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The Dark Side of the Online Gaming Industry in India

Professor of Financial Economics and Part-time Value Investor, Transfin.
Apr 14, 2020 7:46 AM 2 min read
Editorial

The novel coronavirus pandemic has pushed the global economy in a tailspin and gutted multiple industries including aviation, tourism, hospitality and others.

 

However, some like the fitness industry, which has gone virtual only in a matter of days, have managed to remain afloat. Some others like the online gaming industry have, in fact, succeeded to shine amidst the chaos, with many touting them as “recession-proof”.

 

With billions of people across the world confined to their homes in the wake of nationwide lockdowns, online gaming has emerged as a prominent source of entertainment - for kids and adults alike. 

 

 

PC/console and mobile gaming platforms have been caught unawares, often struggling to keep up with the unprecedented surge in demand. 

 

On March 15th, several Microsoft Xbox Live users took to social media commenting that they were unable to log-in to their Xbox consoles. The issue was fixed a couple of hours later. However, five days later, the service went down again. 

 

Indian online poker room PokerBaazi, for instance, reported 25% rise in traffic in recent weeks, with transactions also rising by 20%.

 

The rising popularity of the gaming industry, particularly online gaming, is credited to the availability of cheaper smartphones, better internet connectivity and increasing use of digital wallets and payment platforms. 

 

However, as per this intriguing Livemint report, there’s a fourth tool now available to the gaming industry, one they’re particularly hesitant to talk about. It is the gamer’s data - when you like to play, who you lose to and win against, how much money you spend, the tables at which you like to sit, and how you respond to changes in gameplay.

 

This gamut of data allows platforms to identify their frequent and valuable customers and target them over others with offers, bonuses and promotions. 

 

And deployed effectively, this data could take a potentially addictive product and transform it into something irresistible!

 

FYI, we delved into the often-ignored dark side of the gaming industry - overtime, no extra pay, cyclical lay-offs, and generally dubious labour conditions - in one of our podcast episodes. Listen in for the full scoop.

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