The online gaming industry in India is worth 21 crores, according to a report published by IMRB International on behalf of the Internet and Mobile Association of India, (IAMAI). In India, as in more developed markets, school and college going youths between ages 17 and 25 are the key drivers of this segment. Although miniscule compared with such developed gaming markets as Korea, China, Japan and the US, this is a sure indicator of the commercial and social potential of the segment. Currently, most of the revenues in this segment come from organised cyber cafés (Rs. 12.17 crore) and from subscription based revenues (Rs. 6.6 crore), the contribution of advertising (Rs. 2.24 crore) which is currently low, should go up over the next 2-3 years, in line with developed gaming markets such as US where it accounts for close to 40 percent. Almost 20 percent of this revenue (Rs 4 crore) currently accrues directly to international players not based in India. It is expected that over the next 2-3 years this proportion would go down as more Indian gaming portals come up and establish their presence by providing localised content.
Currently most Indian gaming portals are on a free model and are looking at advertising revenues to sustain the first phase of growth. There are plans to introduce monthly subscriptions or subscriptions to higher levels as users become more comfortable. Most portals acknowledge that advance advertising options such as in-game placements will take some time to enter the lexicon of mainstream advertisers, most of who are just beginning to experiment with online advertising.
According to Dr. Subho Ray, President, IAMAI, there are three broad issues that could act as impediments to the progress of this segment: the negative perception of gaming, especially online gaming among parents, the poor enabling infrastructure, including connectivity and hardware constraints and the lack of recognition of the importance of this segment in increasing the penetration of Internet by the government.
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