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Market Profile -- India
Population: 1,166,079,217 (July 2009 est.)
GDP per capita: $2,800 (2008 est.)
Internet users: 80 million (2008)
Mobile telephones: 362.3 million (2008)
(Source: CIA World Factbook)
India is up to 12 hours ahead of North America -- and it could be the time zone or the lives of 1.2 billion people bouncing off each other, but it feels as if India right here, right now, is the center of the world.
I moved here more than 12 months ago after more than eight years in the UK mobile games industry. I thought I'd seen everything until I came to India. But for every carrier, there is a nuance, and for every handset, a new business model. More pertinently, it is a land of varying signals and patchy reception. How I long for five bars to appear on my mobile and crystal-clear coverage.
Where to begin? Well, with more than 10 million new subscribers being added every month, it isn't exactly a stagnant market; as an increasing number of carriers fight for market share, this should be a golden age for mobile games.
But let's start at the beginning. India has a population of almost 1.2 billion people, 400 million of whom are lucky to eat a meal every day -- yet this is also a country that earlier this year sent a rocket to the moon. It is pressing for a seat on the Security Council of the United Nations, but also suffers from endemic corruption and has a road system that is more rutted track than highway.
And while 120 million new mobile subscribers join up every year, the country still has less than 30% mobile penetration. The market is even more exciting than China. But something is holding the Indian tiger back. And guess who's to blame? None other than the big bad carrier.
The four major carriers, Bharti Airtel, Vodafone, Reliance, and Tata have fairly comprehensive coverage all over India, but each urban territory, known as a "circle", has any number of smaller carriers competing with the Big Four. While competition is keen for text and SMS, mobile games are far behind music as the entertainment of choice for the mobile user.
In May 2009, mobile music officially took over from traditional retail as the biggest music market in India when Bharti Airtel announced that for the first time the company's registered music revenues had exceeded those of Saregama, Indian's largest music record company, whose latest registered figures at the end of the 2008 fiscal year were $300 million. And that's just one carrier, albeit one that has 32% of the market.
Compare this with mobile games. According to industry analyst MobileSQUARED, this market only turned over $42 million in 2008, way behind mobile music, and while this figure is expected to double in 2009, there is much room for improvement.
Samir Bangara is COO of Indiagames, one of India's biggest mobile games publishers, and he believes that the biggest hurdle to the development of the market is the revenue share that carriers offer publishers.
"Different carriers have different business models and I obviously don't want to name names, but let's just say a 40 to 50 percent revenue share funds creativity, but those that give 75% to the carrier choke the system.
"The Indian mobile market is still immature and the demographic is very much geared toward casual games and the under-30s. Games based on cricket and Bollywood stars are extremely popular, as well as action genres such as Batman and Superman, but the Indian mobile business model is very different than the West," he says.
Bangara is correct in pointing this out. While most Western countries operate from a contract model, India's predominant model is 'pre-paid' rather than 'post-paid', meaning most subscribers are very careful with their mobile rupees and how they spend them.
India is a country where credit card use is minimal and the iPhone doesn't really exist. Both of these factors add to the relatively slow take-up of mobile games. While Vodafone Live has recently launched an Apps Shop and the other carriers are in process of emulating Vodafone's lead, a disproportionate carrier revenue share is something the market could do without.