Overview of the gaming industry:
The online gaming market in India has seen tremendous growth of late, driven, in part, by the surge in digital usage. Online gaming revenues grew by 59% year-on-year to reach Rs.49 billion in 2018, and are estimated to reach Rs.120 billion by 2021, at a CAGR of 35%.
Casual gaming revenues grew by 40% year-on-year to reach Rs.23 billion in 2018, and are estimated to reach Rs.49 billion by 2021, at a CAGR of 30%.
Real money gaming revenues grew by 82% year-on-year to reach Rs.26 billion in 2018, and are estimated to reach Rs.71 billion by 2021, at a CAGR of 40%.
The number of online players in India grew by 52% year-on-year to 278 million players in 2018, with the number of users projected to reach 340 million by 2021.
The proliferation of affordable smartphones, high-speed internet and falling data prices are the primary catalysts for this rapid growth. A total number of smartphone users in India estimated was around ~375mn in 2018 v/s ~300mn in 2017, growing around 25% year-on-year basis. –
Drastic reduction in data prices estimated from ~Rs.300/ GB in 2015 to ~ Rs.10/GB in 2018 – Number of Data users estimated was around ~582mn in 2018 v/s ~424mn in 2017, growing around 27% year-on-year basis.
Nazara technologies overview:
Nazara Technologies Limited (Nazara or the Company) is one of the leading Interactive Gaming and new age Sports Media companies headquartered in Mumbai and has operations in 64 countries spread across India, Asia, Africa and the Middle East. Nazara has diversified business models and comprises Subscription, Freemium, eSports, Skill-Based Gaming in India and Chance based Gaming business in Kenya, Africa.
Nazara’s goal is to cater to billion-plus mobile internet players across emerging markets who have embraced social multiplayer interactive gaming as the foremost form of entertainment. Nazara generates revenues from following business models and partners with digital payment providers, telecom carriers, ISPs and ad networks to offer a seamless intuitive experience to the players on Nazara’s offerings.
- Players’ spending money within games: Skill Based Games – players play with and win real money based on the preponderance of skill involved in the gameplay e.g. sports fantasy.
- Advertising revenues by selling inventory within games: Freemium – players download games from google play free of cost and they either see ads within the game or they buy virtual items within the game to progress further in the game or compete with each other e.g. World Cricket Championship, Chota Bheem Speed Racing etc.
- Media rights and events sponsorships: eSports – amateur players watch a live stream of the match being played by the professional players on OTT platforms & listen to live commentary. Millennial watch players playing PUBG which is akin to the grownups watching cricket on TV or on OTT platforms.
- Subscription of gaming services: Players subscribing to the daily/ weekly / monthly/ annual subscription packs wherein they get unlimited content with new content added on a regular basis.
The way forward as envisaged by the company with a focus on increasing the Nazara Technologies Share in the Market :
Transforming from a Telco Subscription focused Company to pure-play Interactive Gaming & sports
media platform: Building consumer-facing brands & IPs across 1) Freemium, 2) Skill Based Games, 3)Chance based on Games in Africa & 4) new age sports media business.
Attaining Vertical leadership: Nazara is focusing on creating #1 or #2 position in the verticals which it is going to operate.
The company has also acquired a strategic stake in various companies to further capture the gaming market.
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