[Media Create] Game market and industry in emerging countries on indian ocean rim


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Digital game market in emerging market including South East Asia, India, Middle East and Africa.

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[Media Create] Game market and industry in emerging countries on indian ocean rim

  1. 1. 2014/5/18 Media Create Co. Ltd., Analyst Sho Sato Game Market and Industry in Emerging Countries on Indian Ocean Rim - Current Condition and Prospects
  2. 2. About the lecturer  Work at Media Create, a Japanese marketing firm specialized in game industry.  Specialized in research on game market and industry in emerging countries. Since I worked in an game industrial association in the Hashemite Kingdom of Jordan, I have close network with Middle Eastern game industry.  Besides making lectures about MENA market at CEDEC 2012 and 2013, I made a presentation about the game market in Arab nations, Iran and Turkey at the same meeting last year.  Invited by NASSCOM, the Indian IT industrial association, I will make a public presentation at NGDC 2014 (November 14 – 15, Pune, India) NGDC: Indian game developers conference http://ngdc.nasscom.in/ngdc2013 My lecture at the same meeting last year http://www.slideshare.net/ShoSato2/ss-22327913 (Japanese) http://www.slideshare.net/ShoSato2/the-game-market-in-arab-nations-iran-and-turkey-22328641 (English)
  3. 3. Emerging countries on Indian Ocean Rim 2, Middle East and North Africa (MENA) 1, Southeast Asia 4, Sub-Sahara Africa 3, South Asia Non Residential Indians have strong network Close relationship with Islamic culture Influence of Indian films (like Bollywood).
  4. 4. Overview of Southeast Asian game market While mobile game market expands quickly, PC game market is still not ignorable Unlike other nations in the region, Thailand has mid-scale console game market Indonesia is most populated country in the region and its mobile game market has unparalleled potential Though Vietnam is the largest PC game market in the region, further governmental regulations will increase a risk Income per capita was high, but Singaporean game market is quite small due to limited population PC game occupies more than half of the market in Philippines Malaysia has higher ARPU than Indonesia but market potential is smaller Game market in Laos, Myanmar and Cambodia is underdeveloped. Brunei has similar market structure to Singapore.
  5. 5. Overview of Southeast Asian game industry Game companies from developed countries sometimes has offices in Singapore and other countries in the region Malaysia has both game developers and localizers Around 60 game studios in Philippines mainly work as subcontractors for western game companies. 90% of their sales came outside the country In Indonesia, a large number of developers locate office in Jakarta, Bandung and Surabaya Some game companies put an office in Singapore as governing other development studios in the region Regional publishers such as Asiasoft locate office in Thailand Vietnam gradually shows development shift from PC to mobile. Industrial accumulation in Hanoi and Ho Chi Minh Few game companies in Laos and Cambodia. We did not confirm any game studios in Myanmar so far. Brunei has a serious game company.
  6. 6. Recent topics of South East Asian game industry  Due to recent expansion of smartphone game market worldwide, many startups develop games for global market rather than local market. Local game studios, however, often struggle with getting funds, thus few companies like Agate in Indonesia successfully scale up  Since Flappy Bird developed by Vietnamese made a gigantic hit, IT incubation funds and public investors closely watched game development scene in emerging countries.  Formerly PC game dominated the market, with Chinese and Korean online game companies regarding there as a “backyard”. Recently the advance of major console and mobile game companies and local events held by Nikkei BP strengthen presence of Japanese game companies compared to other regions. Game & Creative Contents Networking by Nikkei BP http://expo.nikkeibp.co.jp/g-networking/bangkok/index.html DreadOut, an Indonesian Horror game, raised funds at Indiegogo https://www.indiegogo.com/projects/dreadout
  7. 7. Recent topics of MENA game market  In 2013, total game market in MENA (Arab, Iran, Turkey) was estimated to be 220 billion yen and around.  Game studios in the region such as Peak Games shifted from web apps to native apps because of the increase in network speed (i.e. 3G, LTE) and penetration of smartphones. In native apps market, localized titles are increasing their presence.  The number of female game users is rapidly increasing in the whole Middle East including Saudi Arabia and Turkey.  Students studied in western countries lead popularity, and expansion of game players will be noteworthy. “Nida Harb 2”was localized by Arabic game developer “Babil games.” http://babilgames.com/ Okey, a representative game by Turkish developer Peak Games http://www.peakgames.net/#5
  8. 8. Recent topics of MENA game industry • Both internal and external investment in game industry is accelerated. In 2013, Lebanese game companies gathered more strong attention than Jordanian game companies: a good example is “Zakeh” that developed “Pou”, a long-selling game for kids in Europe, North America and Latin America. • Rather than North American and West European companies, North European companies such as Star Arcade in Finland, and Asian companies from China and Korea advance to the region. • Many game companies purchase licenses for international game IPs and get funds in gulf nations such as UAE, and develop games in the countries like Jordan, which has cheap and abundant IT-related human resources.“Survival Race” by Wixel Studio http://www.wixelstudios.com/abou-ahmad/ Pou http://www.pou.me/ (cf. WamdaのHow a 24-year-old Lebanese entrepreneur found global success by beating Tamagotchi at their own game)
