Online Gaming Industry in India earned INR 16,428 crore in FY23, future looks bright: Joydeep Mukherjee, CMO Deltatech Gaming

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In a digital era where entertainment knows no bounds, India's youthful gaming audience stands as a formidable force, reshaping trends and engagement within the online gaming industry.

With over 442 million enthusiasts, predominantly under 25 years of age, India holds the second-largest gaming user base globally, a testament to its burgeoning passion for digital entertainment.

Online Gaming Industry Continues To Grow In India

The recent FICCI-EY report titled '#Reinvent: India's media & entertainment sector is innovating for the future' reveals that game streamers experienced a viewership surge of 20% to 25%, especially in Tier-II cities.

According to the latest 'India Gaming Report 2024 - Robust Fundamentals To Power Continued Growth,' India's gaming content creation community has undergone explosive growth, boasting an impressive 300,000 creators and streamers. This vibrant community commands a captive audience of over ~600 million users

At the core of India's gaming transformation lies its vibrant youth populace, propelling remarkable growth and innovation within the industry. With an impressive 60% of gamers falling within the youthful demographic, India's gaming landscape pulsates with exuberant energy and fervour.

Mobile gaming, in particular, has emerged as the cornerstone of India's gaming culture, with the nation securing the top spot globally in mobile game downloads.

During an email exchange with myKhel, Mr Joydeep Mukherjee, Chief Marketing Officer of Deltatech Gaming, emphasised how India's youthful enthusiasm is driving the exponential growth of the online gaming industry in the country.

Consequently, there has been a significant surge in the prominence of influencers nationwide. Mr Mukherjee also noted the increasing willingness of Indian gamers to invest in in-game features, signalling a burgeoning trend. He added that despite the recent GST hike from the Centre for real-money online gaming services, the long-term growth prospects for the Indian gaming industry remain promising. Here are the excerpts:

Q: How do you perceive the impact of India's youthful gaming audience on shaping trends and engagement within the online gaming industry?

Ans: With over 442 million strong and growing, India has the second-largest gaming user base in the world, second only to China. This youthful audience, with over 60% of gamers falling under the age of 25, is a driving force propelling the Indian gaming industry towards explosive growth.

India is also the leader in mobile game downloads, having claimed the top spot globally in 2020 with 7.3 billion installs, accounting for a 17% market share. This focus on mobile accessibility makes gaming even more inclusive for the younger generation. While free-to-play games are still dominant, there's a growing trend of users embracing in-app purchases and subscriptions.

A FICCI-EY report in 2022 revealed a 39% increase in transaction-based game revenue compared to 2021, with 67% of first-time users in India opting to pay for in-game features. This indicates a growing willingness to spend amongst the player base.

This confluence of factors paints a bright picture for the Indian gaming industry. A massive and enthusiastic young audience, coupled with their increasing comfort with in-game spending, and accessibility to high-speed internet creates a perfect formula for sustained growth.

The future of Indian gaming is undeniably mobile, fueled by a young, tech-adept audience that's not afraid to spend. With this immense potential waiting to be tapped, the Indian online gaming industry is poised for a golden age of innovation and exponential growth. Gaming companies are likely to cater to these preferences by creating engaging mobile-first experiences with monetisation models tailored to this tech-savvy generation.

Q: In what ways have influencers and gamers with substantial social media followings influenced the evolution of online gaming in India?

Ans: Influencers and gamers with substantial social media following have become a significant force in the evolution of online gaming in India, acting as catalysts for growth and mainstream adoption.

First and foremost, popular influencers and gamers, already established in the digital space, act as trusted voices for brands and games. Their genuine enthusiasm and expertise can convince viewers to try a new online game or platform, fostering a sense of community and shared experience. Trust is paramount in the online gaming world, especially with new audiences.

We've collaborated with celebrities like Arjun Bijlani and Karishma Tanna, who typically appeal to both TV and OTT-watching audiences, and their presence helps us position gaming as an alternate and exciting source of entertainment. By showcasing the fun, competitive, and strategic aspects of online gaming, they break down barriers and help drive the adoption of these games.

Q: As online gaming continues to grow rapidly, how do you foresee its contribution to the Media and Entertainment (M&E) sector, both presently and in the future?

Ans: Online gaming is steadily carving out pockets of time from users that might otherwise be spent on social media, streaming platforms, OTTs, and traditional channels. The flexibility of online gaming allows for shorter, engaging bursts of entertainment that fit seamlessly into busy schedules. A quick mobile game session during a commute or a casual online match with friends becomes a preferred way to unwind.

Unlike traditional entertainment options that often require dedicated time or specific equipment, online gaming thrives on accessibility. The ubiquitous presence of smartphones and affordable internet connectivity has become a game-changer.

All you need is a mobile device and an internet connection to access a vast library of games, making online gaming truly democratic and inclusive. Additionally, online gaming goes beyond mere entertainment; it offers a captivating blend of strategy, competition, and social interaction.

Q: What was the business of the online gaming industry in the last FY? What are the projections for this fiscal year, especially after the GST hike in the online gaming sector?

Ans: Industry estimates suggest the online gaming industry in India raked in a staggering ₹16,428 crore (approximately USD 2.1 billion) in FY23. This represents a significant jump compared to previous years, highlighting the industry's rapid growth trajectory. This growth reflects the increasing popularity of online gaming amongst the Indian audience.

The recent hike in GST rates for real-money online gaming services (from 18% of gross gaming revenue to 28% of buy-in value) has introduced a degree of uncertainty. Despite the GST hike, the long-term growth prospects for the Indian online gaming industry remain positive. Factors like rising smartphone penetration, a young and tech-savvy population, and an expanding market continue to drive significant interest in online gaming.

A critical factor in maximising the industry's potential will be a balanced regulatory approach. By focusing on user experience, responsible gaming practices, and engaging with policymakers for a balanced regulatory framework, the industry can navigate this hurdle and achieve even greater heights in the coming fiscal year.