The Indian gaming industry is expected to triple to over $5 bn by 2025: Manish Agarwal

Adgully is back with a new edition of its annual feature – TRENDING NOW – where we present the strategies and views of a cross-section of industry leaders as they go about reclaiming lost time and market opportunities and build for a stronger future, armed with the lessons of the pandemic period.

Over the next few weeks, Trending Now will bring insights from industry leaders on how their organisations are gearing up to seize the opportunities in 2022, break through the Covid disruptions and find growth and remain resilient.

In conversation with Adgully, Manish Agarwal, CEO, Nazara Technologies, speaks about the tremendous growth seen by the Indian gaming industry in the last few years as well as the factors fuelling this growth, the rise of GameFi and Blockchain technology, and more.

What are the trends that you expect to dominate in your sector in 2022?

GameFi, that is, Blockchain gaming combined with decentralised finance (DeFi), will rise in the Indian market, which will open up more discussions around digital ownership and transactions within the game universe and outside of it. Blockchain technology would also address some of the core issues around trust and transparency in the online gaming industry.

2022 will also be the year of gaming content creation and gaming influencers as people become more receptive to engaging online. There would be an increased focus on facilitating gaming communities with identifiable cultural and behavioural traits as this will enable game publishers to strengthen their brand, share knowledge, and seek feedback in real-time from players. We are already witnessing social networking platforms customised for gamers blossoming in India.

With the announcement of 5G spectrum auctions this year in the Union Budget and as telecom giants are conducting 5G trials across the country, the Indian market will soon see a blitz of innovations in cloud gaming. This is going to be revolutionary in the way it will serve more players and facilitate seamless live-streaming.

What are the challenges and new opportunities that you see emerging in the year ahead?

Regulatory uncertainties loom large for the gaming industry under the absence of a uniform nation-wide law. The year 2021 saw some state governments imposing a blanket ban on all games indiscriminately, ignoring the judicial precedents set by various High Courts as well as the Supreme Court on games of skill versus chance. However, the recent announcement by the Hon’ble FM during the 2022 Budget speech on the AGVC taskforce is a welcome move to initiate a stronger dialogue on the way forward for the gaming industry.

We believe that the taskforce would provide the platform for the industry to make its case as a legitimate online business providing entertainment content and not be unfairly clubbed with unscrupulous elements active in the betting and gambling space.

On the business end for Nazara, gamified learning, esports, freemium, skill-based real money and ad tech are our growth engines, where we will focus on in FY23. Given that 2022 will be a momentous year for esports with its inclusion in the upcoming Asian Games, we anticipate massive growth and would like to have more competitive multiplayer games that lend themselves to esports.

How strong will this sector’s growth be compared to the last two years as well as the pre-Covid period?

In 2021, gaming start-ups in India attracted approximately $1.6 billion in the nine months up to September 30, 2021, exceeding the total value of investments in the sector in the past five years. India has been a beneficiary of the fact that capital inflows to China have slowed due to the stringent measures taken by the government against gaming.

The Indian gaming industry is generating $1.5 billion in revenue and is expected to triple to over $5 billion by 2025 on the back of the “mobile first” phenomenon. The industry witnessed growth of almost 40% in 2019-20, more than that of OTT, television and social media platforms. The Indian market is also expected to scale faster and become a meaningful contributor globally  with a significant spike in the number of online gamers from 360 million in 2020 to 510 million in 2022.

The capital infusion has also driven innovation and entrepreneurship. The last two years have seen game development studios going from 20 to more than 500 in number, creating games that are deeply embedded in India’s rich heritage and culture.