This article has been written by Vatsala Bhardwaj, pursuing the Certificate Course in Media and Entertainment Law: Contracts, Licensing and Regulations from LawSikho.
Table of Contents
Introduction
Since the onset of the pandemic there has been an exponential acceleration in the gaming industry, there has been a huge spike in the audience who are participating in online gaming. Gaming portals such as Paytm First Games and Gamerji reported a 200% and 50% surge in their users over March 2020 respectively. The pandemic forced us all into our homes thus making gaming one of the threads of social interaction between people. The time spent by an average player playing games has doubled from 4-5 hours to 8-9 hours a day.
Gaming Statistics since the onset of COVID-19
With the World Health Organisation commending video games as a healthy social pastime to combat isolation during such unprecedented times, it is a win-win situation for the platforms as well as the gamers. The global video game market is estimated to be worth $159 billion in 2020, around four times the box office revenues and thrice the music industry revenues in 2019.
According to Newzoo’s Global Games Market Report, it is estimated that the world’s 2.7 billion gamers will spend $159.3 billion on games in 2020 and the market will surpass $200 billion by 2023. It suggests that mobile gaming saw the biggest increase and in 2020, mobile games will generate revenues of $77.2 billion, growing +13.3% year on year. There is also a forecast that the number of smartphone users globally will grow +6.7% year on year to 3.5 billion in 2020. The game revenues from Google Play will hit $27.8 billion, marking a +15% year on year increase in 2020, thereby claiming 36% of the global revenues. Latin America and South-East Asia are currently the most rapid- growing regions for online gaming.
Fantasy Sports players in India are expected to increase from 50 million in 2019 to 100 million in 2020. After the government inflicted a ban on sale of non-essential commodities, there was a notable surge in download of gaming applications. App Annie data reported that download of such applications peaked at 197 million in the period between 25th March to 3rd May, 2020.
It is an undisputed fact that COVID-19 spread like wildfire. It has caused a financial depression throughout the world in all sectors of the economy. However, gaming and streaming have emerged victorious in these times. Recently, a report from The National Purchase Diary Panel Inc. (NPD Group) stated that there has been a surge in the U.S. gaming industry and it managed to outperform itself on both quarterly and annual basis. In totality, the industry generated $11.6 billion in the quarter, which was equivalent to a 30% increase as compared to last year and a 7% from the first quarter, thereby making a record in itself. The overall sale of video game content reached $10.2 billion in the second quarter, which was 28% more in comparison to last year. Gains were marked in sectors of digital console, personal computer content, new physical content, mobile and subscription spending. In terms of video game accessories including, headsets, steering wheels, gamepads increased 50% to $584 million.
Increased access to Online Gaming
Publicis Groupe India reported that during 1st-21st March, 2020, gaming witnessed a 41% increase in time spent while Over-the-top platforms and entertainment accounted for 34% increase. Post America’s lockdown, a popular retail store, GameStop announced shutting down of 21 stores which led to an increase in the number of gamers downloading games while comfortably sitting at their homes. Out of all the participants in video gaming currently, 34% are playing video games at home with their families more and 27% are playing to socialise with others. A third of U.S. consumers and almost half of Gen Z and millennials say that video games have helped them get through this difficult phase.
In the month of April, Houseparty, an application allowing people to play games and video call at the same time, had 50 million sign ups. In a study by KPMG India dated September 2019, it is suggested that the Indian online gaming industry is set to become an INR 250.3 billion industry by 2024. There has been a paradigm shift in the manner in which Indians consumed data and content online in late 2019 and in the phase of the lockdown in 2020. According to a report by Broadcast Audience Research Council (BARC) and Nielsen, the number of smartphone game users per week increased from 60% in pre-Covid time to 68% during the Covid phase i.e. the lockdown. The time spent on online games also surged from 151 minutes per user per week before the lockdown to 218 minutes during the lockdown
Rise in Esports
An analyst at Wedbush Securities, Michael Pachter, explained the surge of gaming as straightforward. He said “People are at home, they have nothing to do, and are not commuting. You have more time as you are bored.” Deloitte’s 2020 digital media trends survey found that, during the pandemic, a third of consumers were first time subscribers to a video gaming service, watched Esports, used a cloud gaming service or a virtual sporting event.
