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Fantasy Gaming: The Comeback The gaming industry provides an activity to keep users entertained and explore their creative mind through the use of technology

By Prabhjeet Bhatla

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Fantasy games have gained massive popularity in India in the recent years. However, with most of the scheduled sporting event being cancelled to prevent the spread of COVID-19, fantasy games based on outdoor sports took a massive hit. But with gradual resumption of sporting events such as cricket and football, fantasy games are back in play.

Entrepreneur India recently organized a webinar to discuss the space, especially taking into consideration opportunities thrown up after the banning of Chinese apps and games, including the widely popular PUBG. The panelists included Vaibhav Domkundwar, chief executive officer and founder of Better Capital; Suhail Chandhok, founder of SuperCirc (AnalytiQ Sports Technologies); Saurabh Jha, founder of Playing11; and Paavan Nanda, chief executive officer and co-founder of WinZo Games.

The gaming industry provides an activity to keep users entertained and explore their creative mind through the use of technology.

Sports during lockdown were a fairy tale. With empty stadia and athletes stuck without training facilities, people turned to online gaming for entertainment. Budding streamers across the country have taken advantage of the lockdown by setting up YouTube channels streams to gain popularity, entertain audiences and enter the big leagues of online gaming.

E-sports shares its similarities and differences with physical sports. Though one need not train physically, honing skills and practicing combos for 5-6 hours every day is a different challenge that competitive e-sports gamers face. Tournaments hosted by games of the MOBA (Multiplayer Online Battle Area) genre often host them in huge arenas with a soaring crowd that encourages competition in real time.

All this free time has allowed for more users to connect and explore different gaming platforms that are available and boosted the use of multiple sources/providers. With the unknown future, predictions for the gaming industry are expected to rise with desire and usage across the board.

The gaming business model

Gaming revenues are almost entirely driven by consumer spending, but the business model has evolved significantly in recent years. Consumers today buy fewer games than previous decades, but spend more time with those games, shifting the business model from single-unit to recurring revenue generated from a base of active users.

As a result, the industry is laser-focused on increasing engagement per user. Aside from making video games as compelling as possible, the strategy for doing so has been the adoption of in-game monetization opportunities. This additional downloadable content (DLC) can include expansion packs, new features, tools and characters, and "loot boxes", which are effectively a lottery of virtual items.

This business model has come in tandem with improvements to gaming hardware, bandwidth and mobile internet which have made high-quality games more accessible across devices and platforms. Indeed, close to half of the industry's revenue now comes from mobile gaming.

Domkundwar champions the trial and error method behind every success. He said, "If we look at the history of the best games ever, they have been built by studios that have built, failed and built again and then succeeded after a very long time. So, it's just not about the technology as it depends on a lot of variables coming together and even the best teams have to struggle before creating something as huge as PUBG (PlayerUnknown's Battleground)."

A separate part of gaming is e-sports, which refers to organized, multiplayer video game competitions. Business models in e-sports closely follow professional sports—though competitions are far more fragmented—with majority of revenue coming from advertising and broadcasting. Although relatively small in comparison with the overall gaming market, e-sports is relevant here because it appears connected to the continued growth of gaming.

"Fan engagement is the key here. We should develop it from the aspect of using AI (artificial intelligence) and machine learning to make sure that the simulation can continue," added Chandhok.

"PUBG got the pulse of the nation with ease of their use of navigation and graphics, the graphics being just enough palatable for the Indian mobile devices… From a skill, idea and talent standpoint, India is not that behind and if we give enough resources, we sure will be able to deliver something like that," says Nanda.

This said, gaming is not immune to the coronavirus. E-sports, with its reliance on live events, have been one of the first parts of the industry to be affected. Most e-sports events have been cancelled or postponed, though some are taking place without audiences.

E-sports may be growing in prominence as a result of COVID-19. Sports leagues around the world have turned to the sector to find new ways of engaging with fans. Several e-sports competitions are being shown on live television, as broadcasters look to fill hours of scheduled sports content that were cancelled in the wake of the pandemic. NASCAR has been one of the most successful sports to augment cancelled events with its iRacing Series, with one event attracting a peak of 1.3 million viewers. Although e-sports revenues may have declined, the value of the sector more broadly has risen as a result of the low-cost marketing it has benefited from during the crisis.

"Fantasy is an extreme engagement in sports as well as e-sports. Over a period of time both will cover any gap howsoever and also scenarios like we faced in March and April at the starting of COVID," adds Domkundwar.

Hard hitting nostalgia

The consequence of COVID-19 on gaming has been a massive enlargement of the audience available to publishers. Gaming is typically an at-home activity, and a steady stream of headlines has shows that it is flourishing during the pandemic.

The idea of a "sports fan' has evolved; it is now more a social behavior than ever before by looking at a much bigger and inclusive way for all fans of sports and e-sports teams to play.

Female force

Talking about women participation in gaming, Chandhok said, "Maybe the trends will change. We saw with women's sports as well that it took time to engage. Their investment will translate into playing more games, it's just like when you bite the bullet, and you get sunk into it. They are taking the first step so it's just a matter of time."

To which Nanda added, "When it comes to playing games, there are a lot of women as far as competitive gaming is concerned, but the percentage is lesser. The gender inclusion of the entire 50 per cent of the society is going to be a massive boom for every sector in the near future"

Long-term transformation

Looking to the long-term, there are several takeaways from the recent spike in gaming that indicate future transformations in the industry.

The greater interest in gaming may accelerate a shift, already underway, towards the delivery of games via mobile and cloud-based platforms. Increasingly, even blockbuster titles are available on mobile devices. Cloud gaming, meanwhile, enables consumers to play streamed games across devices, often without the need for expensive hardware.

The industry clearly now sees potential in this distribution model. The second long-term trend is the widening of monetization avenues through subscription and free-to-play models. Subscriptions provide a reliable path to monetization for smaller, quality games that otherwise lack the marketing or monetization nous to break into the mainstream. Demand for ultra-high-end gaming is likely to remain popular, but services such as Arcade (Apple) and Game Pass (Microsoft) provide gamers with a large library of video games – often without the need for advanced hardware. Meanwhile, free-to-play games allow developers to monetize without needing to convince consumers to make up-front purchases. Instead, they offer in-game upsell opportunities such as upgrades and expansion packs. Such buffet models may even encourage consumption.

Thirdly, we should expect to see the gaming industry increase its partnerships with other entertainment sectors. Some video games become so popular that they spill over into cultural discourse. The most obvious recent example is Fortnite, which has made its mark on music, sports and television. The game has hosted live concerts, premiered new albums by major artists, and featured content from movie directors. During the pandemic, Fortnite hosted a live rap concert that attracted almost 30 million live viewers.

Finally, the pandemic may lead to the normalization of e-sports. E-sports is being popularized and legitimized in an unpredictable and profound way, thanks to the unprecedented (and accidental) adoption of e-sports by broadcasters, leagues and athletes seeking to engage fans.

At the very least, the pandemic has reminded media companies and brands that there remains an addressable market of highly engaged consumers. Recent developments will likely inch e-sports towards the mainstream.

Prabhjeet Bhatla

Former Staff

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