The global gaming industry which comprises game developers, service providers (outsourcing companies that help with art creation, testing, localisation, audio, visual effects etc.), and hardware manufacturers is currently pegged at over $100 billion globally. Gaming is the largest segment within the Entertainment industry, far exceeding Movies (Hollywood + Bollywood), Music & Animation across the world.
Lakshya Digital has been a pioneer in the Game Art outsourcing business and has been working with some of the biggest names in the space over the last decade and has developed art for some of the biggest game titles globally in its studios in Gurugram and Pune. Lakshyaâ€™s client list includes Disney, Microsoft and Sony among others. Kingdom Hearts 2.8 from Square Enix, Sea of Thieves from Rare Studios, Just Cause III from Avalanche Studios, are hugely popular titles that Lakshya has worked on recently. Lakshya is a part of Dublin-headquartered Keywords Studios.
In India, while the industry is at a relatively promising stage and China has been in this business for far longer and is currently the number one globally in sales, India is being looked at increasingly as a viable alternative for global game art development.
In an interaction with TNM, Anando Banerjee, Head of Production, Lakshya Digital discussed the concept of gaming process outsourcing, what it entails and why India is emerging as a major GPO hub, among other things.
Here are excerpts.
What is Gaming Process Outsourcing?
Gaming Process Outsourcing (GPO), as the name suggests, is the outsourcing of different â€śprocessesâ€ť (each â€śprocessâ€ť can be considered to be a group of allied activities) that are required for the development of a game, to third party companies which are specialised in those processes. Some of the processes involved in Game development that are outsourced to third party companies specialising in that particular process are audio creation, art creation, programming, testing etc.
Video games combine key elements like art, design, code and audio to create complex but exciting interactive entertainment products. The development cycle includes many different activities and is typically divided into three stages viz. pre-production, production and post-production. Pre-production involves activities like game design, concept art creation and prototyping. The major development work takes place in the production phase which includes creation of art assets, level creation, programming, audio creation and testing. The post-production phase mainly consists of activities like bug fixing, localisation and maintenance. It also involves the creation and release of additional game content in the form of Downloadable Content or DLC. Game Development is a complex process and development budgets for video games often run into tens of millions of dollars â€“ and requires large teams of highly skilled people. Outsourcing helps to overcome many of the challenges associated with cost and talent.
How big is the GPO space in India and does India have the potential to become a GPO hub?
The Indian gaming industry is currently valued at over $890 million (approximately Rs 6000 crore) and accounts for roughly 1% of the global gaming industry and is poised to become one of the worldâ€™s leading markets in the gaming sector. India got off to a very slow start in the business of outsourcing of game development and got a foothold barely a decade and a half back, around the same time when Lakshya was formed. However, India has done extremely well since then and inched very close to China, which has been the dominant player in this space. The growth potential of GPO industry is much similar to the BPO industry in India, and owes much to the availability of a large trained talent pool in the country at competitive rates. There are additional reasons like familiarity with the English language, inherent cultural flexibility of Indians and their ability to quickly absorb and engage with people of other cultures.
Outsourcing has allowed Indian game developers to get exposure to work with some of the best creative talent in the world, pick up new skills and work to international standards, which has helped in creating a solid base for future home-grown game development companies. If one has any doubts about the quality of game development talent in India, one might want to look at the fact that top international studios such as Electronic Arts, Ubisoft, Rockstar and Zynga have already set up development centres in India.
With the worldâ€™s largest population of youth (two-thirds of our 1.3 billion people are under the age of 35), abundant talent in programming and art, technical and creative skill sets and a professional aptitude to meet international game development needs at competitive costs, India has already begun its journey to becoming a GPO hub.
How does India compare with China in game art development?
There are a lot many more service providers in China. That happened because multinationals went into China first and their ecosystem supported them better. So they got in first and the Chinese market itself developed faster. But most of them are small. We, Lakshya, are possibly the only art outsourcing studio that has done well not just in North America and Europe but also in Japan. We service Japan which is a very difficult market. Chinese studios have tried but with limited success. We are the number 1 non-Japanese service provider in Japan as far as art is concerned. The Chinese started earlier and they had the initial momentum but I think we have done extremely well to not only catch up with them but to overtake them. There are no real numbers to compare but definitely Lakshya stacks up very favourably with any Chinese studio that you can pick up.
Is there a huge gap between demand and supply?
There is. So, itâ€™s not just the art outsourcing studios. There are multinational gaming firms that are in India who have studios in India and their requirement is growing as well. They are seeing value in sending more work to India. So our artists are among the best trained in the business because of the project profiles that we have. We take on complex projects, not every one in the market takes on complex projects. More people opt for mid-range projects because they are easier, not enough edit, quote a little lower etc. But we go out and take the most complex projects and hence as a consequence, we are one of the best trained. The problem for us is that everyone targets us to recruit. Our artists can walk into most studios and get a job and there is constant pressure on the industry because people poach.
In game art development, what is the biggest challenge?
I think talent is the biggest challenge. Opportunities are there but we donâ€™t always have the right people. We have been constrained by the lack of adequate trained people. But, we are getting there. And there are lots of initiatives all round and weâ€™re part of one of those initiatives, the Govt. of India Gaming Council. One of their focus areas is game art and we are actually subject matter experts to them. We are collaborating with the government on the National Skill Development Council (NSDC). There are also private players who are coming in looking to develop this area and then there are players like us who have their own academies. So there is a lot of focus on skilling and developing the ecosystem and in a couple of years, weâ€™ll see the results.
How do you see this industry going forward?
I see huge opportunities because like I said, this industry is growing at a pace that is really admirable. I see perhaps somewhere down the line, new technologies like AR/VR getting to a point where they can be leveraged for games. Right now, the hardware is still not there. The hardware is still one or two generations away from mass adoption. Nowadays, you can get console-like graphics on mobile phones. So technology is one of the things that is driving this forward, but so is the growth of new markets like China and India. What has also happened is that the market has got a lot more democratised.