Study of Potential Market of online gaming in Delhi NCR
Master of Business Administration
Software Enterprise Management (Marketing)
Under the Guidance of
Internal guide : – Mr. Vivek Arya
Name : -Damini
Roll no. : – 04511809909
Centre for Development of Advanced Computing, Noida
Guru Gobind Singh Indraprastha University
Kashmere Gate, Delhi – 110006
I hereby declare that this Project Report entitled __________________________________________ submitted by me to the GGSIPU Delhi, is a bonafide work undertaken by me and it is not submitted to any other University or Institution for the award of any degree diploma / certificate or published any time before.
Name : _____________________ Signature of the Student
Enrollment No :
This is to certify that the project report (Course Code) entitled “_______________________________________________________” done by Mr. /Ms _______________________________ enrollment No_____________ is an authentic work carried out by him/her at ______________________ under my guidance. The matter embodied in this project work has not been submitted earlier for the award of any degree or diploma to the best of my knowledge and belief.
Today, the development of different online games in India is gradually picking up the market with rapidly increasing Internet cafe culture and broadband penetration. In past few years the progress in the development of web-based games in India has shown some positive escalating graph in various statistics. It has been estimated that the internet game market in India will exceed $200 million in 2010.
The aim of my project is study of potential market of online gaming in Delhi NCR. This includes the following points-
* The comparison of India online gaming to International online gaming.
* Current market scenario of online gaming. This includes the type online gaming available in India and the current market players and their share in market.
* To understand the potential customers of online gaming.
* To understand the current marketing strategies used by various players.
The data collection will be done by using secondary and primary methods. A questionnaire will be prepared to understand the potential customer and their requirement
I extend my sincere thanks to CDAC Noida for giving me this wonderful opportunity to pursue minor project in their organization. Creating a work and that too in isolation has its own pitfalls, but with great warmth and feelings i deem it my proud privilege to have undertaken the present project work under the valuable guidance of Mr. Vivek Arya (CDAC Noida) for her generous advice and kind guidance during the present study.
I cannot adequately express the appreciation, vast in deftness and the deep sense of gratitude that I feel for my most respected guide; for her ongoing interest, advise, constructive criticism and encouragement in completing this task. She has been a constant source of inspiration for us as she helped, inspired and encouraged me in polishing the project.
Also I wish to extend my heartfelt appreciation to all those people whose names may not be mentioned but their valuable support cannot be forgotten. At last I owe my indebtedness to my parents, friends, relatives and the Almighty for His precious blessings throughout the tenure of this project work.
1. OBJECTIVE ———————————————————————————-7
2. SCOPE OF STUDY —————————————————————————7
4. LITERATURE SURVEY——————————————————————-13
A. INTERNET: DRIVING THE GAMING MARKET IN INDIA —————–14
a. Internet and Broadband penetration in India
b. Internet and broad band Penetration in India
c. Internet user in India
B. GAMING ECOSYSTEM AND BUSINESS MODELS
a. Gaming Ecosystem and Business Models
C. DISTRIBUTION MODEL
D. GAMING REVENUE MODEL
E. EMERGING GAMING FORMATS
5. ANALYSIS ————————————————————————————-30
8. EXHIBIT ———————————————————– 41
A. Questionnaire for online Gamer
B. Some major online gaming companies
* The objective of the project is the study of potential market of online gaming in Delhi NCR.
* It tries to capture the potential customer for online gaming market.
* The project aims to determine the different categories of online games present in Delhi/NCR.
* The project tries to understand the present marketing strategies used for online gaming.
* The project tries to understand the potential customer for online gaming.
Indians are obsessed with entertainment and various media vehicles delivering entertainment are seeing enormous growth in the country. There have been a spate of Television channels like Real, NDTV Imagine, Colours, etc. which are broadcasting content to Indian audience. Several new newspapers and supplements have emerged. Spicy magazines with gloss covers are hounding for attention of the Indian consumers.
Not to be outdone, even the Indian Internet industry has embraced entertainment as one of the key offerings. A few years ago, Internet in India was dominated with functional content catering to news updates, reviews, classifieds, etc. However, re-packaging of the content to deliver more entertainment value is clearly visible now. The blogs have employed celebrities to give regular updates from their lives. Movie reviews and discussion related to movies appear much earlier than the actual movie hitting the silver screen.
