Gaming

www.ManagementJuice.
com Computer Gaming Industry – Himans hu Ahire
Why game industry?
“Why to play computer games?” “It’s a waste of time and money.” “Computer Games make
teenagers computer addict.” “It’s for children not for us.” “No future for career in gaming
industry.” “Is there any industry available which is called as Gaming Industry?” These are the
typical answers received when I asked some people about computer games and video games. As
computer and IT itself is very new for us that we don’t even know what are computer games.
In India computer Games are treated as “A thing which children play”. No one think seriously
about the opportunity available in the gaming industry. For those who suspect on the future of
gaming industry these are the some facts publish by Interactive Digital Software Association by
doing research on American market of gaming industry.
• 60% of all Americans age six and older, or about 145 million people, play Computer
and video games.
• The average age of a game player is 28 years old.
• 43% of game players are women.
• The vast majority of people who play do so with friends and family. (Almost 60% of
frequent game players play with friends, 33% play with siblings, and about one-quarter
play with their spouse and/or parents.)
• Computer and video game software sales grew 8% in 2001 to $6.35 billion and are
expected to show strong growth over the next few years.
• In 2001, over 225 million computer and video games were sold, or almost two games for
every household in America.
• Over 90% of all games are purchased by adults over the age of 18.
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www.ManagementJuice.com Computer Gaming Industry – Himans hu Ahire
• 56% of the most frequent computer and video game players have been Playing games for
six or more years, while 60 % expect to be playing games as much or more ten years from
now as they do today.
Sales of game software alone reached $8.4 billion last year, putting the game industry
in striking distance of Hollywood, which had box-office sales of $8.35 billion in 2001. And
video game executives predict this year will be even stronger
Video/PC games represent the fastest growing segment in the entertainment industry.
• The video and computer game industry was the fastest growing segment of all
entertainment industries in 1998.
• The video game and computer game industry grew more than 25 percent in 1998 on a
revenue basis. By comparison, motion picture box office receipts grew by 9.2 percent in
1998.
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Computer Games and its different types
What is a genre?
Genres are definitions of attributes by which you can group things. Genres help us understand
what we like and what we don't by providing a common reference. A game is like a recipe, it
needs combinations of spices to liven it up, but they still have their basic elements. Casual gamers
often make mistakes while buying games, because they don't understand genres. Good games are
not chosen because they belong to unfamiliar genres. Some games are not bought because the
customer is prejudiced towards the genre. For instance not all RPG games are exhausting and
slow, and not every Flight Sim requires extensive amounts of manual reading and key
memorization. It's an affliction, a genetic habit, an inbred instinct of humans to classify objects
into categories.
Basic Game Genres
There are 6 primary game genres. These broad classifications fairly encompass all the possibilities
the gaming platform can offer right now. Puzzle solving and Arcade games do not warrant their
own genre, as they are ingredients of all types of games. War games fall into the Strategy genre.
Some may incorporate more than one genre element; for example System Shock 2 was a First
Person Action/RPG game. Gaming Law #1:No new genres are created. Basic ingredients are
simply reshuffled.
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FOLLOWING ARE THE BASIC TYPES OF COMPUTER GAMES
The Gaming Family Tree
ACTION STATEGY ROLE

PLAYING
SIMULATION ADVENTURE SPORTS
Action games
It includes
• first person shooters,
• third person shooter,
• 1 on 1 fighting
• arcade,
• tactical action games.
•
First person shooter (FPS) is a 3d view of the game in first person. We explore the gaming
environment from the first person perspective; the camera always looks wherever you look.
Arcade games combines different elements of the game play into packages that are
almost indefinable. Arcade games were the first kind of games, and the through the games have
evolved and become the more complex, arcade is the foundation on which they stand
Why Do People Play Games?
Game-playing requires two components: a game and a player. The game designer works to
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produce a game, and so his immediate preoccupation is with the game itself. Yet, his final goal is
to educate, entertain, or edify the game-player; hence, the human player is he proper primary
concern of the game designer. Why do people play games? What motivates them? What makes
games fun? The answers to these questions are crucial to good game design. One way to address
the question of the purpose of games is to inquire into their history. Games now are too varied, too
intricate, too involved, to indicate a single clear function. Perhaps their fundamental nature would
be more evident in their earliest incarnations.
Fortunately, direct recourse to paleontology is unnecessary. A trip to the zoo will suffice.
There we find two lion cubs wrestling near their mother. They growl and claw at each other. They
bite and kick. One cub wanders off and notices a butterfly. It crouches in the grass, creeps ever so
slowly toward its insect prey, then raises its haunches, wiggles them, and pounces. We laugh at
the comedy;
we say that the cubs are playing a game, that they are having fun, and that they are such
fun-loving, carefree creatures.
We are right on the first count: these cubs do indeed appear to be playing a kind of game.
We may be right on the second count; who knows if lions can have fun? But we are dead wrong
on the last count. These cubs are not carefree. They do not indulge in games to while away the
years of their cub hood. These games are deadly serious business. They are studying the skills of
hunting, the skills of survival. They are learning how to approach their prey without being seen,
how to pounce, and how to grapple with and dispatch prey without being injured. They are
learning by doing, but in a safe way. Better to make mistakes with butterfly and sibling than with
the horns of the wildebeest.
Games are thus the most ancient and time-honored vehicle for education. They are the
original educational technology, the natural one, having received the seal of approval of natural
selection. We don’t see mother lions lecturing cubs at the chalkboard; we don’t see senior lions
writing their memoirs for posterity. In light of this, the question, "Can games have educational
value?" becomes absurd. It is not games but schools that are the newfangled notion, the untested
fad, the violator of tradition. Game-playing is a vital educational function for any creature capable
of learning.
We commonly associate the playing of games with children. Indeed, "play" as an activity is
considered to be the almost exclusive preserve of children, and the term is applied to adults either
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disparagingly or jocularly. Children are expected to play games because we recognize (perhaps
unconsciously) the fundamental utility of games as an educational tool. As children grow up,
cultural pressures change and they are encouraged to devote less time to the playing of games so
that they can devote themselves to more serious activities.
Hence we can say that fundamental motivation for all game-play is to learn. The
educational motivation may not be conscious. There are many other motivations to play games
that have little to do with learning, and in some cases these secondary motivations may assume
greater local importance than the ancestral motivation to learn. These other motivations include:
1. Fantasy / Exploration,
2. Nose-thumbing,
3. Proving oneself,
4. Exercise,
5. Need for acknowledgment.
Fantasy/Exploration
A very important motivation to play games is fantasy fulfillment. Like a movie, a book, or music,
a game can transport the player away from the tawdry world that oppresses him and create a
fantasy world in which he can forget his problems. Games are potentially superior to the
traditional means of escape (movies, books, music) because they are participatory. Instead of
merely watching a movie reading a book, or listening to music, the player is actively involved in
the game. Indeed, the player drives the game, controls it in a way that is quite impossible with the
passive fantasies. This need to escape, to fantasize is certainly an important motivation.
Nose-Thumbing
A common function of games is to provide a means of overcoming social restrictions, at

