The Indian gaming industry is estimated to clock $5 billion by 2025: BCG-Sequoia India report

The report also highlights how India is emerging as both an investment opportunity and a talent hub for the world.

The Indian gaming industry is generating $1.5 billion revenue and expected to triple to over $5 billion by 2025 on the back of the “mobile first” phenomenon, despite the industry standing at 1% of the global gaming market, according to the latest BCG-Sequoia India report. The report probes into the evolution of Indian mobile gaming in terms of genres, engagement, and monetisation dimensions. The gaming industry in India has seen a growth of almost 40% in 2019-20, more than that of OTT, television and social media platforms, Vikash Jain, managing director and senior partner, BCG, said. “86% of this market consists of mobile phone users. While there is large dependence on ad revenues today, increasing traction and engagement is expected to drive higher willingness to pay which will drive new ways of user monetisation and rising ARPUs in the coming years”, he added.

Gaming in India has been catalysed by better smartphones, increased internet access, popular titles, influencers, and the global pandemic. Titled ‘Mobile Gaming: $5B+ Market Opportunity’, the report dives deeper into this space to assess the current mobile gaming market in India, and its prospects for expansion.

The report also highlights how India is emerging as both an investment opportunity and a talent hub for the world. Monetisation of Indian games, which has been a concern in the past, is already at $1.8 billion revenues ramping very rapidly, Rajan Anandan, managing director, Sequoia India said. “The industry is witnessing a significant investor interest in Indian gaming. In fact, a third of all the funding for gaming in India came in the first quarter of 2021. The rise of gaming platforms is especially exciting, as evidenced by 80% of all funding going to platforms,” he highlighted.

The Consumer Survey conducted by BCG as part of this report, which gathered insights from over 3200 respondents across 21 locations in India to ensure comprehensiveness and representativeness, investigates the gaming habits of the Indian gamer. For Mandeep Kohli, managing director and partner, BCG, the Indian gamer is not defined by their demographic. They are rather defined by their context – their needs, preferences, and gaming habits. “An average player who plays to avoid boredom may spend around 1-2 hours on games, while a die-hard gamer who plays for the competitive spirit, can spend nearly double the time on gaming while playing the same game or a different game altogether. Companies that are able to understand these varied consumers and identify which ones are they really serving are the ones which will lead the market,” he elaborated.

For the stakeholders, the report highlights key imperatives that will drive the next wave of growth for this fast-paced industry. These include enhancing the discovery and adoption through casual and free-to-play games, improving usage and retention by diversifying genres to increase engagement and retention, and effectively driving monetisation through localised pricing strategies, among others. MPL, for example, has a genre-agnostic platform. This has led to them being popular with a wider variety of gamers, resulting in more paying users and higher retention than most others in the space.

The report also revealed that more than 80% of the mobile gaming market is driven by user spends, i.e., in-app purchases and real-money games, further catalysed by wide availability of quality smartphones, affordable internet and UPI. The report also delves deep into the strategic choices of some of the most successful mobile gaming companies in India — Nazara, MPL, Dream11 and Gameskraft. Being the first movers in their respective segments, some of these companies have helped shape the Indian gaming market. They continue to bet on new growth opportunities and build competitive advantage to stay ahead in this high-stakes game.

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