Can Apple Arcade and SonyLiv’s online gaming apps monetise on potential engagement?

The Indian gaming industry is expected to be as big as Rs 11,880 crore by 2023, according to a  report by KPMG and Indian Federation of Sports Gaming.

And just like how players from different sectors are entering the video streaming arena, similarly the gaming industry is welcoming new players to be a part of its booming space.

Take the example of SonyLIV, which has become the first over the top (OTT) platform to launch online gaming on its platform. Not only can you watch shows and movies on SonyLIV, you can also play games based on shows like Crime Patrol, Baalveer, CID. They have plans to launch over 100 games.

The second new entrant in India’s online gaming space is Apple Arcade, which is available for Rs 99. It offers games like Overland, PAC-MAN PARTY ROYALE, The Enchanted World, among others.

Now, the question is: Will their entry in India’s online gaming space mean tougher competition?

According to Saumya Singh, co-founder, WinZo Games, “the competition will definitely go up, but the platform that will stand tall will be the the one that can monetise its platform very well.”

“Players who want to drive engagement on their platform will jump into this space because people on an average from tier II and III cities are spending 40-45 minutes playing games. So, if you want to take up the average time spent on your platform, then this is the obvious step,” said Singh.

“What I am critical about here is how will you monetise the time that people are spending. I think that’s where players in the past and the entire gaming industry had struggled. Gaming platforms were relying on monetization in the form of in-app purchases or ad-based monetization,” she added.

However, Singh believes that it is micro transactions that will encourage players to spend money on gaming platforms.

She said that users belonging to smaller towns do not make transactions worth Rs 99 in one go. In fact, people are comfortable spending smaller amounts.

“Apple Arcade is offering games for Rs 99 but if you ask people sitting in tier II, III, IV and V markets whether they are ready to pay Rs 99 the answer would be no,” said Singh.

Giving the example of consumption and transaction trends on WinZo, Singh said, “on our platform from tier IV cities, people are making transactions 28 times a month. These people would be making digital transaction for the first time and the average transaction they are making is of Rs 9-Rs 10.”

It is important to understand how gamers from smaller towns are paying for online games as it is this market which is the growth area for the online gaming industry.

According to a 2018 survey by Reycreo, users from tier II cities had the most active online gamers.

But does Apple and SonyLIV have an edge over other gaming platforms?

There is no denying that the awareness about the two platforms, Apple Arcade and SonyLIV, is higher among people. Hence, it would be easier for them to woo gamers.

However, Singh says believes that having an audience is not equivalent to saying that a platform is successful and the big question is whether people will be paying to play.