least in fantasy. Many games place the player in a role that would not be socially acceptable in
real life, such as a pirate or a thief. An excellent example of this is the game Thief (released in
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1998) by looking glass studios. In this game player plays a role of thief and objective of game is
to stole more and more gold from the rich people. Player can experience thrill in stealing from
once house. This experience make thief so famous.
The most telling example of this nose-thumbing phenomenon lies in the arcade games.
These games emphasize violence, and lots of it. The theme is almost universal in arcades: destroy
some-body. The player can thumb his nose at social strictures and engage in violence and mass
murder without risking censure. The game provides a safe way to thumb one’s nose.
Proving Oneself
Another function of games is as a means of demonstrating prowess. All games support this
motivation to a greater or lesser degree. Many game-playing communities sponsor tournaments or
player ratings. Arcade games support this function by recording and displaying the initials of the
top-scoring players. There are also players who carry this to extremes. Their prime goal is not
merely to win, but to beat somebody, preferably somebody worth beating. Chess has an unusually
high concentration of such sharks; so do war games. A common question asked during a
War game is "Are you playing for blood or for fun?" Such players normally prefer games
that allow their skill to be properly brought to bear, so they tend towards games in which chance
plays a minimal role.
Exercise
Exercise is another common motivation to play games. The exercise can be mental or
physical or some combination of both; in either event, the game is an entertaining way to stay in
shape. Some players like to exercise their cognitive skills, while others prefer the use of intuition.
Some players prefer to exercise their athletic skills. Furthermore, players need to exercise their
skills at an appropriate level. A chess player will get very little exercise out of a game of tic-tac-
toe. Similarly, a person who finds tic-tac-toe challenging will get little useful exercise out of
chess. These preferences sort players out and route them to the different games available.
Need for Acknowledgment
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We all need to be acknowledged, to be recognized by other people. The acknowledgment

we crave is not merely an acknowledgment of our existence, but of our personalities. For
example, when we meet a casual acquaintance, we usually get a perfunctory acknowledgment
("Hello there, Suresh.") We are more gratified when the greeting in some way acknowledges us as
individuals with special personalities and problems ("Hello there, Suresh; is that knee still
bothering you?")
This is one reason why interaction is so important to a game; it allows the two
players to acknowledge each other. A truly excellent game allows us to imprint a greater portion
of our personalities into our game-playing.
Summary
Many factors play a role in motivating a person to play a game. The original (and almost
instinctive) motivation is to learn, but other motivations come to bear as well.
MOTIVATION VERSUS SELECTION
We must be careful to distinguish between factors that motivate people to play games in
the first place and factors that allow people to choose between games. In other words, the answer
to the question, "Why do people play games?" can be quite different from the answer to the
question, "What makes one game more fun than another?" Some factors motivate a person to play
games; other factors help that person select a particular game. For example, sensory gratification
is such a selection factor. A player who has decided to play a particular type of game will prefer a
game
With excellent graphics over games with poor graphics; yet the graphics alone will not
motivate many people to play games. Motivating factors get people to approach games in general;
enjoyment factors help them make their choice of particular games.
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STATE OF THE INDUSTRY
As we move further into the 21st century, it’s clear that the future of entertainment is one
in which computer and video games play an increasingly
important role in our society - one in which they change the way people live,
work and play.
In fact, the years 2001 and beyond are shaping up to be watershed years in the history of
interactive entertainment. Leading analysts forecast that video and computer game software sales
alone will soon surpass $10 billion, and that the next generation of video game consoles may
achieve household penetration rates approaching 70 percent, making them nearly as commonplace
in American homes as video cassette recorders. What an astonishing development for an industry
once viewed as a niche business for teenage boys.
Looking forward, the new age of interactive entertainment promises a period where
computer and video game worlds will be more realistic, where we will see characters capable of
engaging our emotions, of making us laugh and cry, of triggering great empathy. Games will do
an even better job of creating the illusion of interacting with real people rather than inanimate
characters. They will present music and sound not just as background noise, but as devices to
create tension or other effects. We will witness the arrival of games where actions are controlled
not by joysticks and mouses, but by our own words. Games will soon give players the ability to
touch, feel, and even smell real life human sensations while engaged in play.
It all adds up to a future in which the industry will only grow in its capacity to capture the
imagination of players with games that involve and engage them, with games that come closer and
closer to fully immersing players in their worlds.
The State of the Industry report that follows offers an in-depth look at the computer and
video game industry through an overview of current trends, a
look back at the industry’s history, and a review of the latest statistics and
industry initiatives. All of these elements taken together give us a clear picture of where computer
and video games are today, and what the future of entertainment will look like tomorrow.
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THEN AND NOW
Brief History
Who would have thought over 25 years ago that computer and video games were going to
so dramatically impact popular culture and the entertainment art form around the world? It is
amazing that in such a brief time the computer and video game industry has truly revolutionized
entertainment. Games now influence films and books, and make use of a wide variety of popular
music and licenses. The industry has also produced advanced technology that offers game players
a rich, immersive interactive entertainment experience, which many find more compelling than
passive art forms like movies and television.
Back in 1975, an agreement between Sears and Atari ignited the growth of the retail video
game industry. Sears gained the exclusive rights to sell Pong to the home consumer, and
consequently Atari’s overall sales reached close to $40 million. This milestone marked just the
beginning of what would shortly become the highly profitable and popular computer and video
game industry.
The modern-day video game industry took shape in 1985 when Nintendo introduced the
eight-bit Nintendo Entertainment System (NES). Soon
thereafter, the 16-bit Sega Genesis was launched, followed by Super NES. In the early 1990s, the
PC game business surged with the introduction of CD-ROMs, falling prices for multimedia PCs,
and the introduction of high-level 3D graphics cards. In 1995-1996, hungry consumers reacted
favorably when Sony PlayStation and Nintendo 64 launched a new generation of video game
consoles.
In 1999 and 2000, the computer and video game industry reached unparalleled heights with
the introduction of new video game consoles. Sega’s Dreamcast was the first 128-bit console and
Sony’s PlayStation 2 consisted of a 300-MHz processor that allowed users to not only play games,
but also watch DVDs and listen to audio CDs. The year 2000 also saw sales in the computer and
video game industry reach $6.02 billion.
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Interactive Entertainment Today
Interactive entertainment has definitely arrived. Television and cinema are no longer the
sole media for entertainment - the Internet, computers and video games have clearly joined these
older passive forms at the center of popular culture today. Where in the past, people gravitated
toward linear forms of entertainment, today’s mainstream media environment revolves around the
theme of interactivity. People today enjoy entertainment they can control, and experiences in
which they are fully involved. In fact, computer and video games have been delivering just this
type of entertainment to consumers for more than 25 years, and with today’s new technologies,
the possibilities for interactivity are endless.
Interestingly enough, as computer and video games continue to permeate popular culture,
there is more and more crossover with other entertainment genres, such as movies, television and
music. Games provide the basis for popular movies such as "Pokemon," "Super Mario Brothers,"
"Final Fantasy," and "Tomb Raider." Likewise, movies, such as "The Matrix," "Time Code" and
"Run Lola Run," use the structure and aesthetics of games to construct compelling story plots.
Television has also joined the clamor for interactive entertainment, allowing viewers to participate
in shows online and determine plot points and outcomes – similar to the experience of navigating
a computer or video game. The sound, lights and feel of the enormously successful television
show "Who Wants to Be a Millionaire" clearly are drawn from the video game world, and the
game based on the show has proven popular as well.
The year 2000 affirmed the durability and maturity of the computer and video game
industry. Coming off 1999, a record-breaking year of double digit growth, the industry remained
stable during what has become widely known as a "transition year." Unlike previous transition
years during which sales have plummeted, sales in 2000 were flat at $6 billion, a strong indicator
of the industry’s inherent strength. Furthermore, video game rentals also rose in 2000, generating
$919 million compared to $880 million in 1999.
The following historical sales figures illustrate the fact that the computer and video game
industry has grown at a strong and steady rate, and will undoubtedly continue to do so throughout
the next decade.
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ONLINE GAMEING FACTS