During the early months of the lockdown, due to a halt on traditional live sports, esports propelled to newer heights. Esports streaming viewership increased by 75-100%. Amazon- owned application, Twitch, an interactive platform for live streaming, live gaming and esports tournaments estimated a 31% increase in viewership in March. Gamerji recorded a spike in its daily active users from 12,000-15,000 pre-Covid 19 to 40,000-50,000 during the lockdown. Paytm First Games also saw a commendable increase in its user base by 3 times, in March. The platform observed 75,000 new users daily. The global esports is projected to achieve $1.5 billion in 2020, doubling from there by 2022.
Talking about India, the pandemic has proved to be a boon for the gaming start-ups like Nazara Technologies, PocketAces amongst others. It is an estimate done by the Google- KPMG Report that the Indian online gaming market shall see a growth of upto $1 billion by 2021. Paytm First Games offers its users over 100 popular games including Ludo, Fantasy Cricket. It claimed that its user base saw an increase of nearly 200% during the lockdown. The platform has till date witnessed more than 90 million app downloads in this period.
Implication of PUBG ban in India
With the ban of PUBG, the game offering chicken dinner to the winner, there has been constant news of the game called FAUG being the Indian counterpart of the former Chinese game application. While most gamers are left extremely sad by the ban of their favourite game and have been expressing their grief and mourning its loss on the internet ever since, experts are happy with this decision of the Government. According to a report released by the Mobile Marketing Association (MMA), ‘The Power of Mobile Gaming in India’ the mobile gaming industry in India is estimated to reach $934 million in 2022 and the number of gamers is expected to swell up to 368 million by 2022.
Call of Duty Mobile extracted 1.15 million downloads after the ban of PUBG in India. As per data on Entrackr, Garena Free Fire’s downloads rose by 2.1 million post the ban. As of now, the game stands at 500 million plus downloads on Google Play Store. Pabje, the Indian clone of the banned game, managed to mark a rise of 100,000 downloads.
Boost in the engagement with online games
India is among the top five mobile gaming markets in the world with around 300 million gamers. According to Google, the daily search traffic for Microsoft’s Xbox Game Pass has increased by 50-150%. Delta Corporation Limited is the only listed company engaged in the casino (electronic, live and online) gaming industry in India. With the advent of online casinos, people now have more options to choose from. With great numbers, the global video game market is forecast to be worth $159 billion in 2020 which is around four times the box office revenues i.e. $43 billion in 2019 and almost thrice the music industry revenues i.e. $57 billion in 2019. North America accounts for a quarter of revenue. Mobile game revenues in 2020 will account for 48% of the global market.
Conclusion
Perhaps, the gaming industry is one of the few industries where data has shown a huge spurt. If the growth continues at this pace, even if it falls a bit post lockdown, it is expected that by 2021 people will spend around 180 billion dollars on online games. The unprecedented growth in this sector has left the stock market and other businesses in a state of awe. In the years to come, gaming shall flourish more and shall keep attracting masses. The number of gamers shall increase either way as now people are accustomed to considering online gaming as a leisure activity.
References
- https://economictimes.indiatimes.com/small-biz/startups/newsbuzz/egaming-companies-have-a-field-day-as-virus-keeps-millions-home/articleshow/75001617.cms.
- https://www.financialexpress.com/brandwagon/advancement-in-online-gaming-trends-from-lockdown-1-0-to-lockdown-5-0/1990610/.
- https://www.newindianexpress.com/magazine/2020/aug/30/all-eyes-on-indias-nascent-virtual-gaming-industry-the-countrys-new-booming-sport-2189143.html
- https://indianexpress.com/article/technology/gaming/how-covid-19-has-impacted-the-esports-industry-6529312//
- https://newzoo.com/insights/articles/newzoo-games-market-numbers-revenues-and-audience-2020-2023/#:~:text=Games,The%20World’s%202.7%20Billion%20Gamers%20Will%20Spend%20%24159.3%20Billion%20on,Surpass%20%24200%20Billion%20by%202023&text=Share%3A&text=As%20a%20result%2C%20one%20of,%2D19%2Drelated%20lockdown%20measures.
