The Smart Techie was renamed Siliconindia India Edition starting Feb 2012 to continue the nearly two decade track record of excellence of our US edition.

Indian Gaming Startups Are They Really in the Game?

Eureka Bharali
Wednesday, March 2, 2011
Eureka Bharali
The Ferrari whooshed across the Lamborghini and there comes the hit point – it’s the Jackpot - Oh yes, it’s the undying NFS, the car racing game. For some the virtual adventure is the perfect idea of gaining nirvana, and even a 10 year old’s combat skills can reign supreme in the game world. Today, gamers constitute 41.2 percent of the total Active Internet users in India, a whopping 89 percent increase from the 2007, as per a report by IAMAI. The growth has been lucrative enough to build up the confidence of the newbies, who have just entered the quasi-penetrated market.

Younger people are growing up with the Internet and online games. As they enter the workforce and continue to have greater purchasing power, the market for gaming in India will expand dramatically. “Virtual gaming is definitely big now after 2010. It is about $1 billion market in U.S. and about $8 billion worldwide. It’s huge in Asia Pacific mainly in China, Japan, S. Korea, while India is yet to gain the same speed,” says Sumit Gupta, CEO of BitRhymes. The company’s recent title called Salon Street grew to one million users in just two weeks. The Indian masters Zapak or IndiaGames are playing the game well in India. A lot of Internet users began to go beyond the regulars like Orkut, Facebook, iBiBo and BigAdda. The Virtual Worlds also known as Metaverses or Massively Multiplayer Universes have attracted a lot of attention. The most popular ones - the World of Warcraft and Second Life accounted for more than 20 million worldwide “residents”. The numbers from India, however, have not been that high, but all the same, Internet users are sitting up and noticing these. The country’s share is less than 10 percent in global animation and gaming market, which highlights immense potential of growth.

The Staggering Growth
With gaming, technological sophistication is not really a factor because games come in a host of forms, ranging from simple casual card and arcade games to sophisticated flight simulations and Flash based virtual games. Further, Gaming requires a player to pay attention, minimizing multitasking and hence the clutter, which has been bane of the traditional media for quite long. However, somewhere along the way, the companies were not able to capitalize. So, what holds Indian gamers back? There is a sheer lack of awareness about gaming and its positive aspects such as improving reflexes, mental agility and hand-eye coordination. And all, but parents still think that gaming is just a “waste of time”. Adding on to it is the low penetration of computer and broadband.

Currently, with the advent and mass adoption of Facebook in India, we see a huge surge in Indian users playing social games. But it has yet to fully mature into paying user base. “Low credit card and online banking usage makes it difficult for online companies to easily collect payments from users,” says Abhijeet Vijayakar, Founder and CEO, Nunook Interactive. The company’s product BrainNook has been designed and developed in India, and it is actively used by kids, parents and teachers in over 95 countries around the world. Over 50 schools internationally are using BrainNook to enhance their in-class teaching.

VCs’ No-buying Attitude

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