55 percent of IDSA member CEO said online games are either very or
extremely important to their company’s business strategy in the next 12
months
An equal number believe revenues from online games will not exceed 20
percent of their company's revenues until at least 2004
Source : IDSA annual member CEO Survey
Demographics
The stereotypical image of a video game player - a teenage boy playing alone for endless hours -
is finally fading away as the broadening demographics of
computer and video game players become more widely understood. According
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to a 2000 survey by Peter D. Hart Research Associates, 32 percent of Americans who play
computer and video games are age 35 or older, with a remarkable 13 percent age 50 or over. In
addition, the study showed that 43 percent of game players are women, and that the average age of
these women is 29 years old. Overall, the study revealed that 60 percent of all Americans, or
about 145 million people, play interactive games on a regular basis.
In addition, the IDSA's 2000 Consumer Survey reveals more details about the
ages of computer and video game players.
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The Top Reasons Why Game Players Like To Play Games
Games People Play
According to research from The NPD Group, strategy/role playing and action
games are still the best selling types of games.
When the IDSA polled more than 1,600 households about their views on the
most fun entertainment activity, the popular choice by far was computer and
video games.
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They are challenging (78.4%)
They provide a lot of entertainment value for the money (48.9%)
They are a social activity people can enjoy with their friends (37.4%)
They relieve stress (55.1%)
Below are the ratings given by ESRB to the games released in 2001
ABOUT THE INTERACTIVE DIGITAL SOFTWARE ASSOCIATION
Formed in 1994, the Interactive Digital Software Association (IDSA) is the U.S. association
exclusively dedicated to serving the business and public affairs needs of companies that publish
video and computer games for video game consoles, personal computers, and the Internet.
Association members include the nation’s leading interactive entertainment software publishers,
which collectively accounted for more than 85 percent of the $6.3 billion in entertainment
software revenues generated in the United States in 2001, and billions more in export sales of
U.S.-made entertainment software.
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WORLDWIDE ANTI-PIRACY PROGRAM
The IDSA’s global Anti-Piracy Program is designed to combat worldwide piracy, which is
estimated to have cost the U.S. entertainment software industry billions of dollars every year, not
including losses from Internet piracy. The program’s primary components are policy work,
education, and enforcement—including direct investigation and enforcement actions around the
world and online.
POLICY ISSUES
The IDSA works with government at all levels to make the voice of its members heard on a wide
range of crucial legislative and public policy issues ranging from copyright to First Amendment
protection and Internet regulation.
The IDSA also issued Principles and Guidelines for Fair Information Practices regarding the
online protection of personal data for the guidance of IDSA member companies.
E 3 -- ELECTRONIC ENTERTAINMENT EXPO
Every year, the IDSA presents the highly acclaimed Electronic Entertainment Expo (E 3) the
world’s largest trade show dedicated exclusively to the interactive entertainment industry.
Attendees also participate in educational workshops and seminars. In its eighth year, E 3 2002 is
scheduled for May 22 –24.
ENTERTAINMENT SOFTWARE RATING SYSTEM
The Entertainment Software Ratings Board (ESRB) provides a comprehensive set of ratings for
computer and video games. The ESRB has rated over 9,000 titles submitted by more than 380 of
the industry’s leading publishers. The ESRB, in association with the interactive entertainment
software industry, recently established a self-regulatory unit: the Advertising Review Council
(ARC). ARC is responsible for the implementation, administration and enforcement of advertising
principles and content guidelines for the interactive entertainment software industry.
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SOURCE FOR INDUSTRY INFORMATION
The IDSA is broadly acknowledged as the industry’s leading source for consumer, economic and
other industry data, as well as information on related market trends.
IDSA MEMBERS
Acclaim, Activision, Capcom, Crave
Entertainment, Disney Interactive, Eidos
Interactive, Electronic Arts, Fox Interactive, id
Software, Inc., Infogrames North America,
Interplay Productions, Konami of America, Inc.,
Lego Media International, LucasArts
Entertainment, MGM Interactive, Microsoft
Corporation, Midway Home Entertainment,
Inc., Namco Hometek, Inc., Nintendo of
America, NovaLogic, Inc., Sega of America
Dreamcast Inc., Sony Computer Entertainment
America, Take-Two Interactive, THQ, Inc.,
Titus Software Corporation, Ubi Soft, Inc.,
Vivendi Universal Interactive Publishing
(Havas Interactive), Wild Tangent, Working
Designs, Inc.
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Piracy of computer Games
Software is one of the most important technologies of information age, running

