Alien Invaders (overwhelming competitors from outside the market category and geography) have enjoyed great success in the Indian gaming marketplace. There have been bumps and hurdles placed in their way.
Earlier projects pegged the incremental growth in Indian online gamers at 190M. With the existing count at 290M in 2017 that translated to a USD$1B market. Online game/apps from China, Singapore, and the US coming into the Indian market are bumping up current estimates to 420M gamers and 510M total users to more than USD$2-3B in market. The future looked very bright for these Alien Invaders. Then government took action.
Game/apps from China were targeted. Microsoft voluntarily withheld some games from the Indian market. The governments of Tamil Nadu, Karnataka, and Andhra Pradesh took action against perceived “gambling”. Many US states have wrestled with similar prohibitions in the USA market. Regulatory and legal restrictions are being tested, and retested, in the courts in proceedings over Tamil Nadu’s and Karnataka’s actions. Legal and regulatory ambiguity will continue until definitive rulings reach resolutions.
In early 2022, the total number of game/apps banned by the Indian government was more than 300. These bans have spurred conversations at the highest levels. Hundreds of millions, if not billions of $USD have been affected.
The Singapore government has raised discussions with the Indian government about the ban on SEA’s “Free Fire” and related content. This may affect up to USD $400M of transactions per year. The stock value of SEA had seen a reduction of up to USD $16B stock market value. Games/apps are not trivial. The large economic impacts of bans have created diplomatic level concerns.
The repercussions are not simply lost sales. An Indian directive to maintain data collected and handled by game/apps in Indian data centers is forcing investment in India based Data Center services. Indian concerns about data being sent back to China and other countries was cited in banning some game/apps.
In part, the directive has contributed to the rapid growth of the Indian Cloud industry. Microsoft is opening a 4th datacenter in Telangana (est. USD$b2B investment, totals USD$b10B revenue in last 5 years, 18,000 Indian employees). Amazon is opening a 2nd datacenter (est. USD$ 2.8B investment). Adani Group has announced plans for 6 data center operations across India. The growth of Cloud services in India, driven in part by game/apps, is to USD$10 B/year. The economic impact and value of retaining services and data centers in India is growing.
The reach and importance of apps/games on mobile driving mobile data usage and data center demand is growing. Estimates are 52% of Indian gamers are women in metro areas and 29% in smaller settings. The number of likely users is second only to China’s market. Critical to long term success driving data consumption for carriers is having the broadest base of people using online services and games.
From a non-existent industry online game/apps employ tens of thousands, are linked to USD$B’s of investment, and are pervasive in use in India. The linked health of mobile carriers is also a key economic focus of government. More news is coming!
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