Online Gaming in India: Reaching a New Pinnacle (KPMG)

Summary

• The Indian online gaming market is valued at $290 million and is poised to grow to $1 billion by 2021.p.10
• India had 120 million online gamers in 2016 and is expected to reach about 310 million gamers by 2021.p.10
• Smartphone users are projected to reach 470 million by 2021, and internet penetration is expected to rise from 31 per cent today to about 53 per cent of the population.p.10
• 83% of online gamers are male, and nearly 60 per cent of urban mobile gamers are below 24 years.p.19
• The top 100 freemium games generated $19.65 million in revenue against $0.87 million for the top 100 paid games, which is 22 times more.p.29
• Among non-paying gamers, 30% cite the availability of free substitutes and 26% cite perceived high pricing as reasons for not paying.p.28
• About 90 per cent of online gamers use smartphones and tablets, and 85% name mobile phones as their primary device.p.25

Key insights

1. Digital payment users are set to increase to about 300 million by 2020, based on pre-demonetisation estimates.p.11
2. Indian language internet users are expected to rise to about 540 million in 2021.p.11
3. The number of local gaming service providers rose from five major companies before 2005 to about 25 companies by 2010.p.12
4. The number of Indian gaming companies reached about 250 between 2010 and 2016, and they started launching their own titles.p.13
5. More than 59 per cent of paying gamers spend on downloading and upgrading access in games, and more than 24 per cent pay by debit card.p.18
6. A heavy gamer spends 55 min/day on gaming across 11 sessions per day, and data consumption is 800 MB per month.p.20
7. Nearly 75 per cent of gamers use phones priced below INR 20,000.p.26
8. An average spend on online gaming constitutes 11 per cent of the total entertainment wallet.p.27
9. Word of mouth is the top source of game discovery at 53%, ahead of friends, family and peer group at 50%.p.30