everything from PC’s to Internet. Unfortunately, since it is intangible and can be distributed
from PC to PC, software piracy is common phenomenon.
How piracy is done
Doing piracy is very easy task a person who knows windows can also do piracy
Equipment needed for piracy is only CD writer which has prize from
Rs 3,500 to Rs 10,000 depending on the speed of writing , a blank CD for RS 13 to RS 35 and
CD which contain software(can be use pirated CD )
Original CD === Copy it to hard disk=== writes it on other CD
So If you have copy of software on hard disk or on CD you can pirate it at the expense of
Rs 50 only. E.g. T he original windows software which have price of RS 4,500 can be used for
RS 150
The pirated software run fine on every machine. They work as good as the original
software works. This is the main reason for piracy
Original game CD == Rs 1000 to Rs 2000
Pirated CD == Rs 150 to Rs 400
Status of piracy over the world
In the case of software, it is possible to possess an exact copy of the original at a fraction of
cost. Thanks to the Internet, it is now possible for a pirate in Hong Kong to get ISO rips from
America the very day a game is released. Broadband Internet and the proliferation of CD-RW
drives mean that even the average Joe can get free copies of himself.
And it is not just the software Industry that is being ripped off. The music and the
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movie industries are coming to terms with the explosion of broadband Internet. DivX and MP3
have made it easy for the end user to download digital entertainment without paying his dues. The
recent copyright issues brought against the Napster by the RIAA shows that Internet boom has
opened a Pandora’s Box with regards to copyrights issues.
Computer games have been the victim of piracy since the very beginning.
Back then all it took was the knowledge of DOS commands to make a floppy-clone of the game.
Piracy has grown large since then. According IDSA, the US gaming industry lost $3.2 Billion in
the year 1999.
However, that was just a one-sided figure based on the assumption that
anyone who has pirated software would have actually otherwise bought the software. Whether
these figures stand to be true is a matter of speculation, but it doesn’t undermine the fact that
piracy is the dangerous snake that bites the hands that feeds it.
Commercial game development today takes 2-3 years and the development
projects can go beyond the million dollars. Not all companies have Ferraris in their Parking lot.
Looking Glass going belly up is a sign that game development is not the rosy picture it might
seem. Computer game developers work in an industry where 90% of the profits are made from
10% of the products. Or to put it in other way, 90% of the products simply die in the market place.
Can a market that encounters such low profits survive piracy?
“Who cares!” says Arvind Madhavan, the proud owner of 9 pirated CD’s and
16 games. “The only legal copies of games I have come with my drivers!” He quips. Arvind fits
the demographics of hardcore gamer; on his 20 gig of hard-drive he has Warez and MP3’s that he
never uses. “Look, I am a poor chap and can’t afford even the pirated stuff. Once I start earning I
will write them all a pay check” He says. As is apparent, the allure of free games takes precedence
over conscience and guilt and endows a flexible sense of morals.
Pricing
Retail games face criticism for their exorbitant pricing. A PC game priced
for more that 1,500-2,000 bucks is simply out of the range of average gamer. Most of the new
releases ship at prices above Rs.1, 000/- Many games CD’s are basically imported from open
International market instead of the publisher. When this happens, the prices shoot up. There is
also a general confusion over pricing of titles, while Crossword sells Age of Empires II at
Rs.3599/- many games do not follow a fixed MRP. You can bargain with the retailer to bring the
prices to as low as Rs.3000/-
“I am aware that there are other marginal players who are merely trading
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in this industry. They tend to price their products much higher to make a fast buck, “says Sachin
N, business head at Milestone interactive. To appeal to the money conscious gamer, Milestone
and Eidos have launched a range of “Budget Games” priced at Rs.499/-, featuring some of PC’s
leading titles- Tomb Raider III, Thief, Commandos, Urban Chaos and Fighting Force.
Packaging
But no budget can match the miserly aspirations of the perennially kadka
Indian gamer. A pirated game can be purchased at 150-200 bucks from hawkers in the central
areas and many retail outlets. Theses games lack a decent jewel case or packaging. The quality of
the CDs is infamous and doesn’t win any fans for durability.
“I always back up my games on separate CDs, because
these pirated CDs don’t last forever” says Shyam, gamer\shameless pirate. “Twice I had to go
back and wrangle with the storekeeper because the CDs wouldn’t work. He finally replaced it
after a lot of begging and pleading.”
Authentication Issues
As today’s games shift from Single Player to Multiplayer,
getting away with pirated software will become even more difficult. Central authentication servers
are the latest kind of copy protection software online. You can only play on the Internet when a
special server maintained by the producers authorizes your CD key. Quake III: Arena and Half-
Life use this mechanism. Even though the CD key routine has been pluricracked and key-
generated, the overall idea is to annoy (and mostly deny) people who didn’t buy the game.
Charging a monthly subscription fee of $10 like Everquest might be the taste of the things to
come, where you have to pay before you play.
Pirated Games are Rip-offs
Pirated rips are often music, movies, cinematics or cut-scene; the pirate removes these files to
make more palatable for bandwidth impaired. System Shock 2, released by Class was 119 MB, as
compared to the original 580 MB. The packager converted all the sound files to MP3, stripped all
the movies and zipped all the files using three compression utilities. The Faction’s 10 point
program, a sort of moral code for distributing Warez states that game files should not exceed 144
MBs of compression data.
Released Dates
Retail games have been criticised for shipping their products late. Action and
sports title are known to ship at the earliest, but publishers do not take any special efforts to
release lesser-known titles early.
Retail games cannot even imagine trying to compete with pirating
models like Odey Warez, wherein a game is released on the web the very day the CD comes to the
public. Pirated games reach the Indian shores within a month, usually from South East Asian
Countries. This is not due to any particular efficiency on their part. Shipping beta copies of the
game often helps. “I was surprised to see Half-life on the streets so soon, I bought a copy only to
find it was a demo Day-one CD.” Sobs Arvind.
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Sachin (Milestone) assures us “As regards this release gap, I

think we are now moving toward a situation where we would be able to launch within a week of
the International release date. These things do take time and our relationship with our publishers is
progressing to this level. I can assure you that 2001 will be the different.”
Availability and variety
Another criticism levied upon the retailers that they don’t stock
titles that sell badly in India. The Indian market loves sports, racing and action in that order.
Strategy and RPG titles are ignored. Business works on the basis of supply and demand, both
pirates and sellers stock those titles that sell well. In fact, if you wanted copy of Imperial
Galactica, you won't find any pirates selling it. To bring down the high prices of games,
distributors have released Classic and Budget games, and bundled
be CD's together in Gamepacks. Though most of these titles are at least a year old, it doesn't
bother the casual gamer who usually has a low-end system to complement these games. Games
are available at -Rs. 299, 399, 499, 699 & 999. Many of these gamepacks feature unheard of
games like "Evil Kneivel
3D" and antiquated DOS based games like "Screamer". Budget games may not appeal to the
hardcore gamer, but it gives the casual gamer an opportunity to buy legal copies of his games at
competitive rates. And its all for a good cause. An excess of software piracy leads to higher priced
software. In turn, the higher the price of software, the more likely people will attempt to obtain
pirated copies. A vicious cycle is set in motion, so intervention is necessary to help a prosperous,
fast growing industry to maintain itself.
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ECONOMIC IMPACTS OF THE DEMAND FOR PLAYING INTERACTIVE

