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Online games market in India forecasted to exceed $200 million in 2010

For Immediate Release

San Francisco, CA, April 18, 2006 - Pearl Research forecasts the online games market in India will exceed $200 million in 2010. These findings are contained in the "Online Games Market in India" report published by San Francisco-based Pearl Research, a leading business intelligence and consulting firm that specializes in the interactive entertainment and games market. The "Online Games Market in India" is one of the first studies to track and analyze the emerging games market in India.

Allison Luong, Managing Director of Pearl Research, commented, "While long dormant, the online games market in India is starting to heat up. Conservatively, Pearl Research expects the Indian online games market to exceed $200 million in 2010. India in 2006 is often compared to China in 2001, when China's games market started to develop and an online games culture started to form. Within a decade, India has the potential to emerge as one of the top online markets in Asia, along with China, Korea and Taiwan."

"I believe the adoption of online games in India is inevitable as gamers, online publishers, telecoms, Internet cafe owners, and PC hardware manufacturers, all with a vested interest in growing the market, help nurture a games culture," said Allison Luong, Managing Director of Pearl Research.

Other key findings:

- The online games market in India is being driven by the rapid adoption of the Internet with 39 million current users; increasing broadband penetration; growth in Internet cafes with more than 100,000 outlets; and a sizable middle-class with rising disposable income. Most importantly, game operators are promoting and educating consumers about online games including MMOGs.

- There were 39 million Internet users in India in 2005, a 54% YOY increase. The number of Internet users could exceed 100 million by 2007, making India the second-largest Internet market in Asia after China.

- In addition, there were more than 100,000 Internet cafes in India in 2005. Internet cafes can derive 30% to 40% of revenues from users playing games. Games are a "sticky" activity thus users tend to spend more time and money at Internet cafes that offer games. The latest trend is the opening of gaming-oriented cafes such as Sify's Gamedromes to satisfy the growing demand for games. Internet cafes with broadband connections and fast PCs are increasingly replacing many of India's outdated Internet cafes that use dial-up.

- Both local and international publishers are increasingly investing in the Indian online games market, as online games represent one of the few viable publishing models in a country where software piracy rates exceed 85%. In 2006 and 2007, Pearl Research expects several prominent international publishers to enter the Indian online games market either through licensing agreements or joint-ventures. Certain online publishers believe it is critical to establish a presence in India, in order to capture consumer loyalty, develop brand equity and help define the market, before the market becomes saturated.

While the online games market in India has clear potential, there are significant market inhibitors that are detailed in the "Online Games Market in India" report.

The "Online Games Market in India" report contains an executive summary of the online games market in India; discussion of the growing middle class; market forecasts; key metrics such as the size of the online games market in India, number and growth in Internet users and broadband penetration; inhibitors and drivers to the growth of online games; analysis of key online game publishers and their marketing strategies; a comparison of China versus India; "Chindia" strategy, and conclusions. To inquire about this report, please call (+1) 415-566-8509 or email research@pearlresearch.com.


About Pearl Research

Pearl Research, a business intelligence and consulting firm, specializes in the interactive entertainment and games market with a special focus on the Asia-Pacific region. Based in San Francisco, Pearl Research covers major markets such as China, Korea, Japan, Taiwan, India and Southeast Asia. Pearl Research provides its clients access to a vast knowledge base of market research information. The company publishes in-depth research reports and provides customized research and consulting services. For more information, please visit www.pearlresearch.com or contact us at research@pearlresearch.com or call (+1) 415-566-8509.

Contact
Allison Luong
Managing Director
aluong@pearlresearch.com
(+1) 415-566-8509

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