According to a FICCI- KPMG report, the Indian media and entertainment industry is projected to grow at a CAGR (Compound Annual Growth Rate) of 12.5 per cent to reach the size of Rs 1,052 billion by 2013, while the Indian gaming industry is expected to grow at a CAGR of 33.3 per cent by 2013, which is also the highest as compared to the other forms of mediums. And with 3G rollout in India expected soon, the gaming industry will only grow at a faster pace.
Brands from sectors like FMCG, insurance, banking and telecom, are already making regular appearances in online games these days, making online gaming a lucrative medium for Indian brands whose target audiences are teenagers and youth. In-game advertising is not a new phenomenon in India, but now the volume of in-game advertisements has increased significantly.
According to Alok Kejriwal, Co-Founder and CEO, Games2win, “Gaming will contribute pretty much about 20 per cent of Internet spends in India by 2012 and is moving beyond the age group of 18-25 years to 10-80 years because there will be games for all age groups.”
Gaming is a part of the entertainment industry and what differentiates gaming from other forms of entertainment is the interactivity that it offers, an what’s more, it is also highly addictive.
How they see it
Kejriwal affirmed, “Gaming has a great future and we are very bullish about it. I believe gaming is going to be the most preferred format of interactive advertising in 2009. For us, principally the Internet is the advertising of choice during recession, and within that, gaming is content of choice. So, the medium is the Internet, but content is game.”
Salil Bhargava, CEO, Jump Games, was of the opinion that, “The Indian gaming industry currently is only beginning to take off. With mobile giving no signs of slowing down and with 3G rollout in India, the gaming industry will only see high growth in gaming. This will be the year where we will see mobile gaming, or gaming per se, growing in India, and in the next 3-4 years we will see rapid growth. The real growth will begin now.”
Naveen Tewari, CEO, mKhoj, said, “With the number of screens that mobile provides, certainly in India the gaming industry will be on mobile and that’s where gaming in terms of numbers will take place. As we go forward, we will see a lot of games that will mainly be ad funded, and it is essentially free for the consumers. The game producers make money because of the ads that they put in the games, and so I believe that both mobile and ad-funded games will see rapid growth.”
Ajay Khanna, GM, EA Games, observed, “The overall media industry is expected to grow at about 12 per cent as per FICCI estimates and the gaming industry will certainly grow double this, which is 25-30 per cent. The 3G rollout will give a big boost to online gaming in particular because it will allow the rollout of high speed broadband connections, thereby providing further boost to high-end applications such as gaming.”
Has the industry woken up to in-game advertising?
Jump Games’ Bhargava explained, “It not the gaming industry that has woken up, but the advertisers who have woken up to gaming. From the advertisers’ perspective, especially in times like this, companies will always look at better avenues to get better returns, and this is where they turn towards gaming. I think even then in-game advertising, especially from the mobile perspective, still has a long way to go.”
Games2win’s Kejriwal noted, “The gaming industry has woken up to in-game advertising, however, adver-gaming has always been there for over 10 years now. The only difference is that the volumes have increased.”
On the genre-related growth, Kejriwal said, “It is going to be pure browser based web Flash games, easy to forget, no obligations required, no commitment required, boom, boom boom…”
EA Games’ Khanna pointed out, “There has always been some form of in-game advertising in India, usually in the form of pre-arranged deals and static advertising, for instance, in Need for Speeds you always had a McDonald’s and for FIFA you’ve always had FIFA sponsors, but dynamic advertising is yet to happen in a big way because the technology is not robust enough. There is a long way to go and even globally, in-game is a small proportion of revenues.”
Gaming by 2012
According to Bhargava, “By 2012, you will see pretty significant players entering the fray. I believe this is just the beginning in in-game space, and there is a lot more to witness.”
Khanna felt, “It will grow faster than the overall media and entertainment sector in India. You will find the growth of console market, mobile and PC market.”
So, what compels users to play games? According to the industry players, it is interactive gaming that is most attractive, and over the years, the content will get more localised. With 3G rollout in India expected soon, from the mobile gaming perspective, it will lead to an increase in download speeds and migrate towards smart phones. And with speed of network always being an issue, 3G rollout would certainly help mobile gaming.
Industry players are also of the opinion that advertisers are finding gaming very positive as the younger generation is looking at new forms of entertainment compared to traditional forms, and as a result, they are all drawn towards gaming.