Amid high growth, gaming Cos seek govt support & official recognition of esports

Till a few years back, gaming was mostly considered to be a pastime for children and the youth. Video game consoles and video game arcades ruled the roost. Today, gaming has turned into a $2.2 billion (in 2021) behemoth, with its market size expected to reach $7 billion in 2026 – a CAGR of 30%, as per industry reports. People from all walks and demographics play games, though the gaming population largely continues to be youth skewed. Along with the growing youth TG taking to gaming, other factors like higher disposable incomes, inexpensive internet data, introduction of new gaming genres, and increasing number of smartphone and tablet users are propelling the gaming industry to a higher growth curve.

According to Inc42, the number of internet users in India is set to surpass one billion in 2023 while the number of online gaming users in India is also projected to grow from 481 million users in 2022 to 657 million users in 2025. Today, there is easy access to smartphones from various brands, which are now available at cheaper prices to reach the masses of the Tier 2 and 3 towns.

The gaming industry is rapidly evolving in terms of technology, but it has not been able to fulfil the supply chain demand for the mass audience, which it has been accumulating. We have technologies like IoT, blockchain, high-end game engines, and tech giants manufacturing and fabricating the best gaming equipment. Although it covers 30% of the gaming market size right after console, PC, and mobile-based gaming, it falls short to acknowledge just how swiftly the demand is growing. Compared to other Asian countries India is still underdeveloped but the growing gamers in India has attracted huge interests from global video companies. There are also a few home-grown start-ups that are building their own games to be visible and compete in this market, but it is the international gaming companies that are eying the Indian market as the potential is humungous.

As investments from international video game companies continue to rise, more global studios are opening their offices in India. India is also not far behind in developing their studios the local studios are steading growing and numbers of game development studio jumped from 15 to 275 from 2009 to 2021. The rapid rate at which the industry is growing has also raised the antenna of the government machinery to bring in some rules and regulations that will control the industry to be with in the framework of rules set by the government.

The rapid digital transformation and the growth of digital media have expanded this space exponentially. It also gives a wonderful opportunity for brands to associate with the gaming space as there are many youth brands especially in the snacking and sports category who could leverage this medium and engage with the right and relevant audience. The lockdown and pandemic really pushed this industry as people wanted to kill boredom and wanted sometime for stress bursters. Now with normalcy returning everywhere how will the industry work out their strategy and maintain the momentum of the growth is something one has to watch out for. While challenges will always be there but the experts feel that the gaming industry is only moving in one direction – North.

Anurag Khurana, Founder and CEO, Penta Esports, remarked, “While the gaming industry is on an upward curve in India in terms of growth, one of the major challenges that still remain is that of perception. A large number of people still think of gaming as a frivolous activity as opposed to other modes of entertainment. While the perception is changing, we still have a long way to go.”

In terms of investments, recent trends show that many Venture Capitalists have either already invested or are looking to invest in the gaming sector as it has growth potential and has an audience comprising mostly the youth.

Continuing further, Khurana noted that since the gaming industry primarily caters to the youth, it is already a leverage point for brands looking to tap into the youth audience. Furthermore, as the industry grows, so does its reach which is a strong reason for brands to get into gaming now.”

Bharat Patel, Co-Founder and Director, Yudiz Solutions, added here that while the gaming industry is rapidly evolving with technology, it has not been able to fulfil the supply chain demand for the mass audience. According to him, it will take clever strategies that need to evolve the gaming industry on a far greater scale. “Yudiz Solutions Ltd is meeting those parallels by employing the most advanced technology and investing in manpower to merge these technologies to work productively,” he added. 

 Patel further said, “Educating new audiences and higher subscription rates are other challenges. Yudiz is participating in educating these new audiences we talk about and providing solutions in those mentioned segments we are building a community. We acknowledged the challenge and one of our core ethos is to provide cost-effective solutions at the same time utilising state-of-the-art technology expeditiously and comprehensively.” 

He further remarked that the most effective way is to introduce the audience to the pro-scene. The idea of eSports is simply amazing where one gets to showcase their gaming skills at the same time genuinely earn from it. Yudiz is also planning on introducing itself into the esports industry too. We have experience of 13+ years and learned to bank on fresh minds that bring innovative ideas to our table. The idea is to monetize those products and the pro-scene appositely so that youthful brands recognize the relevant efforts being made.

The gaming & esports industry looks bullish and will continue to be on a bull run since gaming and esports are so widely loved by the GenZ and Millennial audiences. Rohit N Jagasia, Founder and CEO, Revenant Esports, remarked “Like every industry, challenges are a part of the ecosystem, recently while esports was on the cusp of blowing up but the most loved game in India was removed from the AppStore and the PlayStore. However, I don’t believe that this will take a toll on the investments and VC interest in this space at least for organizations that are well diversified. Who expected Esports to get a prime-time slot on one of India’s Largest Sports Channels? If this was done on the basis of one game, there are many more games that have the potential to become as big if not bigger. In the PC gaming space, we have seen a great response for Valorant in terms of players and spectators.”

He further said, “I think the industry has already been pulling a lot of youthful brands. At Revenant, we are working or have worked with a wide array of even non-endemic brands. We also had two of our talents do a masterclass on mobile gaming. We have also been the first ever team in India to work with a Banking and Finance company – ICICI Securities.”

Since the beginning, India’s burgeoning gaming industry has faced difficulties. The majority of these obstacles fall under the categories of infrastructural issues, societal issues and regulatory issues. Animesh Agarwal, Founder & CEO, 8Bit Creatives, observed, “While many infrastructural problems, such as the availability of fast and dependable internet and cheaper and accessible devices are being addressed, we are still far behind. Increasing internet penetration and 5G connectivity will be pivotal. When it comes to gaming beyond mobile gaming, such as PC and console gaming, India faces significant affordability and accessibility issues. The societal construct in which we live is still not aligned with alternative career options, and families continue to have a significant say in career-related matters, so there is resistance and it is difficult to choose gaming. Obviously, the presence of gaming in mainstream media, such as the recent tournament telecast on Star Sports, as well as its inclusion in games such as the Asian Games, Commonwealth Games, etc., is causing a gradual but certain shift in mentality. We also need more government support and official recognition of esports as a sport in order to combat issues such as data privacy breaches, identity theft, and cheating.”

Speaking on the audience profile Agarwal pointed out that the Esports and gaming community’s average age ranges from 15 to 30. They have an exceptionally engaged and loyal fanbase, which is exactly what any brand wants in its target audience. The Esports industry gives youthful brands a massive reach that allows them to market their products through the appropriate channels. In short, players, teams, and content creators are the beeline to Gen Z for brands. Recently, pop culture is seen merging with Esports, which the youth find very appealing and instantly relatable.