ENTERTAINMENT SOFTWARE ON US ECONOMY
Executive Summary
How significant is the overall demand for computer and video games in the U.S. economy?
In 2000, its economic impacts, including direct and indirect economic effects, were:
• Employment for 219,600 people;
• Wages of $7.2 billion;
• Federal and state personal income tax revenues of $1.7 billion; and
• A $10.5 billion market for game software publishing, wholesaling, and retailing, as well as
transporting, wholesaling, and retailing of some, but by no means all, complementary game
hardware.
Demand for computer and video games directly affected the information, trade, and
transportation sectors. In the information sector alone, which is where game software is produced,
the economic Impacts, including direct effects of demand for game software and the indirect
effects of all industry spending initiated by the game software publishing industry, were:
• 124,500 jobs;
• $4.9 billion in wages;
• $1.2 billion in taxes; and
• A $9.3 billion market for game software publishing, wholesaling, and retailing.
In 2000, sales in the game software industry were growing at a rate of 15 percent per year,
more than double the rate of growth of the U.S. economy as a whole and far outpacing sales
growth in related industries. In addition, the software publishing industry devotes 14 percent of it
receipts to research and development, compared to other entertainment industries which devote 9
to 12
percent of sales to R&D. This dynamic industry is bringing improved technology, new types of
games, and new users to the market, generating employment and fiscal revenue across the nation.
Its significance to the U.S. economy will only continue to grow.
22
Introduction
A 2000 survey by Peter D. Hart Research Associates, Inc. found that 60 percent of all
Americans, or about 145 million people, play computer and video games regularly. Leading
analysts forecast that computer and video game software sales alone will soon surpass $10 billion,
and that the next generation
of video game consoles may achieve household penetration rates approaching 70 per-cent by
2005, making them nearly as commonplace in American homes as video cassette recorders.1
Whether people are playing at home on their computers or on the latest “next generation” game
console, or on the road on handheld devices such as Nintendo’s GameBoy, cell phones, or
personal digital assistants, interactive games have an undisputed impact on our culture and
economy.
This report presents estimates of the economic impacts of the demand for computer and
video games. Impacts include direct and indirect effects on sales, employment, wages, and tax
revenues. Direct effects are found in the information, transportation, and trade sectors of the
economy the sectors that produce, transport, and sell computer and video games. Spending by the
information, transportation, and trade sectors initiates spending by other sectors and industries that
generates indirect effects. Such inter-industry spending occurs as an industry buys products and
services of other industries to produce
its product or provide its service (see Figure 1). For example, game software publishers purchase
and use packaging materials, printed documentation, magnetic storage media, and advertising
services, among other things, for the production and sale of game software. In 2000, overall
demand for computer and video games created a $10.5 billion market for game software
publishing, wholesaling, and retailing, as well as transporting, wholesaling, and retailing some,
but not nearly all, complementary game hardware. Directly and
23
indirectly, the demand for computer and video games generated employment for 219,600 people
who earned $7.2 billion in wages and paid $1.7 billion in federal and state personal income taxes
(see Table 1, grand totals). Of the total impact on employment, the total direct effect was 43,000
jobs (see Table 1, total direct effect). These employees earned $2.7 billion in wages and paid $650
million in federal and state personal income taxes. Total indirect effects were 176,600 jobs, $4.5
billion in wages, and $1.1 billion in federal and state personal income taxes.
The information sector of the economy is where computer and video games are produced.
Within the information sector alone the direct and indirect effects totaled 124,500 jobs, $4.9
billion in wages, and $1.2 billion in taxes (see Table 1, information sector subtotal). The direct
effect was a game software publishing industry that employed 29,500 people and paid $2.5 billion
in wages (see Table 1, information sector direct effect). These industry employees paid federal
and personal income taxes totaling $592 million. The indirect effect of
Inter industry spending initiated by information sector spending generated another 95,000
jobs and $2.4 billion in wages (see Table 1, information sector indirect effect). Taxes collected on
the indirect wage effect totaled $575 million.
Consumer and industry demand for computer and video games generated information
24
sector sales of game software totaling $7.8 billion in producer prices (see Table 1, direct effect on
information sector sales).2 These sales consisted of $4.5 billion to the wholesale and retail trade
channels and $3.3 billion to original equipment manufacturers (OEMs), direct to consumers, and
for export. Sales to the trade channels were marked up 33 percent, resulting in a retail market for
game software of $6.0 billion in 2000. A striking measure of the impact of the computer and
video game software publishing industry on the U.S. economy was its 15 per-cent annual growth
in sales between 1997 and
2000. In contrast, over the same period the U.S. economy grew only 6 percent per year and sales
in the motion picture production, distribution, and allied services industry grew 4.6 percent per
year. These and other findings are presented in the remainder of this report. The direct effects of
the demand for computer and video games are presented in Section 2, and the indirect effects and
total economic impacts are presented in Section 3.
25
Direct Effects of Consumer Demand for
Computer and Video Games
The direct effects of the demand for computer and video games are sales, employment, and wages
in the sectors of the economy that produce, transport, and sell game software and complementary
hard-ware.These sectors are information, transportation, and trade, with nearly all of the direct
effect found in the information sector, which is where game software is published. Hardware is
manufactured outside the United States. Hence, the manufacturing sector is not directly affected
by the demand for computer and video games.
SECTORS AND INDUSTRIES DIRECTLY AFFECTED
26
Information Sector
Within the information sector, the industries directly affected by the demand for computer and
video games are game software publishing, on-line information services, and data processing
services, with nearly all of the direct effect found in the information sector, which is where game
software is published. Compared with the direct effect on software publishers, the direct effects on
the on-line information and data processing services industries are negligible (less than one
percent of sector sales). However, these industries are likely to be increasingly affected by the
demand for computer and video games. Why? Because since 1996 a new segment of the market
interactive games played on the Internet — has emerged and grown in popularity. In 2000, there
were approximately 39 million casual online PC gamers, a Number expected to grow to 55
million by 2004. 3 The demand for on-line games from role-playing games like Everquest, Ultima
Online, and Asheron's Call to card, board, and trivia games – will create significant additional
sales in the on-line information services industry in the coming years.
Trade Sector
Within the trade sector, wholesale and retail industries are affected directly by the demand for
computer and video games. To avoid double counting the direct effect on the information sector,
the direct effects on wholesale and retail “sales” are measured as wholesale and retail margins.
These margins are the differences between sales revenue and the cost of sales. Included here are
trade margins on hardware deemed complementary and purchased only for the purpose of playing
games. Specifically, 8-, 16-, 32-, and 64-bit consoles and accessories and portable video hard-
ware and accessories, all of which is manufactured outside the United States, are included.
Although some personal computers (PCs) are purchased for the purpose of playing games,
reported computer sales data do not identify such machines. Hence, trade margins on PCs are not
included here. If included – and it’s notable that IDSA’s annual consumer survey shows that PCs
are used to play games more than for any other application – the direct (and indirect) effects of the
demand for computer and video games would likely be significantly greater than estimated and
presented in this report.
27
Transportation Sector
While truck and air transportation industries are affected directly by the demand for computer and
video games by virtue of their role in delivering packaged game software and complementary
hardware to wholesalers and retailers, available data are inadequate to allow inclusion of software
transportation. Hence, the effects presented here reflect transportation of hardware only — but not
PCs. As a result, direct effects (and total impacts, as well) are understated
MARKET SIZE AND GROWTH
Considering both software and hardware, the market created by the demand for computer and
video games totaled at least $10.5 billion in 2000 (see Table 2, total sales). The total market
consisted of game software sales of $7.8 billion in producer prices, software and hardware trade
mar-gins of $2.7 billion, and hardware transportation costs of $20 million. Growth in that market
is robust. Between 1997 and 2000, the software publishing industry’s game software sales grew
15 percent per year (see Figure 2). In contrast, the U.S. economy grew only 6 percent per year
during the same period. Moreover, game software sales grew at a faster rate than other major
American industries including: motion picture production, distribution and allied services;
amusement parks; consumer electronics manufacturing; and physical fitness facilities
28
(see Table 3). Considering only software, that is,

