A recent report titled ‘Windows of Opportunity’ on the media and entertainment (M&E) landscape from Ernst & Young Global Limited in collaboration with FICCI has provided some key insights on the online gaming industry in India. As per the report, the sector grew by 35% in 2022 reaching a value of Rs 13,500 crore with the number of online gamers crossing 42.1 crore. Around 25% out of the total are paid players.
Keeping in view the current growth rate, the report estimates that the market will reach Rs 23,100 crore by 2025 at a CAGR of 20%. The increasing adoption of 5G and cloud gaming is expected to popularise the subscription-based model.
Out of the 42.1 crore gamers, around 9-10 crore are regular players, which is due to gaming influencers, access of broadband internet in Tier-II and Tier-III cities along with advertisements through several means.
Gaming revenue
Fantasy games played a huge part in boosting the gaming revenue, with many popular celebrities creating awareness through marketing campaigns as well. The top advertisers in the January-August 2022 period included Playgames 24×7, Tictok Skill Games, Galactus Funware Technology, Head Digital Works, Gameskraft Technologies, Sporta Technologies and others.
Fantasy sports saw a boost in player base due to several sports events like the FIFA World Cup, Asia Cup, the IPL and the T20 World Cup while online poker and rummy were boosted by several big tournaments with substantial prize money.
Moving on to esports, the sector also saw significant growth and with the Indian government recognizing esports as a multi-sports event last year, more sponsored teams have emerged from different places.
Regulation of online gaming sector
The sector has witnessed tremendous growth and changes in a short period of time and keeping that in mind the Ministry of Electronics and Information Technology (MeitY) recently released amendments to the IT Rules, 2021. These rules are focused on regulating the industry and safeguarding gamers.
Some of the key features of the new rules include –
Grievance redressal mechanism
Retention and storage of subscriber information
Proper KYC norms and reasonable security practices
Random number generation certificate
Future prospects of the sector
As mentioned earlier, the revenue is expected to reach Rs 23,100 crore by 2025. This includes Rs 18,300 crore from transaction-based gaming at a CAGR of 21%, while the casual gaming sector is estimated to reach Rs 4800 crore at a CAGR of 15%.
The primary growth drivers are expected to be access to high-speed internet, introduction of 5G, affordable high-end smartphones by 2025, simplified rules for online gaming and ease of digital payments et al. Furthermore, cloud gaming is slated to provide players with access to high quality games without owning expensive devices.
With more clarity on online gaming rules and regulations, more FDI is expected to come in which is likely to help with more quality content creation in the country itself. The introduction and growth of Web3 games, on the other hand, is expected to enable the play-to-earn model, allowing players to earn while playing casual games.
Snapshots of the online gamer survey –
- Over 90% of the gamers are below the age of 34.
- 47% of the people surveyed play games for fun and to relieve stress, with 45% playing for over an hour.
- More than 60% of competitive players have participated in some form of esports events.
- Most of the players (37%) wanted AR/VR tech compared to any other tech advances.
- Mobile is the most popular mode of playing games with 68% surveyed preferring it.
- Two thirds of the people surveyed have played fantasy games and around 39% were ready to pay to play real money games (RMG).
- Number of esports teams grew by 10% in 2022 compared to 2021 and by 2023 end, India is expected to have 10 international teams.