Monday, August 20, 2012

How games for mobiles are being monetised


Playing Angry Birds is Sandeep Sharma's favourite pastime while travelling. The 38-year-old marketing manager at Noida-based petrochemical company India Glycols Ltd, is on the road for up to 15 days a month. He finds it most annoying, however, when ads pop up on his Samsung Galaxy S2 touch-screen smartphone. "Even if I happen to touch an ad by mistake it leads me to another website, disturbing my game," he says.

While Sharma may return to demolishing the defences of the greedy pigs who stole the birds' eggs, others may not do so at all to particular games if they find the ads alongside an irritant. That is whyAlok Kejriwal, founder and CEO of online gaming company Games2Win, refuses to have ads in most of his applications. "An acne cream being advertised to an eight-year-old is very irritating," says Kejriwal. Once, not long ago, he was making Rs 1 lakh a day from the advertisements that dotted 'Parking Frenzy', one of the more popular among the 40 games his company has developed - which has so far seen 11 million downloads. But looking at the long term, he chose to forgo this revenue. He now makes money from his apps, by charging a download fee of 99 cents from users who want to upgrade to the advertisement-free premium version of the game with extra features after they have played the basic version.
Alok Kejriwal, Founder and CEO, Games2win
An acne cream advertised to an eight-year-old can be very irritating: Alok Kejriwal
Mobile gaming is set to become a big market in India, a country of 35 to 50 million passionate gamers. Its size is likely to balloon to Rs 1,430 crore by 2014 from Rs 240 crore in 2010, according to a joint report by KPMG and the Federation of Indian Chambers of Commerce and Industry.

And gaming app developers are trying out novel ways to make money from their products. Some pack in ads, while others like Kejriwal shun them but charge users to download games. Those choosing the latter option also have to decide where to display their games: on operators' sites such as Vodafone Live or Airtel Live or at app stores such as The Nokia Store or Google Play.

"The ad-funded model is not gaining much scale," says Samir Bangara, Managing Director, Digital, Disney UTV. His company charges users to download the premium versions of its games and earned Rs 54.5 crore in revenue for 2010/2011, mobile games being the largest contributor to its top line. But not everyone agrees with him.

Indore-based Twist Mobile, for instance, banks solely on ads for its revenue while keeping all versions of its games free. It has 30 games, of which the most popular is Zulux, with seven million downloads. Besides India, it targets Indonesia, Vietnam and Philippines where basic 'feature phones', much cheaper than smartphones, still dominate the market. "These are largely pre-paid markets where the average balance in consumers' phones is as low as Rs 9. We see no sense in expecting people to pay for playing games on their mobiles," says CEO Virat Khutal.

The jury is still out on whether telecom operators' sites or app stores make for savvier distribution. There is a huge difference in the charges: the former provide better display but keep back around 70 per cent of the download fee, while app stores charge only 30 per cent. Thus smaller players such as Twist Mobile are reluctant to approach operators.

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