excluding all hardware trade and transportation
activities, the software-only market totaled $9.3
billion in 2000 (see Figure 3). It consisted of $3.3
billion in
game software sales to OEMs, direct to
consumers, and for export; $4.5 billion in game
software sales to the trade channel; $200 million
in wholesale margin on software sold to the trade
channel; and $1.3 billion in retail margin on
software sold to the trade channel.
29
Looking more closely at the game software-only market, retail sales of game software
totaled $6.0 billion in 2000, a slight decline from 1999 sales of $6.1 billion (see Figure 4). Retail
sales of game software grew at an average annual rate of 11 percent between 1997 and 2000.
Total retail sales in the U.S. economy grew only 5percent during the same period.
30
VALUE ADDED TO THE U.S. ECONOMY
The contribution of any industry to the economy is measured by the value the industry adds to the
economy, a conventional measure that is called value added. The value added by an industry is the
industry's sales minus its cost for products and services purchased from and produced by other
industries. The game software publishing industry purchases packaging materials, magnetic
storage media to store software, and other products and services. The costs of these products and
services, which are produced by other industries and purchased by the game software publishing
31
industry, must be subtracted from the publishing industry's sales to determine its value added to
the economy.
The computer and video game software publishing industry's value added to the U.S. economy
was $4.8 billion in 2000. This figure reflects game software publishing industry sales and
software industry purchases of products and services from other industries. The U.S. Department
of Commerce, Bureau of Economic Analysis, reports these purchases and other inter-industry
trans-actions in the benchmark accounts of the U.S. economy.
EMPLOYMENT AND WAGES
In 2000, the direct effect of the demand for computer and video games was the employment of
43,000 people who earned wages totaling $2.7 billion (see Table 2, total employment and
wages).The game software publishing industry employed 29,500 people and paid wages of $2.5
billion. The average annual wage in game software publishing was $83,700 in 2000. As a result of
the demand for game software and complementary hardware the trade sector employed 13,400
people and paid wages totaling $242 million. These direct effects were found mostly in retail
industries, where 12,600 people were employed and paid $214 million in wages.
The average annual wage of these retail employees was $17,000. Fewer than 100 people were
employed in the transportation sector delivering the hardware that is complementary to game
software and purchased only for playing computer and video games.
Indirect Effects of Consumer Demand for Computer and Video Games and Total
Economic Impacts
To produce computer and video game software and to provide game software and hardware trade
and transportation services, the software publishing, wholesale, retail, and transportation
industries purchase products and services from other industries. These purchases initiate inter
industry spending, spending that is indirectly linked to consumer demand for computer and video
games. The impact of this inter-industry spending the indirect effect of consumer demand for
32
computer and video games combined with the direct effect yields total economic impact.
INDIRECT EMPLOYMENT AND WAGE EFFECTS
In 2000, the demand for computer and video games indirectly generated jobs for 176,600 people
who earned wages totaling $4.5 billion (see Table 5, total).
The inter-industry spending initiated by the game software publishing industry resulted in
an indirect employment effect of 95,000 jobs. The indirect wage effect totaled $2.4 billion. These
jobs are outside the software publishing industry, and accordingly, the average annual wage
($23,500) is significantly lower than the average wage in the software industry.
TOTAL EMPLOYMENT AND WAGE
IMPACTS
The total impact of consumer demand for computer and video games is calculated by adding the
direct and indirect effects of demand (see Table 6). In 2000, the employment impact totaled
219,600 jobs, 124,500 of which were generated in or through the information sector. The total
impact on wages was $7.2 billion, $4.9 billion of which was generated in or through the
information sector.
33
TOTAL FISCAL IMPACTS
In 2000, federal and state treasuries collected $1.7 billion in personal income tax revenues
on the total wage impact of the demand for computer and video games (see Table 7). Direct and
indirect wages in the information sector generated $1.2 billion in tax revenue — two-thirds of the
total tax revenue impact.
This report has presented data that clearly demonstrate that consumer demand for games
has generated significant and positive economic activity in the United States. In the coming years,
this dynamic industry will continue to expand as new technologies are brought to the market and
hundreds of millions of users continue to make games a part of their daily lives. Thus, the
industry’s impact on the American economy will only continue to grow.
34
Computer Games and Its Impacts on Societies Socially and Psychologically
In the wake of media attention surrounding tragic episodes of youth violence, some
observers have questioned whether violent content in video games contributes to aggressive
behavior, especially in children. The most objective reviews of studies on the subject of video
games and behavior have concluded there is no link between video game use and aggressive
behavior in children. And while there are some studies that do purport to show such a link, those
that do so tend to be based on flawed methodology and/or are performed by researchers who have
a predisposition to find a link between violent games and aggressive behavior. In addition, there
are other strong objective indicators that such a link does not exist, as discussed below.
Youth Violence Has Declined As Game Sales Have Risen
Violent Crime, Particularly Juvenile

Crime, Decreased
Dramatically From 1994 to 1999
While at the Same Time
Computer and Video Game Sales
Soared
Perhaps the most compelling counterpoint to the argument that video game use does not
cause violent behavior in young people is the fact that youth violence fell dramatically in the
1990s over exactly the same period that video game use skyrocketed. According to the U.S.
Department of Justice Office of Juvenile Justice and Delinquency Program, between 1994
35
and1999 violent crime among 15-39 year olds decreased dramatically. Further, the data shows that
the biggest decrease (39%) came from juveniles between the ages of 15 to 17. As the chart at left
illustrates, during the same period when juvenile violence was plummeting, video and computer
games surged in popularity and sales. Between 1994-1999, video and computer game sales soared
by 50 percent.
Games Are Sold around the World Yet Youth Violence is virtually Non-Existent in
Those Countries
Many of the games with violent content sold in the United States and some with far more
violence are sold in foreign markets. If these games caused violent behavior, one would expect the
rates of youth violence in these markets to be comparable with those in the United States. In
reality, though, the incidence of youth violence in these foreign markets is considerably lower,
and in fact, does not even approach the levels in the United States. Why then is violent crime
among juveniles much lower in foreign markets that sell identical video game products?
Most Objective Studies Find No Link between Video Game Play and Youth
Violence
The most objective and methodologically sound studies of video game play and aggressive
behavior find no link between the two. Perhaps the most compelling and direct evidence of this
can be found in two studies whose primary purpose was to objectively review existing research on
the subject and subsequently form an overall conclusion as to whether media and games can be
linked to aggressive behavior. Both studies, one conducted by the United States Surgeon General
and one conducted by the Government of Australia, found no such link.
Entertainment software rating board
Adults are capable of deciding what video games they should buy and play. Children are
not. Parents must have sufficient information to determine whether any game is appropriate for
their children. The computer and video game industry provides that information. Here is how the
industry is upholding its responsibility to help parents make informed choices.
36
The Entertainment Software Rating Board (ESRB)
The Entertainment Software Rating Board (ESRB) is an independent, voluntary ratings

system for computer and video games established by the Interactive Digital Software Association
in September 1994. Since its formation, the ESRB has rated more than 7,000 computer and video
game titles.
ESRB is also counseled by an advisory board composed of experts in the fields of

academia, consumer rights, children’s advocacy, and education. The board provides guidance and
insight about the effectiveness of the system. The ESRB has set up a toll-free number that has
received more than 1.5 million calls for information on the ratings since they were established in
1994. ESRB also operates a web site (www.esrb.org), offering millions of consumer’s instant
access to information about ratings, including rating descriptors, news and information, a parents’
guideline and an overview of the ESRB.
How Titles Are Rated
Ratings fall into five age-based categories: Early Childhood (ages 3+), Everyone (ages 6+),
Teen (Ages 13+), Mature (ages 17+), and Adults Only (limited to those ages 18 and older). ESRB
is the only ratings system that goes beyond age to include short phrases called descriptors that
provide detailed information on content. The descriptors fall into several categories, including:
violent content, sexual themes, language and others, such as drug use and alcohol use. The ESRB
rating system is based on the prior review of actual product content and other materials by three
raters randomly chosen from a pool of 100 demographically diverse individuals from all walks of
life. Based on extensive training, these raters assign a rating and appropriate content descriptors
after reviewing a range of materials, including the most extreme content of the product. Thus, the
ESRB ratings represent the views of typical consumers with no ties to the industry, exercising
their independent judgment on how a title should be rated.
37
What Consumers Think About the ESRB
The system receives positive reviews from those who count most: parents. According to a 1999
study by Peter D. Hart Research Associates, 80% of Americans who were explained how the
ESRB system works said it would be “helpful” or “very helpful.” In a separate July 2000 study,
Hart Research Associates conducted mall-intercept interviews with 410 adults nationwide,
including 246 parents who were shown videotapes of game clips and asked to rate them based on
the ESRB standards. The survey found that “in 84% of all instances, games are rated equal to or
less strictly than the official ESRB rating.” Hart found that the ESRB is “twice as likely to be
more conservative than the public” in rating decisions. With respect to the content descriptors, the
survey found “participants are generally in agreement with the ESRB on violence descriptors, and
in instances in which there is disagreement, they are usually less strict than the ratings board.”
Also in the 1999 survey by Peter Hart, 75% of those surveyed said that parents not government or
game makers bear the primary responsibility for monitoring the computer and video games their
children play.
Spreading the Word
In Fall 1999, the ESRB launched an annual national campaign to promote awareness and use of
its rating system during the holiday season. The campaign, which urges parents to “check the
rating,” included a public service announcement featuring professional golfer Tiger Woods; paid
advertising in national publications, including Newsweek, People, U.S. News and World
Report, Parents, Parenting, Good Housekeeping, and USA Today; and relationships with
prominent national organizations like the PTA, YWCA, YMCA, Child Welfare League of
America, Mothers Against Violence in America, Children’s Television Workshop, and the
Children’s Television Resources and Education Center.
The ESRB released a new public service announcement (PSA) in Spring 2001 featuring
New York Yankees’ All-Star Derek Jeter urging parents to “check the ratings” before they buy
video and computer games. This PSA is airing in stores around the country, and has generated
nearly ten million audience impressions so far on more than 50 television stations, including both
cable and broadcast outlets. IDSA and ESRB have also encouraged retailers to provide
38
educational materials to in-store shoppers and to make their best efforts not to sell games rated
“mature” to children under the age of 17. To date, major retailers such as Toys ‘R’ Us, K-Mart,
Wal-Mart, Target, Circuit City, Staples, CompUSA, Babbages, Funcoland and Electronics
Boutique have agreed to participate in this effort in some way.
Where India stands
India still playing the waiting game
The computer gaming industry worldwide is a vibrant multibillion-

