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Sat, Sep 24, 2005 - Page 12 News List

India vies for share of growing market for cellphone games

AP , BANGALORE

Rajesh Rao, a 34-year-old businessman, spends a good part of his workday playing video games on his mobile phone. He also insists his new employees spend their first few weeks doing the same.

He's not a flippant amateur refusing to grow out of his childhood. Instead he's part of a small breed of entrepreneurs trying to make India the world's studio for developing games on mobile phones, computers and consoles.

They're already attracting big names and big money, leveraging the same advantages that India's software industry uses: abundant programming skills and low wages. They compete for outsourced game development work from the West while also creating their own games.

But while multinational game developers such as Sony Corp, Codemasters Software Co, Atari Inc and Microsoft Corp are rushing to offshore development work, Indian companies find it hard to hire creative programmers who understand and enjoy games.

"Very few Indians grow up playing games, because they're too busy with studies and thinking about their future," Rao said. "We let our new employees just play games for the first two or three weeks, so that they will get hooked."

US video game sales alone are estimated at US$10 billion a year, but the cost of developing new games for console systems in the US can surpass US$10 million.

That's why analysts say India is likely to become an attractive option for at least part of the process, such as art design. Cost savings in India could amount to 40 percent, industry insiders say. For mobile phone games, the savings could be up to 50 percent, given the work required to achieve compatibility on multiple devices.

"Our real advantage is that we can combine low costs with abundant creative talent and programming skills that can be tapped here," said Rao, whose company, Dhruva Interactive, based in the southern technology hub of Bangalore, completed a project for Microsoft this year and launched its own tennis game for mobile phones in May.

Game offshoring to India began in 1998, with Dhruva winning a commission for a portion of the "Mission: Impossible" game.

But the first big recognition for India's emergence as a game developer came more recently. Last December, Chinese wireless Internet company TOM Online acquired the majority stake in a company called Indiagames for US$17.7 million. Cisco Systems Inc and Macromedia Inc followed in April, together investing US$4 million in Indiagames for 18.2 percent ownership.

Indiagames develops more than 30 games a year for mobile phones. It is constantly bidding on licenses to use the names of celebrities, cartoon characters and movies, so it can piggyback on the popularity of those names and become visible in the global market.

Another outsourcing company, Bombay-based Small Device Technologies, focuses on making games work on different handsets. CEO Dikshant Dave said it would cost US$100,000 in the US to make a game compatible with 60 or so phone models -- a figure that can be cut in half in India because of lower wages and operating costs.

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