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Gaming spurs hardware sales

While the Indian gaming market is still nascent in comparison to its Asian counterparts there are signs that it is picking up and spurring hardware sales in the process. By Varun Aggarwal

Gaming is an endless expedition to a completely new world of imagination, which takes you away from worldly stress and discomfort, revitalizing you. In his Philosophical Investigations, Ludwig Wittgenstein demonstrated that the elements of games, such as play, rules, and competition, all fail to adequately define what games are. He subsequently argued that the concept ‘game’ could not be contained by any single definition, but that games must be looked at as a series of definitions that share a ‘familial resemblance’ to one another.

According to NASSCOM, India currently contributes a mere 0.25% to global gaming revenues with $48 million a year of sales. The growing popularity of games is set to take this market to $424 million by the end of this decade representing a CAGR of 72%. With some of the biggest gaming vendors evincing greater interest in India, we are poised to make a mark on the global scene if hiccups on the way are tackled with care.

Changing mindsets

The Indian casual gamer who is typically in the age group of 12-25 is a discerning user who has been exposed to global gaming content on the Internet.

People have starting taking up gaming as a genuine home entertainment activity and while traveling. Of course, most of this is casual gaming but, for some people, gaming has evolved from a leisure activity to a developed and competitive arena. “These Professional Gamers are like any other competitive sportsmen. Also, a socio economic shift is definitely happening in India with more disposable income and rising levels of conspicuous consumption,” said Subrotah Biswas- Country Manager- India & SAARC, Logitech.

All the gaming verticals in the industry—mobile, online, PC and console—seem to be coming together and trying to address the macro issue of gaming’s popularity in the country, by trying to promote the culture of gaming rather than trying to attract customers towards their respective offerings, he added.

“In our experience a typical gamer spends about 1-2 hours a week, is extremely brand conscious and also loyal (almost 60% of our users give us repeat visits),” said Rohit Sharma, COO, Zapak Digital Entertainment Ltd. One the key reasons that prompts Indians to play online is to compete either with their own scores or with somebody else’s in multiplayer gaming.

Multiplayer (MP) games can be segmented into casual and serious games. The casual MP genre does not require high bandwidth. It consists of turn-based games such as chess, sudoku and pool. In fact casual MP games are extremely popular Zapak.com. They generate almost 30% of the site’s traffic. Multiplayer cricket is amongst the top 3 games on Zapak.

If we look at the Serious MP genre (popularly known as MMOG i.e. Massively Multiplayer Online Games), this category does require high bandwidth, which is a bottleneck now. “This category however is also the killer application in online gaming and is going to be the biggest growth driver for the industry in India (as has been the case in China and Korea). We are investing in getting the best MMOG titles into India and also setting up dedicated gaming cafes to tackle bandwidth bottlenecks,” explained Sharma. This coupled with the growth of broadband in India over the next 2-3 years lead us to believe that the online multiplayer gaming market is poised for growth.

According to IDC, from a couple of significant active players in the Indian market in 2005, the number of Online Gaming Players has risen to at least four in 2006. Significantly, as more and more players are offering MMOG (Massively Multi-player Online Game) and MMORPG titles (Massively Multi-player Online Role-playing Game), the market now has the competition that it needs to expand in its early stages.

According to the IDC study, MMOG and MMORPG games increase the incidence of serious gamers versus casual gamers. The lives of casual games tend to be short, as gamers tend to migrate from one game to another, and from one service provider to another. There is greater stickiness in the case of MMOG and MMORPG, due to attachment to the characters and also on account of the community that develops around such games.

Market dynamics

With the advent of newer options such as mobile, console, and Net games, the Indian gaming market and its dynamics have undergone a major change.

In the past, it would take months for any international gaming title to be launched in India. Today, most games are released in India simultaneously with their global release. “Moreover the prices of titles have gone down drastically, making them more affordable than ever. This has given a great boost to the gaming industry in India,” said Diptarup Chakraborti, Principal Research Analyst- Client Computing Group, Gartner.

Sheraz Hasan, Marketing Manager, Autodesk Media and Entertainment said, “The game development market in India is also coming of age with million-polygon models, realistic textures and character animation technology being used by local game developers.” The industry is showing impressive growth but it sometimes gets bogged down by the lack of a robust, nationwide training infrastructure.

“Autodesk is lobbying with the government to play a more active role in providing the right support and infrastructure for such training in the country,” he added.

National gaming events are another big way to bring gamers together and encourage their zeal. Many such events are now regularly organized as they have got a good response from the community.

Logitech is investing on increasing the number of gamers, both competitive and casual, in India. It has sponsored the first large scale gaming expo, Logitech Skoar, in Mumbai and Bangalore. In a period of six months starting from November 2007, Logitech is participating in road shows, in mall promotions and the biggest expos with a special thrust on gaming. This includes the India Gaming Summit that it recently participated in.

The World GameMaster Tournament popularly known by its acronym WGT, is a PC gaming initiative supported primarily by ASUS. This time around, gaming hardware and chipset vendors Kingston, Razer and AGEIA have joined hands with ASUS to provide the best solutions for gamers to compete. WGT is also conducted in many countries across the world including Australia, Singapore, United Kingdom, Korea, Taiwan, Thailand, China and many more.

Who gains

In this inundated gaming market, everyone’s a winner. Vendors have started to take this market segment seriously and the result is that the market is flooded with gaming hardware for computers. “Most vendors have gaming machines in their portfolio now, but they are not finding traction at the moment. Currently the gaming specific machines are a small portion of the market,” said Chakraborti.

Chakraborti added that since the market size in the gaming segment is small at the moment, vendors are seeing the opportunity and are trying to leverage it in every possible way. “This is giving a push towards the sales of widescreen LCD monitors, RAM (most high-end games require 1 GB or higher configurations), hard disks, graphics cards and even Intel Extreme processors.”

According to Chakraborti, although most vendors have gaming machines in their portfolio, they have not been specifically designed for gaming. The market is responsive towards machines priced in the range of Rs 60,000-70,000, but barring a few machines most gaming machines are priced in the neighborhood of Rs 1 lakh.

Presently there is lack of infrastructure in terms of PCs and bandwidth for online gaming to proliferate in India. This has lead to an increasing shift towards gaming cafes that provide popular multiplayer games with a broadband connection for an ultimate gaming experience. “The response for Zapak gameplexes has been overwhelming. Presently we have 10 cafes across the country. Within two months of launch we are already witnessing 30% occupancy. This is an extremely good number especially keeping in mind the fact that these are 50 seater, large format cafes. We have also got good feedback from gamers regarding the ambiance, connectivity and content in the cafes,” added Sharma.

If we look at China and Korea, which have extremely high home broadband penetration (Korea has 99%), almost 50% gaming still takes place in cafes. This is because cafes become community hubs for the youth to play games. In fact cafes have been instrumental in popularizing the gaming industry in China and Korea. “Hence we have launched our brand “Gameplex” which are large format, high broadband, dedicated gaming cafes all across the country. Our vision is to lead the revolution of creating the gaming ecosystem in the country and we plan to have over 3,000 cafes in the next two years,” said Sharma.

With the right marketing strategy and a focused approach, vendors can maximize their earning potential in the yet nascent gaming market. However, vendors need to move fast or else they might you can just lose the game of gaming. Things are moving in the right direction but much remains to be done. One thing which could tip the scales in the favor of gaming is the availability of wireless broadband which is on the cards.

varun.aggarwal@expressindia.com