As Pakistan embraces its digital transformation, one industry that stands out for its remarkable growth and innovative potential is gaming. The sector has surpassed digital advertising, now valued at $500 million and outpaced traditional entertainment. It is also reshaping the way people engage online. Although accounting for a fraction of the $500 billion global gaming market, the rapid growth of Pakistan’s gaming sector compared to established industries like tea imports (valued at $700 million in 2022) illustrates its rising importance.

With over 34 million verified online gamers (projected to rise to 45 million by 2025), gaming in Pakistan has become a thriving ecosystem driven by affordable mobile broadband access for over 130 million people, propelling the industry’s reach beyond the population of many countries. Global gaming companies have taken notice, leveraging local talent through resource offshoring and development operations, amplifying their global presence while contributing to Pakistan’s economy.

In Pakistan, mobile gaming reigns supreme. Sixty percent of gamers play on mobile devices, 30% on PCs, and 10% on consoles. Each platform caters to various tastes and include:

Mobile Games: Hyper-casual games like Connect the Dots and immersive AAA titles and PUBG (PlayerUnknown’s Battlegrounds) engage millions.

PC Games: Story-driven experiences like Civilization and multiplayer games like Counter-Strike attract enthusiasts.

Console Games: Single-player narratives and cross-platform multiplayer titles offer deeper immersion.

Amid this burgeoning ecosystem, advertising remains largely untapped, especially given that although Pakistani gamers form five percent of the world’s population, advertising amounts to only 0.1% of the gaming-related spending, giving brands a unique chance to foster authentic connections.

Asset Placement: In-game billboards, branded items and sponsored levels seamlessly integrate with virtual environments for effective, non-intrusive brand exposure.

Cross-Platform Strategies: Although console advertising remains restrictive, mobile games offer an expansive playground.

E-sports and Pop Culture Events: Sponsorships and partnerships at tournaments create strong brand resonance among passionate gaming communities.

A recent example of gaming as an advertising medium was when HBL launched Konnect through the HBL EAFC Gaming Tournament. The event showcased e-sports talent while placing HBL at the forefront of a burgeoning demographic, executed by IGN and Raptr Games. However, advertisers disproportionately benefit from the low cost of in-game ads: Rs 30 to Rs 40 ($0.1 to $0.13) per 1,000 impressions, compared to $15 to $20 in the US and Europe. While this offers brands an affordable reach, it makes it challenging for game creators to monetise their work, limiting their ability to promote and sustain games in Pakistan.

Developers, content creators and streamers are transforming their passion for gaming into profitable careers, from working on international projects to broadcasting on platforms like Twitch and YouTube.

Development and Publishing: This is a $230 million annual service sector that is constrained by limited critical thinking skills rooted in the education system. While India has reached billions, Pakistan may struggle to reach its first billion until education improves.

Content Creation and E-sports: E-sports events, podcasts and digital shows build profitable networks through advertising and sponsorships. Top performers earn millions, inspiring the next generation of e-sports stars.

Streaming and E-sports: Streamers in Pakistan can earn $5,000 to $20,000 annually with creative narration and appealing gameplay, attracting over 100,000 subscribers.

Female gamers represent 23% of the gaming population (around eight million players). However, many women face cyberbullying and harassment, limiting their full participation. Developers, platforms and communities must establish stricter moderation policies and supportive networks to build a more inclusive environment.

The government can play a crucial role in helping the gaming industry reach its full potential.

Infrastructural Investment: Improve internet reliability and establish gaming hubs to drive innovation. Expanding high-speed internet access to remote areas will provide equitable opportunities.

Education and Training: Partner with institutions to develop skills in game design and development. Vocational training programmes should embrace gaming careers.

Incentives and Tax Breaks: Attract local and foreign investment through financial incentives and facilitate multinational dividend remittances.

Regulatory Framework: Clarify IP rights and enforce the rule of law for stakeholder confidence.

Talent Promotion: Provide grants, awards and global showcases to elevate local developers.

A look at India’s gaming industry offers valuable lessons in how strategic investments, technological advancements and policy frameworks can stimulate substantial growth.

Market Size and Growth: India’s gaming industry is projected to grow from $3.5 billion in 2024 to $7.24 billion by 2029, a surge that reflects a compound annual growth rate of over 15%, signalling a robust future.

Smartphone Penetration: The increase in smartphone users, surpassing 750 million, has driven the growth of mobile gaming. Affordable data plans have further encouraged this trend.

Government Initiatives: The Indian government, through programmes like the Khelo India Scheme, has encouraged indigenous games and sports, supporting the development of local gaming talent.

E-sports Expansion: Competitive gaming is a significant growth driver, with local tournaments fostering new talent and expanding the player base.

Mobile Dominance: Android remains the dominant platform due to its affordability and the prevalence of brands like Xiaomi, Realme and Samsung.

In-App Purchases: A significant portion of gaming revenue comes from in-game purchases and advertising. Indian gamers are increasingly willing to pay for additional features and upgrades.

Global Partnerships: International companies like Microsoft and Electronic Arts are investing in the Indian gaming market, expanding collaborations.

Regional Trends: Different regions show varied gaming preferences, which developers can leverage for tailored marketing and game design.

Data and Insights: Market research firms are providing granular data to help stakeholders understand trends, allowing developers to align strategies.

Challenges Remain: Privacy concerns, fraud in gaming transactions and regulatory challenges need to be addressed to sustain growth.

Pakistan’s gaming industry is not just an economic force but a cultural shift towards interactive digital entertainment. With the right investment in infrastructure and education, along with a supportive policy framework, Pakistan can emulate India’s $3.5 billion gaming sector.

By embracing this opportunity, Pakistan will usher in an era of cultural and economic prosperity where the gaming spirit knows no limits. Let’s empower developers, players and communities to lead the way into a limitless digital future.

(Sources: Mordor Intel & IMARC Reports)

Faizan Syed is Founder and CEO, East River.
faizan@eastriverdigital.com