Several Internet companies have been experimenting with gaming in the past, but with little success. Way back during start of the decade, players like Contests2Win, Hungama, etc. began with an excellent business model – of merging brand experience with gaming. And why not! Gaming offers one of the best ways to reach audiences of all ages. 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. Further, Gaming requires a player to pay attention, minimizing multitasking and hence the clutter, which has been bane of the traditional media (TV and Print) for quite long.
However, somewhere along the way, the companies were not able to capitalize the audience. Or should we say, were going slow on the innovation. or probably both, and in effect getting caught in the viscous circle of innovation and monetization. As a gaming publisher, if I am not able to monetize, I won’t have necessary resources and investments to innovate. And, if there is no innovation, monetization would be harder to come by.
A couple of years back the circle was shattered by domestic and international companies. These companies identified the right opportunity and put huge investment behind creating content and delivering it to the right audience. These gaming companies did not limit themselves to one or two genres of games and having 5-6 games in each genre. They actually made themselves present across multiple genres, with a plethora of games in each genre – offering an unprecedented choice to gamers. Zapak was one such company which burst into the scene with huge number of games developed in-house and sourced from other publishers
And the Internet community in India responded very well. The percentage of gamers amongst the Active Internet users increased from 25.3% to 41.2% at a massive growth rate of 89%.
In the social scene as well, a lot of Internet users have started to go beyond the regulars like Orkut, Facebook, iBiBo, BigAdda, etc. Virtual worlds have been in the news quite a bit in the last year. The Virtual Worlds also known as Metaverses or Massively Multiplayer Universes are attracting a lot of attention. The most popular ones are the World of Warcraft and Second Life accounting for more than 20 million worldwide “residents”. The numbers from India have not been that high, but all the same, Internet users are sitting up and noticing these. Recently, Travian, a browser-based game that enables users to play games with others has caught Indian gamers? interest. With 3 servers (3rd server launched in 29th June 2009), it has a user registered base of nearly 60,000.
The above was coupled with high profile launches of Microsoft Xbox 360 and Sony?s PS3 in India. These two brought in a new dimension to gaming altogether. The jittery gameplay and graphics gave way to movie-like story line with super cool graphics and animations. The real-life simulation games, looked less like simulation and more real life, making the game play more engrossing and captivating. However, the high-priced consoles have still not reached the Indian masses. Couple of years back Sony had lowered its PS2 prices which have seen revival since then – maybe a learning that a console needs to be lower than $100 in India.
Encouraged with the above, EA, Zapak and several other game publishers entered the Indian shores allowing for easier availability of their software. While the PC gaming industry has been plagued with piracy, there has been a tremendous growth nevertheless with correct pricing, better support and easily availability of games in various branded and non branded outlets.
The other thing going right for the Indian gaming industry is the high growth of mobile subscriptions in India. India already has more than 300 million mobile subscribers and still going strong. Most of the mobile users in India are either teens or in their early twenties, making mobiles that they own a big platform for proliferating gaming related content.
In the last few years, it has been observed that two biggest entertainment formats in India – Cricket and Cinema are keen to integrate gaming in their offering. There is unconfirmed news that IPL would feature in EA Sports? Cricket ?09 version expected to release in late 2009. The movies Hanuman and Ghajini had a presence in the gaming arena. In fact, with the Ghajini game, Eros Entertainment, a popular film distribution and marketing house has made a foray in the gaming industry as well. The gaming industry has experimented with Bollywood games in the past as well including games based on movies Dhoom, Shaheed Bhagat Singh and Agni. However, the results of these initiatives have not really been there.
All the same, the times are great for the Indian gaming industry. It has a mass of users coming the online and mobile way. The console and offline PC games are bringing in the hardcore gamers. And then with the new emerging formats Massively Multiplayer Online Games (MMOG), Social gaming (gaming on social platforms like Facebook and Orkut) and Bollywood games the gaming industry is likely to see another good year ahead. Browser-based MMOGs such as Wanted by Zapak.com are recent introductions in the Indian online gaming market.
