Animation & Gaming Industry in India: Report

Animation is taking off in India in a big way. It is quite evident from the fact that mainstream animated movies are getting released in Bollywood and many others in pipeline.

On other hand even offshoring of animation services to India are on a uptrend, which is visible from the numbers released by the NASSCOM Animation & Gaming Report.

The Indian Animation Industry

The Indian animation industry is estimated to grow at a CAGR of 22% to reach USD 1 billion by 2012 which was USD 494 million in 2008.

In comparison, Globally, the animation industry is expected to grow at a CAGR of 10% to USD 100 billion from USD 68 billion in 2008.

Given the financial meltdown many western countries are actively looking at destinations like India to develop animation content with moderate budgets. The increased interest of Bollywood and regional cinema industry for animation has boosted the growth for the industry. The Indian animation industry has moved from a pure offshore model to co-production model in some cases with Indian studio contributing with it manpower and infrastructure, the international producer contributing with marketing, distribution etc.

(Note: The animation Industry is classified in following segments -Animation entertainment, animation education, custom content development and multimedia/web design and VFX).

Revenue from Animation Industry (in USD Million)

Animation Industry Breakup	2008	2012
Animation Entertainment	107	207
Custom Content Development Multimedia / Web Design	256	542
VFX	65	174
Animation Education	67	173

The Indian Gaming Industry

The Indian gaming industry is estimated to grow at a CAGR of 49% to reach USD 830 million by 2012 which was USD 167 million in 2008.

Globally by 2012, the gaming industry would grow at a CAGR of 10.5% to USD 53.6 billion from USD 21 billion in 2008.

Revenue from Gaming Industry (% market Share)

Gaming Industry Breakup	2008	2012
Online Gaming	22%	15%
Mobile Gaming	26%	35%
Console Gaming	39%	39%
PC Gaming	13%	11%

By 2012, the console gaming segment is expected to maintain its lead in market share at 39% as in 2008, followed by mobile gaming at 35 % which was at 26 % during 2008.

Surprisingly Online gaming and PC gaming market is expected to see a drop with 15% as compared to 22% during 2008 and PC gaming at 11 % of the market which was 13%.

	2008	2012
Gaming Consumer Market	105	610
Gaming Services Market	61	220

(all figures in Million USD)

With falling console prices, increasing mobile and broadband penetration are expected to give the required boost to the consumer markets .The report states that by 2012, Indian gaming services will move up the value chain with more end-end to work offshoring work in terms of development services coming to India.

The services side of business is being propelled by captives of international publishers of mobile game development, BPO support for MMORPG games. Also PC/console game production, game art contributes to the development revenues.

Future Outlook of Indian Animation & Gaming Industry as per NASSCOM Report:

• As offshore delivery model matures the cumulative effect of improved skill sets, quality of development, on time delivery combined with cost advantage and scale can lead to expansive growth
• Demand for domestic IP is expected to grow as animation and gaming seeps into India culture with local themes, better promotion and wider distribution
• Falling costs of gaming hardware and software will spur uptake in the domestic market and reduction in duties can significantly accelerate the market
• The entry of global majors and setting up of captive centres are significant milestones and as the momentum picks up this will transform the animation and gaming landscape