India's computer games industry is expected to grow 40% annually by 2025. The mobile phone is the most important device for gamers. Developers are increasingly attracting investors.
According to Jupiter Research analysis, there are almost 1.4 billion people and out of them are of the prime gaming age i.e between 10-30 years. Despite this, India's share of the global gaming market is just 1%. At the same time, the subcontinent is also one of the most dynamic regions in the world. Market researcher RedSeer expects annual sales growth of 30 to 40 percent for the next five years. By 2026, the Indian gaming industry is expected to generate around US$ 7 billion (US$), compared to US$ 2.2 billion in 2020. The number of computer gamers is expected to almost double to 700 million by then.
Increasing Device time of Gamers
Similar to other countries, the covid pandemic has given a boost to the gaming industry in India as well. Not only the number of users has continued to rise over the past two years, but they are also spending more and more time in front of their screens. In the financial year 2020-2021 (April 1 to March 31), the average was 3.6 hours per week, 50 percent more than before the pandemic. RedSeer predicts that this trend will continue for the next few years. India's market for computer games started to grow much later than other countries. This is mainly because traditional gaming platforms such as PCs and consoles are still not very widespread on the subcontinent.
Every tenth Indian household has a desktop, laptop, or notebook. Consoles are still a niche product and the latest generations from Sony, Microsoft and Nintendo are only available to a limited extent or, in the case of Nintendo, officially not at all. That’s why XBOX and PlayStation together have a market share of 95 percent. Above all, the higher costs for PC and console games deter users in the price-sensitive Indian market. According to an analysis by TechSci Research, the console segment accounted for 13 percent of total gaming sales in 2020 with US$ 256 million. The PC and console division is expected to grow at an average rate of 10 percent per year through 2025, RedSeer predicts.
Mobile gaming revenue is expected to reach US$5 billion
The most important device for the Indian players is the mobile phone. RedSeer estimates that since 2016, the number of smartphone owners has grown by an average of 40 percent per year to 600 million. By 2025 it will be 860 million. About 80 percent of them also use their device to play games. Again, every fifth of them spent money on games or in-app purchases in 2020. By 2025, it should be one in three. Accordingly, sales in the mobile gaming segment are developing dynamically. This could almost triple to US$ 5 billion by 2025 compared to 2021, according to the forecast by the Boston Consulting Group (BCG).
The general conditions for continued high growth dynamics in mobile gaming are very good. Not only there are many inexpensive and powerful smartphone models available on the Indian market but the costs for mobile Internet access are also among the lowest in the world. Mobile phone contracts with a monthly data volume of 50 gigabytes and more are available for the equivalent of US$ 5 per month, making online gaming via mobile phones suitable for the masses.
Expansion of the mobile Internet opens up new customer groups
The planned roll-out of the 5th generation (5G) mobile network in major cities, by the end of 2022 should bring additional impetus to the industry. At the same time, India wants to further improve the telecommunications infrastructure in rural regions, which will open up new potential customers for the gaming industry. According to RedSeer’s forecast, the number of mobile Internet users is likely to increase further by 26 percent to 882 million by 2025.
Key data on the Indian gaming industry
ForecastSource: RedSeer, Boston Consulting Group, 2022
| 2020 | 2021 | 2025 |
Revenue gaming industry as a whole (in billion US$) | 1.9 | 2.2 | 7.0 |
Revenue mobile gaming (in billion US$) | 1.5 | 1.8 | 5.0 |
Mobile gamers (in millions) | 400 | 450 | 700 |
Mobile gamers with purchases (in millions) | 80 | 96 | 234 |
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However, sales in mobile gaming will not only grow because of the increasing number of users, but also because they are likely to spend more money in the future. Compared to other countries, India is still far behind. According to the analysis by BCG, gamers spent an average of around US$ 10 in 2021, compared to US$ 66 in China, for example. With around US$ 1.2 billion, two thirds of mobile gaming sales in India last year were achieved with real money games (RMG) - digital card, casino or betting games with money stakes. Around US$ 600 million was made with in-app purchases. With mobile banking apps gaining widespread acceptance in India, digital payment for games and in-app purchases is not a major barrier for gamers.
Source: GTAI
