Transcript NASSCOM IGDA - Casual Gaming in India

Casual Gaming
in India
Summary of Findings
Presentation Plan
Casual Gaming in India
Casual Gaming Industry Overview
Mobile Casual Gaming
PC Casual Gaming
Consoles and DTH Casual Gaming
The Road Ahead
Casual Gaming in India
1. Industry Overview
2. Market Drivers and Inhibitors
3. Business Models
Casual Gaming revenue to quadruple by 2015
Casual Gaming in India is at a nascent stage but is expected to
grow significantly at a CAGR of 32% over 2010-15 period
% Break-up in 2010
76%of casual gaming revenue (on an average)
will come from Mobile over 2010-15
% Break-up in 2015
… while the number of casual gamers will
increase eight times over 2010-15 period
By 2015, 12.4% of the total online
consumers will be casual gamers
By 2013, Mobile Gamers (53.4%)will outnumber the PC
% Break-up in 2010
Online Gamers (46.8%)and will form the largest segment
% Break-up in 2015
Casual Gaming in India
1. Industry Overview
2. Market Drivers and Inhibitors
3. Business Models
Four factors will be driving the Casual
Gaming Market in India
Increasing penetration of devices
 Availability of low-cost handsets will increase the
Wireless Broadband is the catalyst for
Broadband penetration
 Launch of wireless broadband networks (3G and 4G)
target market that can be addressed by the gaming
will drive internet penetration. The number of
companies
broadband users is expected to reach 285.1 million
 Increasing penetration of netbooks and tablet PCs
by 2015, sharply up from 8.65 million in 2010
will lead to higher number of people accessing
internet for online games
Aggressive Marketing by Telecom Companies
 Given the low voice ARPU, telecom companies are
Wider choice of content across multiple
platforms
 In India, all segments, namely, Consoles, Mobile,
actively promoting games to encourage their
PC/Online and DTH are being promoted and
subscribers to switch to 3G, which is in turn helping
evangelized by different stakeholders, giving
create interest in even the 2G subscriber base.
consumers multiple choices to entry
 Leading telecom companies have launched app-
 Aggregated libraries of well known international
stores offering games and application in the last one
games are available across multiple platforms –
year and a few more are in the pipeline.
mobile devices, tablet PCs, consoles etc.
… while three factors act as major growth
challenges
 Non-availability of a one-click payment
 Majority of the games available
mechanism acts as a deterrent for the sale
today are based on international
of games
themes and story-lines and invoke
 Indian consumers are not comfortable in
limited interest from Indian
using credit card for online transactions
consumers
other than air/rail ticket bookings
 Gaming companies partnership with
Telecom companies for billing is not
Ease of
Payment
Lack of
local
Content
mutually beneficial as operators retain
approx. 70% of the revenue.
 Lack of casual games based on Indian
environment, society, lifestyle and
culture inhibit the adoption in Tier-2
and Tier-3 cities
Piracy
 Piracy is a critical issue for the downloadable casual games on PCs, Consoles and Mobile devices
which heavily impacts the revenues for game development companies.
 In Indian gaming market it is reported that for every one unit of legitimate copy sold there are more than 10
pirated copies sold. Sideloading of pirated games when smartphnoes are purchased is common
Casual Gaming in India
1. Industry Overview
2. Market Drivers and Inhibitors
3. Business Models
Indian casual gaming industry going towards a
Freemium model
Business Model Adoption Trend for Mobile Casual Gaming
Present
Future
 Majority of the casual gaming companies have
 Pay-per-Use, wherein the gamers pay for the
adopted Ad supported/In-game advertising
content as they use, and Ad-supported
and Pay-per-download business models
business models are expected to be preferred
models in the near future
 Expected M-commerce laws to have an
impact in the near future
Business Model Adoption Trend for PC Casual Gaming
Present
Future
 Majority of the casual gaming companies have
 Micro-transactions, Ad-supported and
adopted Ad supported/In-game advertising
Subscription based (all you can consume)
and subscription based business models
business models are expected to be preferred
 Use of Payment gateway is the preferred
mode for transactions
models in the near future
 Cash-cards which can be purchased at retail
outlets in lieu of cash is expected to gain
traction in the near future
‘Micro-transactions’ is a well tested and
successful concept in Indian market
‘Sachet’
marketing in
FMCG and retail
segment
• ‘Micro-transactions’ as a concept has been successfully adopted by FMCG and retail companies
in India by launching most of their products in smaller packages (‘sachets’).
• The concept has high awareness among Indian consumers who have adapted to the process of
buying goods in small and incremental quantities.
• Indian consumers are highly conscious about ‘value-for-money’ and have a preference to try-out
Cashing on the
initial trial
behaviour
the products initially before becoming a regular customer.
• The micro-transactions approach allows consumers to use and feel the product before they buy
the larger quantities of the same product or service.
• A majority of Indians are in middle or lower income groups in Tier-2 and Tier-3 cities. Given the
Increasing
product
penetration in
lower income
groups
high dependence and variability in the monthly family earnings, Indians prefer to divide their
purchases in multiple smaller amounts. This is unlike western countries where people have the
preference of buying products in bulk.
• The micro-transactions concept allows the product companies to target the middle and lower
income groups and increase the product penetration.
