The online gambling industry has been in uncertainty for nearly a decade now, but continues to make submissions to governments, industry bodies for a regulatory framework.
The industry is also convinced that the government is considering online games, whether real money games or casual games, to view them positively.
Shivanandan Pare, Executive Director and CEO of Deltatech Gaming (Adda52 and Addagames), believes that trust is inherent in the online gaming business, which becomes the most important factor in an environment without a regulatory framework. He also thinks that any distributor or brand that can crack the pledge code on the games will be a winner.
Pare says the industry is poised to grow from the current rate of around 30-35% if the regulatory frameworks are in place it can grow faster.
Online gambling has seen tremendous growth in India and the last couple of years have contributed a lot to that. How do you see this trend in the years to come?
The pandemic was a trigger. Mainly, the steps from the point of view of digitization had started in the field. The frames were already there on the market. If things like mobile connectivity, internet user base, UPI or digital payment and cheap data plans were missing, I don’t think the pandemic would have given digital businesses that kind of boost digital such as online games, OTT, e-commerce or any other digital transactions. Even the number of stock trading accounts opened during the pandemic has skyrocketed and this would not have been possible without the basic infrastructure of the digital ecosystem.
What are the challenges facing the real money gambling industry?
The most important thing, we will say unanimously, is the clear regulatory framework.
Globally, the Internet industry has always been ahead of government regulations. Take the Uber-Ola scenario ten years ago or e-commerce. In India, online gambling, which is purely our case, skill-based real money gambling, is a state subject. There is no regulator per se.
Real money games make up less than 10% of online games globally in terms of consumer attraction and if we add fantasy the number will increase by at least two or 2x or 3x because cricket happens to be the most popular game in the country. Fantasy sports are mainly based on cricket. From the point of view of online games, the universe is much larger than that of real money games.
Game monetization is a promising area. How do you see advertising creating impact for brands through online gaming in India?
Consumers playing or spending time on online games will continue to increase because as they grow, they grow with mobile games, they will continue to spend more time. The predominant time spent on digital media will be on gaming platforms, presenting an opportunity and a challenge for all brands and marketers. They can no longer ignore this particular vertical to engage with consumers or communicate their brand story.
From 2007 to 2010, consumers turned to social media. Brands only widely embraced social media and digital in 2013-2016, where everyone’s plan included a budget for social media as well as a digital budget or social media as a subset of digital .
The winning brands or successful marketers are those who have cracked the code of social media engagement. During this decade, say by 2024 or 2025, I predict that a substantial part of the budget will go to communication with consumers via gaming platforms. Any distributor or brand able to decipher the pledge code on the games will be a winner.
In one day, a regular player engages with the choice of game, between 30 and 60 minutes. Now that an hour of attention, if your brand can grab hold of it and have a presence there, that will be invaluable.
Do you think online games will be relevant for brands to reach in Indian tier 2 and 3 cities?
Consumer traction depends on accessibility. When I say accessibility, access is internet access and device affordability. As access improves, consumers will go digital. This displacement is not limited to certain pockets of the country. It will be generalized across the country, regardless of the level or socio-economic stratum of the city. The dominant growth will come from tier two, three, and four cities because that’s where penetration will be from a point of accessibility.
When 5G rolls out, it could start in urban areas and 4G would have reached everywhere. 5G will take less time than 4G. I believe the kind of investments these companies are going to make because the amount they’ve spent on licenses or good auctions, you’ll find they’ll be trying to push the mass adoption of 5G.
The average age in tier two, three and four cities is lower than urban from the perspective of internet users. It is the most economically active segment of the population in the sense that they will spend more, they will have more disposable income because they will have fewer family responsibilities.
Industries that target this particular age group tend to benefit more.
How is data protection ensured in the gaming industry?
In the real money gaming industry, trust is the most important factor.
Every player in this industry would like to continue investing to build and maintain that trust. Unlike banking or insurance, there are regulatory bodies that try to protect or ensure that certain standards are met. We do not have a regulatory body, but in the interest of our business, we ensure ourselves that there is absolute data protection. It is fundamentally necessary for the survival of every actor to focus on data protection.
We go the extra mile to ensure there is no trust deficit due to a data breach. So it’s in our interest, we individually, each player does it.
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