JOIN USGaming industry finds more paying customers in India
While the pandemic year gave the much needed boost to gaming market in India, the past year saw Indians more willing to pay to play. The year added 24 million Indians to the payment linked gaming market, say analysts.
In fact, Yash Srivastava, Managing Director (APAC) of the gaming platform - Coda Payments insisted , “India will move from being a player market to a payer market. This transition will be driven by micro transactions (<Rs 1,500), riding on the back an exceptionally strong digital payments infrastructure.”
The Indian gaming industry has been growing at 28-30% CAGR and is projected to grow from $2.8 billion in 2022 to $5 billion market by 2025. The number of gamers in the country is expected to swell from 420 million in 2022 to 450 million in 2023, and i hit 500 million by 2025.
Almost two-third of the Indian online gaming market revenue is from the pay-to- play format. “In India, the pay to play games constitute 75-80% of the overall industry revenue which is $2.8 billion,” said Roland Landers, CEO, All India Gaming Federation (AIGF). The Average Revenue Per Paying User (ARPPU) has gone up by 11% to $20 in India in 2022 which shows that users have shown a massive interest in spending on games, informed Manish Maryada, Co-founder and CEO, Fello, a game-based savings account.
Challenges ahead
The growing popularity has thrown the spotlight on the industry and not all the attention is to its benefit. Large scale loss of money on gaming platforms has not only turned gamers cautious, but also brought the industry under government scrutiny. “Few state governments like Telangana, Andhra Pradesh, Tamil Nadu, etc. have banned even games of skill as there is a potential possibility of a user losing money,” said Maryada,.
In Tamil Nadu, a gaming company managed to get a favourable ruling from the Madras High Court against the proposed blanket ban on games. “Banning activities is never a solution and banning will only encourage offshore gaming,” argued Asish Philip Abraham, Partner, Lakshmikumaran & Sridharan Attorneys.
The industry is, instead, open to being regulated and protected from the vagaries of government interpretations. “What we are asking for is a light touch regulation, underpinned by consumer welfare,” said Dhruv Garg, a Delhi-based lawyer practising technology law and policy, comparing the gaming industry with OTT industry in India.
Another worry is the proposed changes in the incidence of Goods and Services Tax (GST) on the industry. According to Landers, the proposed change of GST rate from 18% on Gross Gaming Revenue (GGR) to 28% on Gross Gaming Value (GGV) will have an impact of as high as 1100% on the business, and 300% on gamers.
The popular
Industry observers say the mid-core and strategy games like Free Fire, BGMI, Clash of Clans, are the most sought after games. They are convinced these “Battle Royale” games will also be the biggest drivers of 2023.
“Users are spending over 60 minutes per day on such games taking into consideration the competitive nature of the games,” said Maryada. Another category that is doing well includes casual-style games like Carroms, Candy Crush, and Ludo, that have been growing exponentially year by year.
The outlook
According to analysts, India, which was known as the “download, or eyeball market” will become a global hub for game development with high quality games being developed in the country. “The future of game development will become more content creator-led, community-lead and focussed,” said Rishi Alwani, Communications Manager and Analyst, SuperGaming. With the emergence of metaverse, games are expected to become a social platform and give e-sports a big push to drastically change user experience, said Kashyap Reddy, Co-Founder, Hitwicket, a gaming company.