Talk to anyone about the Indian games industry – be that those working in it, those providing data on it, and those eyeing it for expansion – and the word you’ll hear most is ‘nascent’. But while India’s game sector certainly is at its early stages, it’s also the one most ripe for growth and opportunity.
Witness the activity of three games industry firms with the biggest development resources – EA, Ubisoft and Sony – which have all looked to harness the territory’s talent base this year through a variety of means.
In April, Ubisoft agreed to buy Gameloft’s studio in Pune, West India. Like many of Ubisoft’s studios in emergent markets, the team there will initially be a co-developer and support studio, porting titles to handheld consoles and helping the French firm’s other testing teams. But in time, Ubisoft hopes the team will have over 200 staff within 12 months – a number it says will reach 500 within the following few years.
Electronic Arts has similar objectives. Last month it officially opened its Hyderbad-based studio in India. The outfit currently houses over 200 staff working on a number of projects for its parent. These include mobile game development, online services for The Sims, art development for PC and online titles, plus automation tools and technologies for the wider Electronic Arts operation.
Predictably, EA thinks the presence of big names in the region is good for the local industry, offering job opportunities for the local market. Amol Gurwara, head of operations for the mobile division of EA India studio, described the expansion of EA’s development interests into India as “a transformational phase for the Indian game development industry”.
But it’s hard to be cynical about the claims, as the efforts by these publishing superpowers is a far cry from the perception held amongst many that India is just a location for low-cost outsourcing. While the work done in the region by outsourcing heavyweights like Babel (itself now owned by an Indian firm, Quatrro) isn’t becoming old-fashioned or out date, it’s clear that there are shifts culturally and economically amongst both the industry and consumers that is improving the Indian games industry.
SCEE has played a large part in sparking that change at an industry level. It recently held an Indian developers conference to introduce local studios to its gaming platforms and, more formally, signed a number of studios to develop titles for the local market. This comes at a time when the industry in India is developing beyond the outsourcing model and increasingly-affluent consumers are turning to games consoles for entertainment.
“The business response to the increased activity for PlayStation has been encouraging. The last fiscal has seen almost a six times jump in console numbers and a ten times growth in the PlayStation games sales in India. The growth perspective continues in the current fiscal with a very positive outlook for the segment,” explains Atindriya Bose, country manager for India at SCEE. Bose points out that the establishment of a distribution pipeline through the Sony DADC Indian replication centre and a stringent attitude to piracy at government level has also been key to laying the foundations for a ripe local games market to sit alongside its burgeoning games industry.
But the development sector is most “critical,” says Bose.
“There are already established players in the animation area. The country’s capability in the IT space today is unquestioned. There are gaming companies being set up to be able to combine these strengths and move into the space of game development. SCEE has already organised a two-day developers’ conference in India under the aegis of Devstation Mumbai08. This created considerable interest in the Indian game development fraternity. This also saw the flagging off of the first Indian game with complete Indian content. SCEE has combined with Aurona Technologies, India to roll out a game on the character of Hanuman from Indian mythology. The competence and the state of readiness of the Indian developers makes it imperative that India soon will emerge as a key development hub for many international games companies.”
Sony’s activity has been welcomed by local studios, and not just those it has signed up for development deals.
“Other console manufacturers should take a leaf from their book. SCEE’s activity is very encouraging for Indian game developers and will definitely boost the gaming sector,” says Mohit Sureka of Mumbai-based Spiel Studios, one of those very firms offering both games development and outsourcing services. Formed over two years ago, the company began by developing titles based on Indian movies and celebrities for the local market, but has since carved a place for itself on the global stage. It’s one of the only Indian firms to become an authorised Apple developer for the iPhone, and is also one of the firms SCEE authorised to develop games for the PS2 and PSP.
Already, says Sureka, games companies in the region are looking to compete with rivals in other emerging Asian markets: “When we started out, there were only a handful of developers developing mobile and online games for the local market. To date, the gaming industry in India is in a very nascent stage and has the potential to grow by leaps and bounds. Recently, international developers have started recognising India as a potential hub for developing gaming products. India has a pool of one of the best animators and artists available in the world.
“90 per cent of animation and game art outsourcing happens from studios in India. Apart from matching international quality, India offers a significant cost advantage compared to other outsourcing destinations like Taiwan and South Korea.”
Middleware firms are also seeing the rapid development of the games industry in India first hand as companies in the region look for tools to aid their move from outsourcers to full-flavour studios. One of those is Servan Keondjian, founder of Qube Software, who recently spoke at DevStation Mumbai. “There was clearly a lot of excitement amongst Indian developers, not least because Sony have very astutely identified the PS2 as the console that’s going to crack India for them,” he explains, pointing out the machine “delivers performance at a price that is increasingly within the reach of middle class Indians”.
He adds: “There’s also a huge catalogue of existing titles for the PS2, while studios with an eye on the Indian market are busy developing titles created specifically for gamers in the sub-continent.”
Keondjian’s also done his research on the market opportunities, pointing to a report from Diana Farrell and Eric Beinhocker of analyst firm McKinsey on the economic changes that are giving rise to a wealthy middle-class. “While India’s middle classes make up quite a small proportion of the population at the moment, they still number 50 million, which is an exciting market, and by 2025 analysts like McKinsey have estimated that India’s middle class will have grown exponentially to almost 600 million people.”
Some of Qube’s initial signings for its Q middleware have been those in Asia. “From Qube’s point of view the fact that we offer a fully featured game engine that runs on the PS2 in its latest iteration means that we are generating a lot of interest in India. Studios are really attracted by the idea that they can use Q for the PS2 games they’re developing for India now knowing that when they move to the latest generation of consoles they have a true cross-studio solution that means they’ll simply be able to move all their people, their tools and their assets across seamlessly.”
Plus, the growth of the local market, on both consumer and industrial levels, will help feed a competitive spirit amongst studios in India and help raise quality of their output, Sureka says. “This will also overall increase the gaming community as there would be more Indian gaming content on offer. And it gives a chance for Indian developers to show their skills and expertise and develop games independently.”