In this report we capture details of the current scenario of the Internet and Gaming industry in India. Further we analyse the entire gaming ecosystem such as the stakeholders in this industry, types of models being used, indepth analysis of gaming platforms, types of games being played, attitudes and behaviour of gamers, etc. Additionally we point out the drivers and issues facing the industry at the moment and ways to move forward successfully. We try to analyse all the factors playing a role in this industry, how they shape the future and what makes India such a strong bet for Gaming glory in the future.
Internet: Driving the gaming market in India
Gaming in India got an impetus from Internet. With Internet, international content was available easily to Indian users. This exposed them to various gaming formats and the new titles and versions available in the market. This has definitely increased appetite of gamers in the country.
Thus, to understand the adoption and potential of online gaming it is essential to assess the overall environment for Internet usage and the penetration of PC hardware in the country. These variables have a direct impact on gaming in India. Some of the key variables that need to be understood are the total number of PCs, Internet connections, size of the Internet user base, affluence levels of users, enabling infrastructure and trends in adoption of other applications.
Internet and Broadband penetration in India
To begin with, I-Cube 2008, a syndicated research conducted by IMRB International estimated the number of PC Owning Households in the country at 7.8 Million (growth of 36% over last year). Out of these households 62% of them (4.85 Million) have subscribed to Internet. Out of these 76% are broadband subscribers while 24% are still on the dialup.
Fig: Break up of Broadband and Dial up owning homes in India
While the above scenario looks positive especially from the point of view of downloading heavy applications like gaming, the picture may not be completely rosy. TRAI defines broadband in India as 256 kbps (much lower than the global definition of 2 mbps). Further, the Indian ISPs are offering high speed Internet even at 64 kbps and 128 kbps under the garb of broadband. More so, most of the Internet connections are actually on a shared platform of DSL and Cable. Hence, even 256 kbps is the highest browsing speed that is promised. In reality a user may be getting much lesser, given that the contention ratio of various ISPs exceeds 70 in most of the cafes.
Another worrying issue from the gaming point of view is that the limited data download packs are very popular in India. Incidentally, they also happen to be the cheapest. The unlimited data download tariffs are much higher (upwards of Rs. 1500 p.m. for a 256 kbps connection). The gaming users are thus not allowed to freely experience true online gaming and in the online formats it is the simple flash games that are gaining more popularity. Some publishers like Indiagames are defying this by entering into direct agreements with various ISPs. However, there is a dire need for the ISPs to look into this issue.
Internet Users in India
I-Cube 2008 estimates put in that there are around 85 million individuals who know how to use PC. Out of these 85 million individual around 57 million individuals have ever accessed Internet (recall having accessed Internet in the past). From these, there are around 42 million Active internet users as on September 2008. An Active Internet User is defined as someone who has Internet at least once in last one month and hence are regular users of Internet.
Currently the penetration of Internet in India is still around 5% of the country?s population. However, if we consider the 300 million urban population of India, then the Internet users are a significant 20% of the population. Thus, the mass is there on the Internet. Further, the school going kids, College going and Young Men form 70% of the Internet user population in India.
Further point of interest is that Internet in India has got rather addictive with users accessing it at least 2-3 times a week. Even the number of hours accessed per week has increased from less than 7 hours per week in 2007 to almost 9.3 hours a week in 2008.
Hence the internet user audience today is young, accesses Internet more often and is spending more time on the Internet ever. This has naturally helped witness growth in many applications being accessed online, gaming being one of the frontrunners of this phenomena. The breakup of applications accessed in 2008 by demographics is depicted below:
to be developed that merge entertainment in the communication or information platforms.
A case in point here is Facebook which has very effectively integrated several applications including gaming applications in its stream. Popular ones here include Mafia Wars, Street racing, Dragon Wars, etc. Even the traditional games like scrabble, chess, etc. can be found as Facebook applications. Users can use these applications to play with their friends or connect with other users on Facebook.
Similarly, QQ a well known communication platform from the Chinese giant Tencent has quite effectively integrated gaming applications with its messenger platform. QQGame is a gaming platform that has a wide assortment of games, including basic games such as chess and poker–which are free–to more intensive games such as massive multiplayer online role playing games, which cost money. In game advertising in QQ has contributed significantly to Tencent?s revenues. QQ is not available outside China as of now, but still has 250 million user base. Interestingly, QQ?s revenues are at least three times that of Baidu, the largest search engine in China.