dollar affair and growing at a rapid pace. India’s small-change in
comparison. what’s keeping Indian computer users from coming out
to play and why our software developers aren’t scoring high in the
gaming ring
The 80s witnessed the Reagan vs. Brezhnev Cold War, the 90s were dominated by Bush Sr
vs. Saddam, while 2001 saw Dubya pitted against a certain bin Laden. Many hope that in 2002 the
real battle would not be fought across continents, but only across consoles and monitors with
joysticks and mouse replacing Stingers and Howitzers as the missiles. The computer gaming
industry, estimated at $8.6 billion worldwide in 2001, looks set to come of age in 2002 and grow
up to $28.3 billion by 2004-05. However, in India, gaming is currently emerging as an industry
variously estimated at between only Rs 20 crore and Rs 40 crore.
Though DOS-based games like Pacman and Carmen were popular during the 80s, the
gaming industry per se started in India only around 1995, coinciding with the launch of
multimedia PCs.
39
Up to now the entire industry has been a

mere mish-mash of pirated games and sundry
amateurish indigenous efforts at creating local
offerings. But why did gaming take so long to
JAYANT SHARMA of Milestone emerge as an industry in India?
says that the cultural mindset
has prevented the gaming industry
from proliferating faster in India
The main reason is the cultural mindset, feels Jayant Sharma, CEO, Milestone
Entertainment, one of the pioneering games vendors in the country.
For a lot of people in India, ‘computer games’ and gaming are still restricted to furtive
sessions of Solitaire or FreeCell on the office computer, a finger hovering nervously over the
‘close program’ button. There is also a basic mindset that gaming is a waste of time and meant
only for children. Internationally, though, games are something of a social sport, with online role-
playing games that have massive subscriber bases, gaming tournaments and professional gamers’
leagues.
Gaming software is emerging as one of the fastest growing components of the
entertainment industry worldwide and it is high time India too cashes in on the opportunity by
developing it as a new segment of its software industry. India’s software industry has annual
exports of around $6 billion and nearly 20 percent of the global market share in customized
software. However, the country is nowhere when it comes to games development. India is not
even on the radar screen today. It is estimated that close to 150 million people regularly play
computer games worldwide and around 215 million games were sold in 2001 alone. This means
that every home in the US had more than two games. Therefore, Sharma feels there is a huge
opportunity waiting for India to tap in the gaming industry.
Slow off the blocks

40
But apart from the cultural mindset, there are several other factors that inhibit the
emergence of a gaming culture in India. Cost of technology is one issue. High-end PCs needed to
play complex games could cost between Rs 30,000 to 50,000. In addition, India lacks a game-
development fraternity that could create culturally suitable games. Gaming parlours and arcades
are also largely lacking in this country.
Gradually, as barriers drop, the situation in India too is likely to change, Sharma says. Cost
of technology is dropping, people here are becoming more technologically aware, and they also
want newer forms of entertainment. In India, popular games could cover a wide range of
possibilities, from role-playing and adventure to simulation, sports, war games and “edutainment”
that blends learning and playing.
According to Sharma, international franchises like Tomb Raider, Unreal Tournament and
the Quake series are very popular as are games built around sporting personalities like Brian Lara
(cricket), as well as film franchises. The popularity of the Lara Croft in Tomb Raider resulted in
the movie doing particularly well in India last year. Nearly all Indian gamers prefer a more
‘instant gratification’ gameplay dynamic as compared to a more stratified, immersive, deep
experience. A problem facing computer gamers in India is that games, especially the more popular
ones, are often imported by multiple distributors, making the prices rather arbitrary. Sharma
agrees that there is a lack of consolidation, “Unfortunately this is still an unorganized industry and
a lot of our ‘competition’ is still doing unofficial imports. But this is not sustainable, as the
products we import tend to be the most attractively priced. Others have to price their products
higher since they are not buying from the publisher in the first place.”
Milestone has partnered with six of the main global game developers. These include names
like Activision, Codemasters Software, Eidos Interactive, Infogrames, Novalogic, Ubisoft
Entertainment, Sony Computer Entertainment, Electronic Arts and VBSoft among others.
Consequently, the games included in the Milestone roster are Tomb Raider, Code Master, Brian
Lara Cricket, Novalogic, Rainbow series, part of Red Storm, which was bought by VBSoft. Other
leading gaming vendors in India include Gayatri Impex, Sujata Infotech and Padmini Multimedia.
41
Competitive pricing
Vendors like Milestone are also leading the drive to make game prices more competitive
and affordable. This is done by means of purchasing older catalogues from global developers,
which are 2-3 years old. Reasons Sharma, “This ensures that it is not too old and since it is
already back-dated for the Western countries it is also priced cheaper.” Milestone has brought the
prices down from a level of Rs 1,500 to somewhere in the range of Rs 299 and Rs 399. It has just
released Quake at Rs 999, which earlier cost Rs 3,000 and Sharma reveals that the company will
soon release Quake Ultimate which includes Quake I, II and III at only Rs 999.
Piracy of games is rampant in India, with titles selling for as little as Rs 125 barely a week
after their international release. It is estimated that for every one unit of legitimate software there
are over 10 units of pirated products sold. In value terms, the piracy market could be as high as
two to three times that of the legit market. Distributors like Milestone are attempting to reduce
losses by making games more affordable. This is vital, because as Sharma admits, distributors are
getting hit more by consumer-level piracy.
The price difference is also slowly eroding. With the release of customized budget packs,
which feature three to six popular games (albeit slightly older versions) for less than Rs 1,500, the
value proposition for purchasing legal gaming software suddenly makes a lot of sense. And while
the relatively small size of the Indian market makes it unattractive to most game publishers, some
like Electronic Arts are more proactive. This could be because EA Sports (a brand of EA) is the
top publisher of interactive sports content and sports as a genre is very popular in India. Milestone
has been trying to convince the publishers it is associated with, that India could grow to be a
volume-driven market, though per-unit values may be lower.
Gaming platforms
What about the availability of the different gaming platforms in India? There are numerous
opportunities for cross-platform conversion between the PC and next generation consoles like
Microsoft Xbox, Sony PlayStation, PlayStation 2, Nintendo GameCube and Game Boy. This
throws up opportunities like developing the “Indianised” version of top-selling international
games on these consoles. However, Sega’s attempt in 2000 to launch its console Dreamcast in
India fell flat. Nevertheless, Milestone has now gone ahead and launched the PlayStation with
Sony in India.
42
In addition, Milestone is planning to launch PlayStation 2 in the near future. Also both
Xbox and Nintendo are expected to arrive in India by 2003.
Explains Sharma, “The fact that PlayStation 1, which