  9. 9. Recent topics of South Asian game market • According to estimation by NASSCOM, Indian game market in 2014 will be amount to 18 billion yen, and it will expand to 25 billion yen and around. • North western cities in India have certain amounts of console game market. Recently, game specialties such as Game4U and Games The Shop expand their business in shopping malls. But, various tasks still remain such as logistics and high tariffs. • Though use of mobile contents is increasing, unit price of entertainment is quite cheap as a whole, so expansion of the game market in revenue takes further time. Fans of FIFA 13 lined up in October 2012 http://gamingbolt.com/fifa-13-game4u-midnight-launch-was-a-massive-success Estimated by NASSCOM Game market and game users in India in 2015
  10. 10. Recent Topics of South Asian game industry • According to India’s Game Studio Directory, as of 2012, number of game companies in India was 125. 28 organizations have more than 100 staffs. • Many game companies have offices in Mumbai, Hyderbad and Bangalore, and, like Indian IT companies, they often develop games or parts of games for North American game companies. Western game companies such as Microsoft, Gameloft, Disney, Zynga and Glu already have offices in India. • Most Indian game companies develop games not for Indian game market but for global game market. • India has plenty IT engineers, some of whom have development experience in North America. While they have long business results and are good at engaging in specialized works, establishment of creativity will be the important topic.Number of game companies in India http://www.nasscom.in/sites/default/files/userfiles/file/Indias_Game_Studio_Directory.pdf
  11. 11. Example of Indian game companies: Lakshya Digital  Established in 2004, Lakshya Digital is the largest Indian game studio as for number of employees. Employing more than 200 members, the studio has offices in India and Singapore,  They are authorized developers for Sony and Microsoft, and are notable for making more than 95% of Xbox Live Avatars. They participate in development of Uncharted 2, WWE, Disney Epic Mickey and so on.  Having strengths in 2D and 3D game arts, the studio also has Japanese staff.  As for in-house games, they developed “Rage Warriors,” a mobile game for iOS released in September 2013. Portfolio of Lakshya Digital http://lakshyadigital.com/lakshya-3d.php
  12. 12. Sub-Sahara African game market and industry  So far in Africa, South Africa is the only established game market. According to estimation by PwC, its market scale in 2012 was around 25 billion yen.  According to MCV, characteristics of South African game market were similar to Western European game market, and games for core-gamers are more popular than games for families.  Penetration of telecommunication infrastructure is accelerating in the whole region, and regional unique mobile services like M-PESA are increasing. Switching from feature phones to smartphones proceeded less smoothly than other regions. Slow internet speed was also a significant problem for online games.  Since global investors pay attention to Nollywood movies and IT industry in Nigeria, which became the largest GDP in the region, it might possibly become the regional entertainment hub including games for the future. Last year’s rAge, a game conference in South Africa http://www.rageexpo.co.za/visitors-centre/ http://www.rageexpo.co.za/gallery/?album=2&gallery=16 GameTruck Nigeria by a photo essay “Gaming in West Africa” http://www.polygon.com/features/2013/12/13/5123338/gaming-west-africa-photo-essay
  13. 13. Summary and prospects ・Relaxation in restrictions on capital, development, distribution, promotion and consumption makes emerging countries more important for game development ・Most local game studios develop games for global market ・Lack of local publishers and establishment of creativity are the most important subjects ・Unique business schemes using mobile phones might possibly buoy African game industry ・Mobile game market in emerging countries will surge if career payment will be introduced Number of small game studio is skyrocketing in emerging countries. While Southeast Asia and MENA has huge market potential, South Asian game industry is noteworthy. In 2019 Industry Scale Small Medium Huge MarketScale huge Saudi Arabia Indonesia Medium Malaysia South Africa UAE Turkey Iran Vietnam Thailand Small Nigeria Cambodia Jordan Lebanon Pakistan Philippines India ※According to our estimation
  14. 14. Introduction of our forthcoming report on emerging game market  By the end of 2014, we plan to publish “EGR” monthly. EGR updates the latest trends of game market and industry in emerging countries.  Before that, we will publish its pilot or introductory edition, “Emerging game industry report: a separate volume for the game industry report” in August this year. ※So far we plan to publish only in Japanese.
  15. 15. Scope of our report Middle East and North Africa Eastern Europe, Central Asia Sub-Sahara Africa Latin America Southeast Asia East Asia South Asia Now we are seeking for collaboration with specialists of game industry in each emerging country! Contents on our emerging game market report (around 100 pages) Macro data such as estimation of game market in each country Roadmap of emerging game market Contributions from specialists Recent trend of market and industry Custom & Culture Legal structure Price & Communication Index List of conferences overseas Generational analysis
  16. 16. Aim of the report on emerging game market We plan that the first 100 customers can get this report free of charge. (As a rule, one volume per each) If you are interested in the report, please contact the adress below: info@m-create.com Later we will send you details about the report and clarification on how to make pre-order.
  17. 17. Thank you very much! Media Create Co. Ltd., http://www.m-create.com/ info@m-create.com Sho Sato, Analyst sato@m-create.com