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Indian animation industry is expected to record USD1163 million by 2012, as against USD460 million, reporting a CAGR of 27 per cent,according to a report jointly prepared by NASSCOM and Ernst andYoung. The report, christened Indian Animation and Gaming 2008, divided the animation market into entertainment USD120 million, education USD53 million, custom content development USD187 million and multimedia/web design USD100 million.
While it had projected an annual growth rate of 40 per cent for education segment, the gaming industry is poised to grow at a CAGR of 50 per cent.
With all the groundwork already in place, the domestic animation and gaming industry is on the threshold of growth. With improved skill set and the ability to develop and produce high quality work, the industry has moved up the value chain, Ernst andYoungs National Leader Media andEntertainment Practice Farokh Balsara said.
He further added that with the change in the intellectual property ownership, the rights of animation will be retained by the developers enabling them to exploit alternative revenue streams like merchandising and sale of digital platforms.
Though the players in the animation and gaming sectors are bullish over future opportunities, they need to address some of the vital challenges like quality manpower, high attrition rates, cost of consoles, lack of bandwidth, acclimatizing the people about original IP internet protocol, lack of content variety and dependence on outsourcing, the report pointed out.
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