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India to have 235 mn paid gamers by 2025: RedSeer-Lumikai report

India to have 235 mn paid gamers by 2025: RedSeer-Lumikai report

The paid gamers user base in India, according to the survey will be 235 million in 2025, a 3X jump from the number of such users -- 80 million -- in 2020

Online gaming market expected to touch $7 billion value by 2025 Online gaming market expected to touch $7 billion value by 2025

India has emerged as one of the fastest growing gaming markets in the world, with growth in new paying users (NPUs) now at over 50 per cent, and the overall the market expected to touch $7 billion value by 2025, according to a recent report by the RedSeer Consulting in association with Lumikai, India’s first gaming and interactive media venture fund. The statistics imply a 3X growth from 2021 on the back of a robust growth across casual and real money games segments.

The paid gamers user base in India, according to the survey will be 235 million in 2025, a 3X jump from the number of such users -- 80 million -- in 2020. Overall, India currently has a total gamer base of 425 million.

In 2021, the number of paid gamers in India is pegged at 95 million, which will grow by 25 per cent to 235 million in 2025, as per the survey. A majority of the growth in the paid gamers user base in the country will be driven by casual, mid-core and e-sports segments in the form of in-app purchases, tipping etc.

Online gaming to be a $7 bn market in India


On an average, a paid gamer in India spends $16 a year (Rs 1200) with monthly spends ranging from $0.6 (Rs 30) to $3.5 (Rs 230). Notably, the willingness to pay for playing games online has increased across the country with the entertainment and engagement of the games being key factors, the report pointed out.

The key drivers behind the spur in the paid gamers in India include the maturity of the gamers, adaptability to play online as well as UPI integration within the gaming platforms.

 “This is an exciting time for the gaming ecosystem in India. Access to gaming is democratised with increasing participation from Tier-2 cities and beyond, gamers are maturing in the way they play different gaming genres, and unprecedented growth in new-paying users (NPU) to drive the overall gaming market to become 3-times in the next 5 years. While real-money gaming (RMG) will continue to dominate the market, in-app purchases (IAP), virtual gifting, etc to become mainstream spend categories among paid gamers, and the revenue from IAP is expected to outgrow overall India’s gaming market growth rate,” said Mukesh Kumar, Engagement Manager at RedSeer.

How do gaming platforms make money?

Few years ago, monetisation of the online gaming platforms was an uphill task, But thanks to COVID induced acceleration in the gaming user base as well as inflow of funds into startups, the streams of revenue are now growing. The RedSeer report stated that while real-money games (RMG) are the largest source of revenue for the market, in-app purchases (IAPs) will grow faster for the next 5 years at 30-40 per cent with the rise of paying users in casual  and hyper-casual gaming.

“Further, Non-RMG gaming segments are expected to grow faster than the market growth rate, with eSports and streaming are expected to grow at 40-45 per cent CAGR for the next 5 years,” It added.

The revenue mix for the online gaming industry is evolving with change in game preferences. By FY26, RMG will likely constitute 53 per cent of total revenue followed by in-app purchases (31 per cent) whereas advertisements are estimated to contribute 11 per cent of the total revenue share.

“What has emerged is a picture of the market that already exceeds preconceived notions around size, growth, sophistication, and most importantly propensity to pay. India’s gaming market is due to 3x in value to over $7 billion by 2025, driven by a healthy diversity of monetization mechanics that indicate plenty of white spaces for new investment, and massive potential for a new generation of leaders across the gaming value chain. We’re excited to continue being at the forefront of India’s gaming investment landscape as the market matures and evolves to the next level,” said Justin Keeling, General Partner at Lumikai Fund.

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