•  Animation and Gaming offer India potential growth opportunity
•  Animation is a $950 million opportunity for India by 2009
•  Game-development to generate $300 million for India by 2009
•  Indian Animation & Gaming: Moving from non-existent to high growth market

The latest report on Animation and Gaming industry in India by NASSCOM, 900-member industry body representative of India's information technology companies, reveals a huge growth potential in both the animation and gaming industry in India, with revenues expected to reach $1.25 billion by the year 2009. The report estimates the global market size (demand perspective) of industry will witness a cumulative annual growth rate (CAGR) of 8% and is expected to reach $75 billion by 2009. Based on this, the global animation market (from the developers' perspective) is expected to increase to $35 billion by 2009 from $25 billion in 2005.

The Indian animation market (from the developers' perspective) was estimated at $285 million in 2005, according to the 'NASSCOM Study on Animation and Gaming Industry in India'. It is expected to witness a CAGR of 35% from 2005-2009 and increase to $950 million by 2009. According to the report, the market for gaming is expected to witness a CAGR of 78% and reach $300 million by 2009 from $30 million in 2005.

With international entertainment companies such as The Walt Disney Company, Imax Corporation, Warner Bros. Entertainment, Universal Studios, The Cartoon Network, Sony Pictures Imageworks Inc. and Sony Corporation signing contracts with Indian animation companies, local animation design studios are gradually establishing their credentials overseas and building skill sets. Companies such as Hyderabad-based DQ Entertainment have more than 700 animators making cartoons, television shows and full-length animated features for clients like NBC Universal, Walt Disney and Mattel, Inc. India now has more than 100 Indian animation companies and the list is growing. High labour costs in US and Europe have forced even the largest production houses to source their production work from Asian countries where jobs are accomplished at one-fourth the price.

The NASSCOM report says that with the growing business in animation and gaming an emerging trend that can be seen in the market is a number of Indian companies adopting a co-production business model from an outsourcing model. India is expected to position itself as the top destination for animation work with its bank of design and animation talent.

Indian companies' must also cope with the shortage of talent in the short term. Many Indian animation companies are conducting special short-term courses for their employees with the help of foreign experts.

The NASSCOM report highlights the fact that the growth of the mobile industry has led to a rise in demand for the gaming industry as well. Games developed in India have been successful internationally and therefore, are enhancing India's image as a country with the technical and infrastructure capabilities to provide gaming-related services that meet international standards.

NASSCOM's President Kiran Karnik believes that India's IT expertise and creative skills, combined with the entrepreneurial drive of its companies, make it well positioned to tap the potential of this growing global industry. He says, "the rapid growth of mobile telephony, increase in personal computers and the greater use of animation content will fuel the growth of the domestic market too."