‘Tax demand on e-gaming cos may top Rs 1.5 Trn’ said a news report [Bus Std 27 Sept 2023]. Another warned of ‘Gamers watch board moves with GST roll of dice’ [Bus Std 2 Oct 2023].
When did Indians get hooked to electoric or e-games?
Game consoles became a must-have item in households in the western world more than 20 years ago. The first version of Sony Play Station launched in 1994 sold 100 million units. I should admit I too got hold of a PS2 Play Station unit some fifteen years ago. I topped it with the Guitar Hero a year later. But I may have been the rare Indian consumer to have invested in e-gaming consoles. I did not have a teenager at home to play the games with and soon lost interest. In a related note the product category never did take off in India; may be high prices [console + games], inadequate promotion, patchy distribution may have contributed to the dismal performance of this category.
We Indians tend to jump across technologies. We never did adopt electronic typewriters or even the word processors. We jumped ahead to the PC era and started typing on Word, just as I am doing now.
In a similar vein I used to wonder whether Indians will ever get addicted to online games. A few things happened to facilitate this. First was the launch of Reliance Jio that made mobile internet highly affordable, even free for a few months. Then came the low-priced smart phones; you did not need a Rs 25,000 smart phone to watch videos or download games. Finally came the COVID lockdown. A report [Frontline May 8, 2023] says that Indian mobile game downloads [in billions] jumped from 1.8 in Q1 2020 to 2.7 in Q2 2020. The number of online games players crossed 433 million in FY 21 says the same report and the number will cross 650 million by FY 2025.
Not all gamers are playing for money. There are the casual gamers; you can see them in bus stops and trains. These are big revenue spinners for game companies; they pay to play a better version of the game. All mobile games have a freemium game where they entice with a free version only to move the consumer to a higher level. With the universal availability of UPI based payment interfaces, you may not even have to break your game to buy tokens and move to a higher level.
Then comes the RMG, or Real Money Games. A report said that an average player spends Rs 400 per month to play the games for around 45 minutes a day; shelling out Rs 10 to 15 rupees a day. Who are these players and when do they play?
The larger gaming companies will probably know the details to the last digit. Sensor Tower’s State of Mobile Gaming 2022 report said that 43% of Indian gamers are women [the number is 40% for South East Asia]; while mobile gaming is largely the hobby of the young, 31% of Indians [and 40% of South East Asian] gamers are over 45 years old. Yet another report in WARC June 2022 said that in the UK 79% of adults 18-34 play games at least once a week, but that drops to 28% for adults 55 years and older. Similarly, the young tend to play games through the day while the older cohorts tend to play during the traditional prime time hours.
With mobile gaming becoming such an important part of daily activity, advertising will not be far behind. The oldest form of advertising in e-gaming were the virtual billboards offered by football and racing games. Tiger Woods PGA Tour 2002 was littered with displays and product placements. This form of in-game advertising is becoming popular in India as well. In addition, brands are playing a role in the Freemium conversions: ‘watch this ad and you can continue to play for another 15 minutes’. The more adventurous brands are trying their hand at creating their own mobile games, or Gamification as it is referred to. Coca Cola had a game Sprite CPL in time for their IPL campaign and reported to have achieved 2.3 million sessions.
The challenge facing brands today is deciding where to put their money and how to get the best ROMI. Creating an engaging game is difficult. But more difficult is to get consumer to download the app and engage with it. In this regard the gaming companies in India have done the impossible in a relatively short period. They have created a new form of entertainment, largely harmless, by their aggressive promotion. Yes, Real Money Games need stronger supervision. But other types of games, especially those that can impart skills, need a different treatment. It is a slippery slope to identify the good from the bad and ugly. May be a new game is needed to help us navigate which game to let our kids play.
Appeared originally in Business Standard Oct 2023