- https://in.reuters.com/article/esports-business-gaming-revenues/report-gaming-revenue-to-top-159b-in-2020-idUSFLM8jkJMl
- https://newzoo.com/insights/articles/mobile-games-market-engagement-revenues-covid-19-gaming/
- https://oxfordbusinessgroup.com/news/video-games-and-covid-19-impact-emerging-markets#:~:text=Latin%20America%20and%20South%2Deast,representing%20y%2Do%2Dy%20growth%20of%2013.9%25
- https://nikopartners.com/the-impact-of-covid-19-on-indias-game-industry/
- https://economictimes.indiatimes.com/tech/software/indians-hooked-to-games-during-lockdown-highest-ever-sales-and-gaming-app-downloads/articleshow/75682901.cms#:~:text=As%20per%20App%20Annie%20data,gaming%20apps%20increased%20by%2030%25.
- https://thetechportal.com/2020/08/10/us-gaming-industry-covid-19-sales/.
- https://www.npd.com/wps/portal/npd/us/news/press-releases/2020/the-npd-group-us-consumer-spend-on-video-game-products-continues-to-break-records/.
- https://brandequity.economictimes.indiatimes.com/news/media/gaming-and-ott-spike-in-covid-19-lockdown-publicis-report/75173664
- https://blog.marketresearch.com/the-impact-of-covid-19-on-the-role-playing-games-market
- https://www.project-disco.org/innovation/090420-entertainment-evolution-whats-happening-to-content-due-to-covid-19-part-2/#:~:text=Deloitte’s%202020%20Digital%20Media%20Trends,risen%2075%25%20during%20the%20Coronavirus.
- https://techcrunch.com/2020/04/25/this-week-in-apps-facebook-takes-on-houseparty-fortnite-comes-to-google-play-contract-tracing-api/
- https://assets.kpmg/content/dam/kpmg/in/pdf/2019/08/india-media-entertainment-report-2019.pdf
- https://inc42.com/datalab/esports-market-in-india-trends-opportunities-and-gaps/.
- https://www.washingtonpost.com/video-games/2020/05/12/video-game-industry-coronavirus/.
- https://www.project-disco.org/innovation/090420-entertainment-evolution-whats-happening-to-content-due-to-covid-19-part-2/#:~:text=Deloitte’s%202020%20Digital%20Media%20Trends,risen%2075%25%20during%20the%20Coronavirus.
- https://nikopartners.com/esports-in-asia/.
- https://deloitte.wsj.com/cmo/2020/05/05/esports-on-the-rise-evaluating-brand-roi/?mod=Deloitte_cmo_relatedcontent
- https://nikopartners.com/the-impact-of-covid-19-on-indias-game-industry/
- https://deloitte.wsj.com/cmo/2020/05/05/esports-on-the-rise-evaluating-brand-roi/?mod=Deloitte_cmo_relatedcontent
- https://www.livemint.com/news/india/covid-19-boon-for-indian-gaming-startups-11598163121632.html
- https://www.businessinsider.in/advertising/ad-tech/article/how-will-pubgs-ban-impact-the-gaming-and-digital-industry/articleshow/77905847.cms
- https://www.india.com/technology/pubg-mobile-alternatives-register-a-massive-surge-in-downloads-after-ministry-bans-the-game-4136158/
- https://www.sportskeeda.com/esports/3-games-saw-major-increase-downloads-pubg-mobile-ban
- https://www.sportskeeda.com/esports/3-games-saw-major-increase-downloads-pubg-mobile-ban
- https://economictimes.indiatimes.com/tech/internet/covid-19-lockdown-accelerate-online-gaming/articleshow/75640044.cms?from=mdr/
- https://us.sganalytics.com/blog/40-surge-in-the-time-spent-on-online-games-on-mobile-devices-the-future-of-online-gaming//
- http://www.deltacorp.in/group.html
- https://www.weforum.org/agenda/2020/05/covid-19-taking-gaming-and-esports-next-level/
- https://nikopartners.com/the-impact-of-covid-19-on-indias-game-industry/
LawSikho has created a telegram group for exchanging legal knowledge, referrals and various opportunities. You can click on this link and join:
