crores in FY20.”
Purohit also shared with us that the online fantasy sports industry in 2020 has contributed to other existing businesses including online sports scoring platforms, e-commerce, online sports streaming and digital payments, content aggregators, and sports merchandise. Today, a multitude of leading brands are eyeing on online fantasy sports as a potential medium for marketing their products. Purohit added, “After a prolonged pause, the Indian Sports industry has been recuperating from the disruption of the pandemic. Even when the Indian Premier League has made a promising return in 2020, the Fantasy Sports industry is similarly back with full strength with mainstream tournaments across cricket, football, baseball etc. Online sports fan engagement platforms like fantasy sports will play a pivotal role in driving fan engagement in the near future as major sporting events will take place with a lesser crowd.”
Esports
As soon as lockdown started, all the esports events were either cancelled or postponed which massively impacted the esports industry. We all know gaming actually is an online affair and esports is the only extended way which gives it on ground sports feel where players could meet fans and the excitement is on a whole new level. So when esport events were all cancelled or postponed there has been a darkness that invaded in the competitive gaming industry. Slowly virtual matches started to commence in the form of charity tournaments and later when WHO and gaming companies started to promote the initiative #PlayApartTogether, esports industry started to see the light in the midst of darkness which led the surge in esports tournamnets both in small and large scales.
Nodwin Gaming group CEO Sidharth Kedia shared, “Lockdown laid the foundation for the rapid growth of esports in the country. Video games became the new place to socialise. If there is one thing that esports did exceptionally well – that would be – encouraging people to follow social distancing. The global campaign #PlayApartTogether is a great example. The campaign (also endorsed by WHO) ran globally and witnessed tremendous success as it was extremely well-timed. It not only served the primary purpose of social distancing among the communities but also brought them together – stronger and better! NODWIN Gaming spearheaded this campaign in India by introducing a wide variety of games to the Indian populace to stay connected and entertained in tough times.”
Gaming Content
With the rise of esports gaming, content consumption has also increased. People have started consuming gaming content as a form of entertainment. Users on platforms like TWITCH, YouTube and others have seen a surge in the DAU and MAU rates. Indian platform like Pocket Aces Loco has witnessed a 6x growth in daily active users (DAUs) in July. The viewership increase has been driven by a growth in the number of active streamers on the platform, including India’s popular streamers, who are now streaming on Loco. Monthly active streamers have increased by 122 per cent month on month during the last three months and continue to accelerate at a breakneck pace. Loco sees over 1,000+ hours of live gaming content being streamed per day and this is likely to grow further in the coming months. The platform enables users to watch and stream gameplays of different games such as PUBG Mobile, FreeFire, and Call of Duty Mobile. The platform houses some of India’s top competitive gamers such as Jonathan, Ghatak, IND Snax, and Xyaa, who, along with top teams like Fnatic, IND, 8bit, and Team Tamilas, provide viewers with the very best of gaming entertainment. Not only that with the rise of gaming content regional streams have also increased thus Loco also promoted the regional language game streaming space with regular South India-focused programming being created in association with SkyEsports and Midfail, the leading Tamil streamer, streaming on the platform.
Pocket Aces founders Anirudh Pandita and Ashwin Suresh said, “With game streaming and esports, we are witnessing the rise of a completely new category in entertainment and we are excited to serve this ecosystem through Loco. Over the past few months, we have seen consumption growing rapidly and this has been accompanied by strong positive sentiment from content creators, publishers, and advertisers. The gaming community and culture is getting stronger by the day as the sector transitions from a niche hobby to mainstream interest. We are now seeing streamers come to the fore from various walks of life and different parts of the country, entertaining audiences in their own unique way. We are really grateful for the support of various ecosystem participants and believe that we are just scratching the surface when it comes to the potential of this sector.”
For a thriving future in the Indian gaming scene, it is very important to have an ecosystem which not just fulfils the gaming content requirement but also opens up the opportunity like investments, job creation, partnerships and more.
Citing an example of how Finland’s Supercell contributed significantly to the national economy, Reddy expressed Hitwicket’s aims, “to contribute to our country’s GDP as the mobile gaming industry in India grows to create a strong and thriving gaming ecosystem. We need to build towards an ecosystem that not only caters to the entertainment needs of the people but one that creates job opportunities, nurtures homegrown talent, taps into the creative potential of our people and produces world-class content that engages not just Indian gamers, but delights gamers worldwide. Currently, a major chunk of the mobile gaming revenue generated from Indian gamers is remitted out to international developers, which in turn fuels economic growth in their nations. Given the mammoth potential of mobile gaming in India, the onus is on us to tap into the needs of Indian mobile gamers to build highly immersive experiences crafted for them. The accessibility of mobile gaming gives it the unique advantage of culminating into an inclusive platform that embraces gender diversity and transcends across socio-economic barriers. In the coming years, mobile gaming is poised for unprecedented growth in India and will open up a future with endless opportunities.”
In the coming year 2021, we can expect to witness an even brighter side of the industry with more game creation, investment and jobs.