Indian animation growth to slow

Lack of talent, IP protection barriers to billion-dollar industry

MUMBAI -- India's animation industry will see slower growth according to the annual report by the National Association of Software and Services Companies.

“The Animation and Gaming Report 2008-09” has revised its forecast for the sector, expecting a dip in growth rates for two years before becoming a billion-dollar industry by 2012.

Last year's report had forecast that the animation industry would grow at a CAGR of 27% to reach $1.2 billion by 2012, from $460 million in 2008. The gaming industry was to grow at a CAGR of 50% to reach $1.060 billion by 2012, from $212 million in 2008.

"The Indian animation industry is expected to grow at a CAGR of 22% to reach $1 billion while the gaming industry will grow at a CAGR of 49% to reach $830 million by 2012," said Nasscom president Som Mittal.

The report, prepared by Nasscom and Ernst & Young, provides a detailed insight on the growth drivers, business models, issues and challenges for the gaming and animation industry in the next few years.

Slow growth of domestic box-office for animation movies, absence of adequate proof of concept or intellectual property creation, and lack of availability of skills for the animation industry are other factors that have led Nasscom to revise its earlier forecast.