Science & Technology

India’s online casual gaming segment could reach Rs 169 billion over FY21-25: KPMG

The online casual gaming segment in India had an estimated value of Rs 60 billion in FY21 and is projected to grow at a CAGR (Compound Annual Growth Rate) of 21 per cent over FY21-FY25 to reach a size of Rs 169 billion, reveals KPMG’s ‘Beyond the tipping point – A primer on Casual gaming in India‘ report.

The report also mentions that the online gaming segment in India was estimated at Rs 136 billion in FY21 and is projected to grow at a CAGR of 21 per cent over FY21-FY25 to reach a size of Rs 290 billion.

The online casual gaming sub-segment accounts for approximately 44 per cent of the total online gaming revenues. In terms of users, the online casual gaming sub-segment, at 420 million gamers in FY21 accounted for about 97 per cent of the total gamers in India and is expected to maintain this share by FY25 going ahead, adds the report.

Key growth factors

The key growth factors for the rise of the casual gaming sub-segment can amount to a number of factors. These include macro factors like increasing smartphone and internet penetration in India. As more and more people start using the internet on mobile devices like their phones and adopting digital alternatives, the gaming segment continues to reach more and more people.

The report also reveals that the COVID-19 induced lockdown in 2020 was also a tipping point in terms of online casual gaming consumption, attracting more smartphone users to games.

Challenges along the way

The report also mentions a few challenges the online gaming industry faced through 2020. The low average revenue per paying user of online casual gaming in India is about $2 amongst the world’s lowest.

This is due to the fact that India has the second-largest base of online casual gamers in the world. This is owing to the significantly lower penetration of consoles like the Sony PlayStation or the Xbox series in India, which historically have instilled a culture of paying for games.

Consumers could spend more moving forward

As Indians are gradually taking gaming more seriously and as gaming becomes accessible to a wider audience, consumer spends may go up in the years to come. The report suggests that this spends could be led by in-app purchases, that offer players more features, an ad-free experience or unlockables like skins.

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