India’s gamers play to win with homegrown AAA titles
Even as the Indian real-money gaming (RMG) sector is feeling the strain of the newly imposed goods and services tax (GST), the country’s game developers are eyeing rising online gamer segments by creating home-grown big-budget titles.
Last month, Mayhem Studios, a Mobile Premier League-backed game developer, announced the closed beta launch of its battle royale game, Underworld Gang Wars (UGW). The game, which has been in the works for the past 18 months and has already amassed 7 million pre-registrations, will be India’s first-ever AAA game — a classification that signifies high-budget, high-profile games typically distributed and produced by large publishers.
Popular AAA games include titles like Minecraft, Grand Theft Auto V, Call of Duty, and Fortnite, among others.
“We believe that the launch of this game (UGW) will not only introduce a battle royale game rooted in India with realistic lore but also play a major role in strengthening India’s position in the global gaming industry,” Ojas Vipat, chief executive officer (CEO) of Mayhem Studios, told Business Standard.
More recently, Pune-based gaming studio Supergaming also rolled out the beta for its own battle royale game, Indus Battle Royale, on Google Play for Android users, garnering an immense 8.5 million pre-registrations. The mobile game, much like UGW, features India-inspired map design and characters and will be expanded to personal computers and consoles as well.
The release of these big-budget gaming titles will allow India’s nascent gaming industry to better compete with global counterparts. However, the development of AAA games typically requires a lot of capital, which could pose a challenge for indigenous developers.
“I think we have a lot of talent in India, but most of the current AAA games are coming out of Western markets, and Asian markets like Japan and Korea,” said Trivikraman Thampy, CO-CEO and co-founder of gaming unicorn Games24x7.
Crafting a successful AAA game tailored for the Indian market would entail incorporating elements aligning the game’s content, storyline, and characters with the preferences of local audiences. Refining technical aspects, including optimising the game for various devices, geographies, and navigating variable network conditions, are pivotal.
These developments become especially significant at a time when India’s gaming sector has been reeling from a newly imposed 28 per cent GST.
The GST Council, in July last year, decided to impose a blanket tax of 28 per cent on online gaming. Skill gaming platforms earlier paid 18 per cent GST on the platform fees, also known as gross gaming revenue. While the margins of gaming firms operating in RMG space have taken a significant hit, the release of homegrown AAA games signals an impending paradigm shift for the industry.
“We need to see more studios built in India for India,” said Salone Sehgal, founding general partner, Lumikai — a gaming-focused venture capital fund.
RMG found initial success in India’s nascent gaming market due to its high margins. As of 2022-23, the RMG segment had a market share of 84 per cent in the online gaming industry, according to a report by consulting firm EY. This is expected to go down to 75 per cent by 2027-28 (FY28).
According to industry watchers, as the country’s gaming industry matures, and consumers get acclimatised to digital transactions, gamers will migrate towards other segments like casual or mid-core games. Moreover, advertising revenue and in-app purchases from these casual and mid-core games are expected to drive most of the growth for the country’s gaming sector.
The Indian gaming market, valued at $3.1 billion, is expected to hit the $7.5 billion valuation mark by FY28, growing at a 20 per cent compound annual growth rate, according to a recent report by Lumikai.
The popularity of titles like Pubg, Free Fire, and Battlegrounds Mobile India indicates the robust demand for bigbudget games among Indian gamers. The coming years might see a substantial rise in refined, home-grown gaming titles, as long as developers can acquire sufficient funding.