According to research firm Avendus Capital, the mobile games and application market in India is expected to reach Rs 27 billion by 2016. The key growth drivers for the industry will be increasing adoption of smartphones and an expanding 3G user base.
The number of smartphone users in the country is expected to reach 67 million in 2013 and grow to 382 million by 2016. The number of 3G subscriptions in the country is expected to grow from 56 million in 2013 to 266 million by 2016.
Avendus Capital states that over 50 per cent of mobile internet traffic and paid content revenues is contributed by smartphone users. Amongst subscribers, Google and Apple store are the most preferred platforms to download and access applications. Google Play and the Apple application store are expected to clock in revenues of Rs 8 million each by 2016. The average revenue per user for paid applications is expected to decline from Rs 132 in 2012 to Rs 78 in 2016. However, the growing 3G subscription base will result in overall revenues from paid applications to grow from Rs 3 billion in 2012 to Rs 20.65 billion by 2016. Currently, mobile content in the country is dominated by five categories including cricket, music, news, video and games. Facebook, Google and WhatsApp account for the majority of a customer?s time share online.
Going forward, the growth in the feature phone segment will also support the development and maturity of the applications and games ecosystem. Home-grown mobile phone companies have a stronghold in the Indian feature phone segment and they therefore have tremendous business opportunities to develop hyper-local models like browser content, entertainment and m-commerce. While smartphones are driving the traffic towards third-party application stores, a large number of consumers using feature phones provide a huge market for operator-backed application stores.
