Budget 2020: Small gaming businesses await regulatory framework to create more jobs, boost competition

Budget 2020, Union Budget 2020 India, Budget 2020 India, Budget 2020-21

Union Budget 2020 India | Ease of Doing Business for MSMEs: The online gaming industry is going through an unprecedented boom. Riding on the mobile and internet revolution in the country, online gaming is now cutting across age and socio-economic groups. There has been a rapid rise in the number of gaming operators in India. With the Union Budget 2020 around the corner, the industry expects the government to focus on this sector as well.

The Ecosystem in India

The gaming space in India is growing at a fast pace and is estimated to reach $1 billion by 2021. With India having the world’s largest youth population and second-largest internet population, it makes the country one of the world leaders in the gaming sector. Adding over 190 million users to the online gaming market, India is no longer an ‘emerging player’ in the mobile gaming space. Skilled games are the top revenue generators with real money games being the money spinners for operators. Also, with the penetration of 4G+ internet into Tier II and Tier III towns, the mobile gaming market is only aimed upwards in the next few years. The Indian gaming industry is expecting several considerations in the upcoming budget to provide stimulus to this highly promising sector.

Avenues of Focus

Regulation has always been a hot topic in gaming. Some of the challenges faced by the online gaming market is a lack of clarity on regulations surrounding the various methods used by gaming studios to monetize their games. If we were to compare ourselves to established gaming markets like Europe or America, India is yet to set regulatory guidelines. For instance, markets in Europe are gaining a certain level of maturity where players expect a high level of service and quality from game developers and operators. At the same time, as the markets grow, regulators keep on evaluating their policies and implement new ones in an attempt to keep the industry accountable. We require the implementation of such policies in India.

Taking a cue from the global gaming markets, India needs to have certain policies in place that would provide validity to the nature of gaming businesses that young entrepreneurs are venturing into. Today, India does not have clear policies in this sector.

Jobs and Career 

There is immense scope for creating more jobs in this sector as gaming caters to a global market. According to NASSCOM, the Indian gaming industry does close to $890 million of business every year, and there are over 100 game development organizations in India already. Therefore, there is a rising demand for professionals in this field – from artists to programmers, designers to audio engineers. There are many exciting job opportunities available, which are not just about playing games but about creating them. A channelized approach would open up more opportunities for Indian youth in the gaming sector.

Freemium Revenues

Several gaming operators are experimenting with the “free-to-play” model which allows users to play various games for free. These free games will continue to drive the industry in the next few years. This model encourages people to play without committing money and operators typically monetize their games via advertising revenues or ‘In-app purchases’. Also, as publishers continue to gain a better understanding of the Indian gamers’ mindset, the engagement will continue to increase and lead to better monetization. Lucrative taxation policy in this sector will encourage more operators to enter the market.

Imperative Investment Opportunities

Budget 2020 has a lot of focus on several ‘ever-green’ sectors. Focus on newer sectors like ours would benefit not only the current operators but also the next generation. The ministry could consider increasing the threshold limits to encourage investment which will ultimately infuse more capital into the economy.