With such patterns, it is quite evident that online services such as portals and social networking websites could be effective avenues in attracting persistent Internet users. These users are likely to stay on and indulge in engaging applications such as online gaming. Portals and SNS can actually have a larger and more attentive audience if they are able to integrate gaming formats that their audiences are likely to relate with and like. Online gaming is an application which when integrated well with the offerings can increase the unique visitors and time spent manifold. However, it is important to understand the gamers first.
Gaming Ecosystem and Business Models
Defining the Gaming Ecosystem
The Gaming ecosystem consists of the following five main players. Each player has their own specific role to play in the development of this industry. Some of these roles and interactions are enlisted below.
Game developers: These individuals actually create the game. They design the features, program the software and test the game before actually launching it. These are the technical brains behind the game. It is these developers who help enhance features such as gameplay, sound, etc with their valuable modifications. Recently, outsourcing development work to countries like India, China, Russia and Eastern Europe has been found to be an emerging phenomenon.
Game publishers: They are the ones who promote and market online games, educate users and create awareness. These publishers can be stand alone or part of the developers as well.
Telecom and PC hardware manufacturers: These are the infrastructure providers for the industry. They design the hardware equipment with which the game is essentially played. This consists mainly of console manufacturers, mobile device makers, computer components, etc
Advertisers: These are one of the prominent revenue sources for this industry. They look to attract and appeal to the growing urban and tech savvy gamer
Cyber café owners: In a country like India with low PC penetration in homes, they play a vital role in the development of gaming in India. The cyber café owners are always on the lookout for addictive games which can attract large number of users to the café and also utilize plenty of hours making it a great revenue driver.
Distribution Model – reaching the gamers
Now that we have witnessed the players of the industry, it is time to see how the games are actually made available. The distribution model adopted plays a major role in how fast the game actually reaches the gamer. Distribution model chosen also plays a crucial role in dissuading piracy by making games more affordable and more conveniently available. The four main models used currently in India are depicted in the diagram below.
Distribution through Gaming Portals
Portals such as Zapak.com, Indiagames.com and Yahoo! generally provide the greatest possible distribution, particularly for mass market content, by showcasing the game on their service. These sites score high on advertising spots and hits offering the greatest exposure to the game. Additionally, such portals are capable of handling online technical development issues on their own.
Dedicated Online Game Site
Online gaming companies offer websites that are designed specifically for a particular game. Examples include WorldofWarcraft.com by Blizzard Entertainment, and Runescape.com from Jagex Limited. In these sites, gamers are expected to register, make their avatar or character and play games. These sites tend to generate substantial traffic, often as a result of their agreements with portals, ISPs, or other sites. Additionally, dedicated online game sites provide more targeted marketing. These sites often deliberately seek professional online users who are more likely to be interested in games.
Certain eCommerce sites sell gaming CDs/DVDs through their websites. As of now, this is not an effective avenue to distribute gaming software due to lower adoption of eCommerce services.
In this method, the game manufacturer simply stocks the game in regular shops. The gamer purchases the game in the shop and goes and plays it online using the CD/DVD purchased. This is method ranks high for convenience factor and is slowly gaining popularity now. Quite a few branded electronic retail outlets are now stocking game titles.
Other Forms of Distribution
There are certain alternative forms of distribution that are emerging in the gaming market. They have achieved some measurable success till now. The jury is still out on arriving at a concrete decision regarding their acceptance.
In case the game is linked to an event such as movies, music, etc. the distribution could be largely influenced by the offline occurrence. For example, the case of “Ghajini” game it made more sense to distribute CDs outside movie theatres itself and then expect the buyer to go play the game online. Such kind of distribution could be simply through promotions or a fee could also be charged.
Gaming Revenue Models
* Subscription based pricing model: These are a very common and popular model where the user generally pay a monthly fee that entitles them to unlimited usage during that month.
A. Time based pricing: In this type of subscription model, users pay an hourly/ monthly fee depending totally on the number of hours actually being used
B. Flat fee pricing: Here the user is charged once for downloading the game, then is allowed to play the game for free henceforth
C. Microtransactions/Item Purchase: Coupled with the above pricing, incremental revenue for gaming companies is generated in numerous ways. For example, subscription content may be combined with additional payment for special services, such as participation in an event or in-game ownership of a specific object. Also, some providers charge extra for downloading the same game to play on multiple platforms such as online and mobile.
* Advertising based pricing model: These generally rely on some sort of sponsorship or advertising. Games derive their revenue from the sponsoring company which pays for the development of the game and generally recognizes value in messaging provided by the game. Other games may be supported through general advertising; revenue is generated through sales of banner ads, interstitial advertisements, rotating sponsorships, or other types of online advertising. Within the advertising model, developers further build saleable advertising opportunities through the following:
A. In game placement: A brand is placed in a game such that it becomes an integral part of the game and creates many opportunities for the consumer to interact with it. A good example is the logo of Nike placed on the sidelines of a football match in FIFA. The advertiser pays a fee for this in-game placement.
B. On-site advertising: Internationally the most common revenue model, though not the largest source of revenue. In this model the advertiser?s pay for placing their advertisement (usually banner ads) on the website. Games are monetized by advertising units sold around the game
These days, the avid gamer is not easily satisfied with one type of content, one type of game or any kind of monotony, that?s why the great attraction to gaming.
Game developers are always on the look out for the answer to this one question- What does the hardcore gamer actually want? How to make my content applicable for all? The answer to these lies in innovation at every step of the gaming ecosystem- game design, platforms, distribution, marketing, etc. Or simply newer formats for gaming are required. Some of the most popular emerging formats have been briefly touched upon below:
Is the latest phenomenon to hit the Indian Gaming market wherein users are allowed to download the games directly using the Internet for a fee. This technique has its many advantages such as reduced distribution time from game development to final usage, lesser cost burden on end user, greater profit margin per game for developers and most importantly tries to tackle the flourishing grey market for games. Another very popular feature observed in this format is the global availability of the game for simultaneous launches in different countries becomes much easier. As per Icube downloads of games from Internet is already done by 48% of gamers which indicates this methodology has some promise for the future.
Social networking and games go hand in hand. Social gaming is a new genre of gaming which adds the “Social? factor to the games. Whether it’s taking advantage of the relationship data in social networks to build novel gameplay or building community among people who play games, game developers are discovering clever ways to build real communities around the games they’re developing. Social networking sites such as Orkut and Facebook have multiple applications and games to play for their registered users.
India too, has its very own social network for casual gamers- Nunook which allows users to play games without signing up but also provides lot of exclusive content to those who do sign up and gain sufficient points gaming. Now people can play and socialize at the same time on their already well established social networks.
Massively multiplayer online game are simply video games where thousands of players simultaneously in a virtual world.
There are a number of factors shared by most MMOGs that make them unique. Firstly they allow users to play among millions of others thus encouraging community. Secondly they allow you to continue playing from where you left off last. Thirdly they let you create a new identity or become someone else which especially appeals to those users who idolize someone. According to a leading publisher there are already around 50,000 Indians in such communities and judging by the growth rate of this format this number could well double over the next year.
Sports /Gaming tournaments
This kind of format has already become very popular in western nations with gaming championships where many gamers compete to see who is the best gamer for a selected list of games. Such competitions are recently being carried out in certain institutes across the country and are bound to increase in popularity in the near future due to the great prizes being dished out and large number of advertisers already ready to promote such events.
They are games that have been specifically designed to teach people about a certain subject, expand concepts, reinforce development, understand a historical event or culture, or assist them in learning a skill as they play. They include board and card games, and video games. These games are also quite often referred as edugames or edutainment due to their intrinsic values. Math blaster, treasure quest, reader rabbit are some examples of this type of games.
Fantasy Gaming / Real Life simulations/MMORG
These games are almost like simulation games or role playing games, multiplayer in nature and existing in a persistent virtual world. An example of one such game is stock market or share simulation games where a person gets to experience the real life scenario in a stock market. Other popular games among Indians were Cricket super selector and EPL Fantasy league where the user gets to become a manager of a team and select his own players and earn points based on their performances in matches played in real life. Players can form leagues of their own and compete among each other and against the rest of the world. Such games bring together large number of followers of the sport itself and also help all demographics play a part in the gaming experience.