Micro-transactions is an existing concept in India. The task ahead for Casual Gaming companies is to
identify the micro- transactable items and market them effectively to the consumers.
Mobile Casual Gamers in India
Mobile Casual Gaming Revenue expected to
grow at CAGR 27.5% over 2010-15
… however, this contribution is expected to
decrease to 60% by 2015, which can can be
Mobile Casual Gaming contributed 80%
attributed to the higher adoption of the hard
of the total gaming revenue in 2010 …
core games over casual games
Up-gradation of infrastructure (3G and LTE) leading to availability of affordable and stable
mobile internet services will be the driving factors for mobile casual gaming revenues.
Note:* The total mobile gaming revenue is based on FICCI-KPMG report
… while Mobile Casual Gamers are expected
to grow at a CAGR of 60.4%
Ratio of the total online mobile subscribers to the mobile casual gamers is
expected to increase from 10% in 2010 to 20% by 2015.
3G will overtake GPRS as the preferred technology for mobile gamers by 2015, primarily driven by
higher speed, affordable 3G-enabled handsets, and decrease in the prices of 3G services.
PC Online Casual Gamers in India
PC Online Casual Gaming Revenue expected
to grow at CAGR 29.9% over 2010-15
By 2015, 3% of the total online PC Gamers are expected to indulge in Microtransactions contributing 70% of the total PC Casual Gaming revenue
 PC Online segment will have a moderate increase in revenue in contrast to a higher increase in number of
users because of the lower ARPU, which can be attributed to the fact that games on PC are largely ad-
funded .
 Majority of the growth in the PC online casual gaming revenue will come from the increasing adoption of
net-books and tablet PCs.
… while PC Online Casual Gamers are
expected to grow at a CAGR of 41.2%
Approximately 80% of the total PC Online
Gamers in India are Casual Gamers.
 By 2015, the wired PC Online Gamers will decrease to
16% and more than 57% of gamers will use 3G network
due to the higher penetration of low cost 3G dongles.
 LTE (4G), expected to be rolled out in the country by 2012,
will further boost the shift to wireless broadband network
and will be used by 13% of the casual gamers.
Console Casual Gamers in India
Console Software Gaming Revenue expected
to grow at CAGR 79.9% over 2010-15
One of every three console games
purchased in India is a casual game.
 Number of Console Casual Gamers is expected to grow over 100% on a year-on-year basis (2010-15) which
will provide a strong platform to casual gaming companies.
 Casual gaming companies are marketing console casual games as a family activity thus expanding their reach
beyond individual gamers.
 Average price of retail boxed games is currently USD 22 and is expected to decline to USD 16.47 by 2015
Direct-To-Home (DTH) Casual Gamers in India
Direct-To-Home (DTH) – An Emerging
Segment for Casual Games
DTH segment is at a nascent stage but revenue from this segment is expected to
grow significantly at a CAGR of ~69.3% over 2010-15 period
 DTH Casual Gaming revenue was USD 0.79
million (or 1.3% of the total casual gaming
revenue) in 2010 and is expected to reach
USD 10.98 million (or 4.5 % of the total casual
gaming revenue) by 2015. However, the
changes in ARPU can impact the projected
revenues
 Telecom companies offering DTH services
such
2010
2015 E
as
Airtel
are
using
their
existing
relationships with Casual Gaming companies
and also, partnering with international gaming
companies to tap the library of the business
The Road Ahead
The Road Ahead
(1/2)
Women Centric Games
Localized Content
Current Scenario
Current Scenario
 Majority of the gamers currently are males and the
 Majority of the games available in the market are in
female segment has largely been left untapped
English language and based on international
themes.
Opportunity
Opportunity
 Higher proportion of women in India, are
 Game creators can take cues from Television,
housewives, who have spare time during day
where incorporating local language and
hours, which they utilize for entertainment
socio/cultural context by shows such as Indian
 Development of women centric games such as
based on TV-soaps – which have huge fan
Idol, Who wants to be a Millionaire, India’s Got
Talent have proved to be hugely successful.
following, will help the gaming companies to target
 Development of games in local languages, which
housewives in not just Tier-1 cities but also Tier-2
are based on demographic, cultural and social
and Tier-3 cities
topics, can positively impact the adoption and
penetration of casual games.
The Road Ahead
(2/2)
One-click Payment Mechanism
New genre of Games
Current Scenario
Current Scenario
 Gamers are uncomfortable about revealing credit
 Majority of the games are arcade or puzzle based
card details for online transactions in India
games or adventure based games in the 2D format
Opportunity
Opportunity
 Casual Gaming companies can partner with banks
 Casual gaming companies can partner with content
to enable net-banking for online transactions.
 Operators and casual gaming companies need to
agree on revenue share which is more realistic with
global averages
 Mcommerece , Google ‘s one click payment , pay
providers to develop games in different genres –
Augmented reality, edutainment, event based
games, location based etc.
 Development of games that provide near real,
interactive and engrossing experience to users.
pal are looking at Indian market to enable
This will help the gaming companies in ensuring
payments and this will have positive impact.
sustained interest of the gamers.
Leading Companies in Casual Gaming in India
IronCode
Note: The companies have been listed in alphabetical order and an Indicative List
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