The world of mobile gaming is also buzzing with action and it is getting
bigger in the ever-growing wireless business. With saturated voice market and
dipping ARPUs, gaming has become the key element for the developers and
operators to generate new revenue streams. Mobile gaming is all set for immense
growth. It is expected to rake in $7.2 bn a year worldwide by 2011, growing from
the $2.4 bn sold in 2006, says informa.
According to Juniper Research, Asia Pacific region is expected to contribute
around 38% of the total revenues. It is pertinent that India will form a
significant part of it. The current mobile gaming business worldwide is expected
to be around $2.2 bn and India accounts for around $100 mn of the overall
market.
Trends
Gaming has emerged as a mega business for the telecom industry. The value-added
services market is seeing a 100% growth Y-O-Y and gaming is a crucial component
of this market, as it constitutes approximately 10-15% of the operator's
revenue. The Indian mobile content market is currently valued at approximately
USD 80 mn of which mobile games comprise approximately USD 4.5 mn or roughly 6%.
The market has grown approximately 75% over the last 4 years. On the other hand,
some experts peg the growth rate in MVAS much higher with the effective mobile
games revenues accounting for between $150-$200 mn. Nasscom states that mobile
gaming market is expected to touch $500 mn by 2010 in exports alone and with the
introduction of next generation phones it is all set to be the next big rage in
the country.
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According to K. Rajesh Rao, CEO, Dhruva Interactive “Mobile Gaming
constitutes a segment which has a very high degree of profitability and a very
loyal audience. There are sufficient reasons for all people in the ecosystem to
promote it.” Games are much more higher priced so considering the fact that
the ARPUs are shrinking if a customer buys even 1 game that means a considerable
addition to the average bill. According to Vishal Gondal CEO, Indiagames, “Currently
of the total subscriber base in India, only 25% handsets are data enabled. Of
these only 25% subscribe to data services while only 25% of this subscribe to
games. Hence, there is tremendous opportunity for growth.”
The mobile gaming industry has grown and attained a unique identity of its
own. The casual gaming sector is driving the mobile gaming market, as it
optimally uses the inbuilt mobile platform. More over, Indian gamer is new to
the gaming and casual games provide him a good gaming experience important to
get them hooked on to mobile gaming. This model is better suited to mobile
gaming due to its simpler learning curve, familiar concepts, and easier
acceptability. “Games are competing with other modes of entertainment. So if
they need to make a mark they have to have an experiential impact,” says Rao.
Another form of gaming getting considerable attention is the connected
multiplayer gaming. Multiplayer games for mobile using GPRS, which enables end
user to play from any location, is all set to make it big in the mobile gaming
industry. In India, although it has not yet arrived but has an immense potential
once the technology is introduced. They naturally fit with mobile devices due to
their inherent potential for communication such as buddy lists, messaging, chat
etc. According to Vishal Gupta, director (Product Technologies), Qualcomm,”
Multiplayer gaming will really pick up in India once 3G is introduced as it will
then have sufficient bandwidth for an ultimate gaming experience.” With an
improvement in handset quality and higher bandwidth support, multiplayer and 3D
games are likely to catch on in a big way.
Advergaming is another area that has immense potential in the country.
Advertisers and marketers are waking up to this potential source of reaching out
to younger audiences. Gaming in all forms has been catching up with the Indian
youth in a very big way and is expected to surpass Bollywood as the leading
source of entertainment in a few years. “Advergaming offers a targeted
opportunity in terms of reaching out to a particular kind of audience: young,
upwardly mobile, tech savvy, independent, and with a relatively high consumption
ability,” says Vishal Gondal, CEO, Indiagames.
In case of sports related games like cricket, football, or racing in game,
branding could help replicate the actual experience as seen while watching the
sport on television. Interest for branding in these types of games has been the
highest.
Roadblocks
Although mobile games are all set to rock the mobile world, it still has to
overcome a number of challenges before becoming a mass-market phenomenon. One of
the biggest challenges that the gaming market faces is easier availability of
content. Mobile gaming quality has improved significantly, but until the content
discovery and provisioning is simplified it will be tough to convince consumers
of that. The primary area that needs work is to reduce the barriers for people's
access to content. The biggest challenge is that phones in India are not
configured for GPRS automatically and that is a potential barrier, as the
average consumer is not tech savvy.
Another challenge is the availability of content to which the end user can
relate. India is an entertainment-oriented country and for a means of
entertainment to be popular acceptability is critical. In India, the most
popular mobile gaming genres are cricket, racing, and action films. Localization
of content has started happening with the aim of appealing to a wider audience.
According to Rao, ”At the end of the day the content that will make progress
is the content that finds acceptance.” The next challenge is related to the
content developers. “The biggest issue faced by developers is the current
revenue share models which vary from a 50:50 share to an 80:20 share in favor of
telecom operators,” says Vishal of Indiagames.
However, with an increase in consumer demand for quality content and
increasing licensing fees for big ticket titles, game developers would like
telecom operators to take a relook at current revenue share agreements that
would encourage higher investments in developing high-end quality content. Gupta
says, “ The bigger challenge is to fix the business model which will happen as
the market matures.” There is a need for higher revenue shares for the
developers.
On the other hand, Indian operators need to manage their mobile games portals
better, step up their marketing efforts, and introduce flexible billing for
games. In order to popularize mobile gaming, we need to discover the preferences
of the end user in paying for it. The desirable business model would be one,
which gives the end user a choice to billing model. Where as pay per download
model allows customer to experiment and explore games, subscription models do
offer consumers great value as well as increase the likelihood of higher
downloads. One could look at it as a volumes play. Higher volumes leading to
higher profitability.
The Future
According to Informa, the Asia Pacific region will continue to dominate the
mobile games market, accounting for nearly half of worldwide mobile games
revenues in 2011 and India forming a considerable part of it. The future holds
promise for real-time 3D multiplayer mobile gaming, which allows the end users
to simultaneously play a game and compete. Another form, which holds immense
future, is the cross platform gaming where a PC game can be continued on mobile.
Gupta says, “Cross platform gaming business model could be a challenge, as it
will involve large technology providers to provide common solutions to the third
party.”
With all this activity, it's observed that gaming has immense future in
India, once we get the large subscriber base.
Sonia Sharma
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