is obsolete in most countries in the West, is being
launched here now proves we have still a long way to
go. But in the next fiscal year PlayStation is likely to
contribute to 33 percent of our revenues.”
In India, till now there has been no culture of
SUDHIR MATHUR of
consoles. But there is a gradual realization taking
Arena Multimedia is place that PCs are not user-friendly for gaming.
of the view that India
can contribute significantly
to the international
games development scene
Because India has not had consoles, distributors here have been selling racing games,
sports, etc, for the last few years instead of first person shooters (FPS), arcade games and sci-fi
theme games.
Game development
On the game development front, precious little has been happening in India, barring stray
initiatives by outfits like Indiagames, with Quake clones such as Yoddha and Chakravyuha. One
of the reasons for this deficiency could be the inadequate training facilities available till date. But
things are changing now with both Milestone and Arena Multimedia tying up with software
vendors like Discreet for imparting training on games development. This requires knowledge of
complex software like 3ds Max and Maya. Milestone already has a full-fledged game
development team in place. However, it does not intend to build its own game engine right now.
So it just licenses the engine which is suited to a gaming idea of its interest and commissions the
coding in terms of linking vehicle behaviour in different scenarios.
Sudhir Mathur, head, Arena Multimedia, feels that India can emerge as a strong provider of
43
content or programming resources. He believes, “Game development is one area where India can
seriously contribute to the international market. We have some pretty talented artists, 3D
modellers and programmers, who, if given the right kind of tools and resources, can create
outstanding quality content.”
A good example of a gaming success story is Starcraft that surpassed all expectations by
selling over a million copies in Korea, hitherto not a huge market for computer games. The
Starcraft craze in Korea even helped the developer Blizzard license the game’s characters out for
products ranging from action figures to breakfast cereals. Sharma feels that several games have
the potential “to do a Starcraft” in India but obviously on not as large a scale.
Indian software experts to help British develop computer games
Indian Software experts are coming in increasing numbers to Britain to help the British
develop and play computer games, according to a report by Britain's Screen Digest. Britain has
the third largest market in computer games after the US and Japan, with a much smaller
population than those two. The computer games market doubled in 1999 from 1996, with about
36 million games sold. Britain has a population of 57 million. The computer games market has
topped a billion pounds and, at the current pace, is growing at about 20 per cent a year. But
Britain does not have expertise to develop new games and that is where Indian software specialists
are coming in.
"Whether it comes to animation or to computer games, we have many more people from
India now getting into the scene here. This is no more about Indian wizards working on complex
backend solutions," an Indian official told IANS. The big players in the business are Sony, Sega,
Microsoft and Nintendo. Indians are joining these firms in Britain and also other smaller firms
that hope to develop their own games.
Many British companies are spending millions on developing computer games, with some
of them spending more on this than the budget of a major film. The business is taking
encouragement from the findings in the report that people do not grow out of computer games.
More people in the age group of 25 to 34 play computer games in Britain than people in the age
group of 15 to 24.
This may be start of new opportunities available for Indian software developers
44
Miles to go
Though Sharma and Mathur sound bullish, it is true that there are many hurdles before the
gaming hobby can gain mass acceptance. The cost of the technology is pretty steep. Secondly,
there is a problem of accessibility: there just are not enough places that provide an immersive
experience that can have a long-lasting impression on the people that try it out. Thirdly, there is a
mental perception that gaming is an activity meant only for kids. There is an apprehension
towards the technology involved in gaming. Lastly, we don’t have any cultural influences or icons
that we can identify with in the games we play. For instance, Star Wars and science fiction is a
part of American culture and games based on these influences have that instant connection with
gamers in the US. In India, developers would perhaps have to think of concepts centred on our
ancient mythology and indigenous cultures. Serious gaming in India has only been around for the
last six or seven years, though it has been very popular in the West since the early 80s. There is
still a while before we will see an exponential rise in the volume of sales.
45

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www.ManagementJuice.

com Computer Gaming Industry – Himans hu Ahire

Why game industry?

• The average age of a game player is 28 years old.

• 43% of game players are women.

Computer Games and its different types

Basic Game Genres

FOLLOWING ARE THE BASIC TYPES OF COMPUTER GAMES

The Gaming Family Tree

ACTION STATEGY ROLE

SIMULATION ADVENTURE SPORTS

A common function of games is to provide a means of overcoming social restrictions, at

Need for Acknowledgment

We all need to be acknowledged, to be recognized by other people. The acknowledgment

MOTIVATION VERSUS SELECTION

STATE OF THE INDUSTRY

THEN AND NOW

Interactive Entertainment Today

ONLINE GAMEING FACTS

Source : IDSA annual member CEO Survey

The Top Reasons Why Game Players Like To Play Games

Games People Play

They are challenging (78.4%)

They provide a lot of entertainment value for the money (48.9%)

They relieve stress (55.1%)

ABOUT THE INTERACTIVE DIGITAL SOFTWARE ASSOCIATION

WORLDWIDE ANTI-PIRACY PROGRAM

E 3 -- ELECTRONIC ENTERTAINMENT EXPO

ENTERTAINMENT SOFTWARE RATING SYSTEM

SOURCE FOR INDUSTRY INFORMATION

Piracy of computer Games

Software is one of the most important technologies of information age, running

How piracy is done

Original CD === Copy it to hard disk=== writes it on other CD

Original game CD == Rs 1000 to Rs 2000

Pirated CD == Rs 150 to Rs 400

Status of piracy over the world

Pirated Games are Rip-offs

Sachin (Milestone) assures us “As regards this release gap, I

Availability and variety

ECONOMIC IMPACTS OF THE DEMAND FOR PLAYING INTERACTIVE

• Employment for 219,600 people;

• Wages of $7.2 billion;

• $4.9 billion in wages;

• $1.2 billion in taxes; and

Direct Effects of Consumer Demand for

Computer and Video Games

SECTORS AND INDUSTRIES DIRECTLY AFFECTED

MARKET SIZE AND GROWTH

(see Table 3). Considering only software, that is,

VALUE ADDED TO THE U.S. ECONOMY

EMPLOYMENT AND WAGES

INDIRECT EMPLOYMENT AND WAGE EFFECTS

TOTAL EMPLOYMENT AND WAGE

TOTAL FISCAL IMPACTS

Computer Games and Its Impacts on Societies Socially and Psychologically

Youth Violence Has Declined As Game Sales Have Risen

Violent Crime, Particularly Juvenile

Entertainment software rating board

The Entertainment Software Rating Board (ESRB)

The Entertainment Software Rating Board (ESRB) is an independent, voluntary ratings

ESRB is also counseled by an advisory board composed of experts in the fields of

How Titles Are Rated