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Indian animation set to boom
Syed Amin Jafri in Hyderabad |
January 10, 2007 14:42 IST
The Indian animation industry is expected to grow at a CAGR of 25 percent during 2006-10 and Indian gaming industry at a CAGR of 72 percent over the same period, according to the National Association of Software and Services Companies' annual report on the animation and gaming industry in India.
The annual report was released at the two-day Nasscom Animation & Gaming India 2007 Summit that opened in Hyderabad on Wednesday.
The global animation market (demand perspective) estimated at $59 billion in 2006 and is expected to reach $80 billion by 2010. Global market for animated content and related services is estimated at $25 to 26 billion is forecast to cross $34 billion by 2010.
The worldwide gaming market (demand perspective) stood at $21 billion in 2006 and is expected to reach $42 billion by 2010, growing at a CAGR of nearly 19 percent over 2006-2010.
Worldwide gaming content market (developers perspective) was estimated at nearly $7 billion in 2006 and is expected to cross $13 billion by 2010, registering a CAGR of 17 percent over 2006-2010.
The Indian animation industry was estimated at $354 million in 2006 and is forecast to reach $869 million by 2010, representing a CAGR of 25 percent over 2006-2010. The Indian gaming industry was estimated at nearly $48 million in 2006 and is expected to cross $424 million by 2010, representing a CAGR of 72 percent over 2006-2010.
Currently, 300 animation companies employ approximately 12,000 people in India. Industry estimates indicate that nearly 3,000 freelancers also work in the industry.
To be able to maintain its share of the global pie, and grow it, there is a need for focused human capital development for animation and gaming sectors, and for government policy support in the Indian industry, the Nasscom report pointed out.
Making a case for focused human capital development for animation and gaming, the Nasscom report said that the number of professionals employed by the Indian animation industry in 2006 is estimated at 16,500.
This figure is forecast to increase at a CAGR of 14-15 percent and exceed 26,000 by 2010. The key constraint is the growing demand-supply gap in manpower availability that is expected to restrict the Indian animation industry's growth to $869 million against its potential of exceeding $1 billion.
The same holds true for the gaming segment as well. Currently, there are nearly 150 gaming companies in India, employing about 2,500 people. This number is forecast to increase at a CAGR of over 50 percent to exceed 13,000 by 2010, with the industry revenue forecast to growth nearly tenfold and reach $424 million.
This is significantly lower than the estimated potential of $732 million that the Indian gaming industry can achieve by 2010 if the supply concerns are addressed in time. Even at these impressive growth forecasts, the Indian animation and gaming industry will account for less than 2 percent of the worldwide market in 2010, clearly indicating a significantly larger opportunity.
Ensuring the availability of adequate, suitable manpower and a focused industry development program can help India achieve a larger share of the pie. Nasscom also pleaded for a government policy support for the Indian Industry. The broadcast (including animation) industries in countries such as France, Singapore, China, Korea, Canada and Philippines, have grown with the help of specific policy support extended by the local governments. The support offered has ranged from assistance in manpower development, infrastructure provisioning, direct and indirect investments, to promoting industry recognition.
Karnik, president, Nasscom, said animation and gaming in India has taken off in a big way in the past 2 to 3 years, owing to recognition of India's IT expertise and creative skills, entrepreneurial drive of companies and last but not the least, recognising this as a potential growth sector at the right time.
In addition to inherent factors like creative skills and manpower availability and cost advantage, external factors like growing maturity of animation studios, increase in number of co-production ventures, development of IP, and the attractive domestic market opportunity have immensely contributed to this industry's growth, he pointed out.
Karnik said to ensure further growth India's share in the fiercely competitive global market place, we need to focus our attention to factors like external investment and specialised training. The industry has the potential to offer significant opportunities to investors, companies and the government for which the industry needs human capital development and government policy support.