The analysis will determine the potential customer based on the several factors that will include the demographic factors like sex, age, occupation and the choice of games and money they spend on these games.
The data collected by various articles by iamai and other organization.. The journals and some books are used for the data collection purpose.
A questionnaire is a research instrument consisting of a series of questions and other prompts for the purpose of gathering information from respondents. Although they are often designed for statistical analysis of the responses, this is not always the case. Questionnaires have advantages over some other types of surveys in that they are cheap, do not require as much effort from the questioner as verbal or telephone surveys, and often have standardized answers that make it simple to compile data. However, such standardized answers may frustrate users. Questionnaires are also sharply limited by the fact that respondents must be able to read the questions and respond to them.
A questionnaire for the online gamers is designed. This questionnaire tries to capture the potential customer and this tries to cover all the factors .In this it tries to understand the type of games prefer by these games and the source they like to use for playing like gaming portals etc.
This questionnaire will help to determine the likes of the gamer and will therefore help the gaming organization to focus on those particular areas.
Scope of the Questionnaire
* To understand the type of online games usually preferred .
* Which age group prefer which game .
* The most commonly used distribution model for playing online games.
This covers the online gamers in India.
A random sample of 100 online gamer is selected .
Convenience sampling (sometimes known as grab or opportunity sampling) is a type of non-probability sampling which involves the sample being drawn from that part of the population which is close to hand. That is, a sample population selected because it is readily available and convenient. It may be through meeting the person or including a person in the sample when one meets them or chosen by finding them through technological means such as the internet or through phone. The researcher using such a sample cannot scientifically make generalizations about the total population from this sample because it would not be representative enough.
* The mode of Primary Data collection will be Questionnaire. The Questionnaire has a Limitation where the responses from the respondent may be ambiguous and inaccurate. Other factors include time for the research and psychological factors. Other factors include time for the research and psychological factors.
* The sample population size and the geographical area in which the study is conducted is too small to reach a generalized conclusion.
Percentage analysis is used for research analysis.
Demographics based on Survey
The survey shows that the majority of the gamers in India are man i.e. 70 percent of the online gamer are men.They generally belong to a young age group of 10 to 25 years. The majority of these men and women are either working or student.
The survey shows that casual games are generally the most preferred online game. But MMOG’s also have huge share. The survey shows that
• The majority of online gamers are between the age group of 10 to 25 years.
• Casual gaming is generally the most preferred type of gaming.
• The women prefer the casual games over the other two type of games.
• In case of young men the massive multiplayer online role playing games are becoming more popular.
• The action and racing games are the two most popular casual games in India.
• The most common medium used for playing is online gaming portals.
• The average money spent by online gamer is between RS 100 to 150.
• The most preferred games are action-adventure and racing games so there is a need to design more of these games.
• Gaming industry is growing at a fast rate but there not sufficient there gaming institute so there is a need to construct gaming institutes.
• Use of push marketing strategies for online gaming is required.
Questionnaire for Online Gamers
Q1 Name of the Person
Q2 Address of the person
Q4Age group of candidate
10 to 25 years 25to 50 years above 50 years
Working business student other
Q6category of online games you usually play
Casual games Massively Multiplayer Online Game’s
Massively Multiplayer Online Role playing Game’s
Q7If casual games, then what type
Arcade Card Strategy Action & Adventure
Puzzle Sports Racing
Q8how often do you play online games
Daily Weekly monthly seldom
Q9For how many hours you play online games
Less than 1hr 1 to 2 hrs 2 to 3 hrs more than 3 hrs
Q10You play online games on
Online Gaming Portals Dedicated online gaming Sites Social Sites
Cyber Café Other________
Q11how much money do you pay for online games in a month
Free games between Rs50 to Rs!00 Between Rs101to150
Between RS150 to 200 above Rs200
Q12 what type of games you think should be created in future
Some major online Gaming Companies
• Zapak.com (Reliance)
• Kreeda Games
• 7sea Technology
• Dhruva Interactives.
• Cha Yo Wo Technology solution(gamezindia.com)