Gambling is a niche in India because game retail is broken

The game is niche in India, and while there is a lot of excitement among fans, the general public is largely indifferent. But is it simple enough to say that Indians are not interested in gambling? Mobile games are a huge business here, and local game development studios are starting to make an impact on smartphones.

So why aren’t consoles a top-selling item in India? Part of the reason is that aside from a few specialty stores, such as Games The Shop and Game4u, the vast majority of stores selling video game consoles and software don’t seem to really understand the business. Specialty stores only sell games, and game-related merchandise is not dependent on other products, and therefore has some understanding of what they are trying to change, but mass stores are largely clueless.

Unfortunately, the majority of consoles sold in India do not go through these specialty stores. Most of the official games console sales in the country take place at large format retailers or LFRs as they are known in retail parlance. These include stores such as Landmark, Croma and Reliance. This is where a lot of people buy their tech, if they’re not buying from Flipkart or Amazon.

(Also see: Here’s why you can buy FIFA 16 and other EA games only from Amazon India)

And this is where the problem begins. Walk into a consumer electronics store looking for something like a PS Vita and you’re bound to be met with blank stares and whispers that some sort of thing may have existed in a bygone era. Unfortunately, if you went back to the launch of the PS Vita, you would realize that it was exactly the same situation even when the console was brand new.

Companies like Sony rely on brick-and-mortar outlets to make the majority of their sales, but stores have their own agenda. It’s usually about providing people with a solution that involves minimal effort. Retail in India relies on a wave of rapid transactions from a relatively large number of customers, rather than building trust and loyalty. And it’s more obvious in a category like games.

For example, until the end, the PlayStation Portable (PSP) was sold regularly. Yes, it’s outdated, but retail management doesn’t care. In their eyes, customers want something affordable that can be hacked so you can hack games, which always seems premium, and the PSP is just that.

“Sir, you should get PSP instead of Vita, you can hack and install games yourself. Free.” That’s what a salesman at a well-known electronics chain said to this correspondent some time ago, as if discovering the eternal fountain of youth, conveniently forgetting that a thick layer of dust covers the PSP games in the store.

He doesn’t care about software sales or that the lack of them will lead to fewer games being made in the future, which will keep me from buying games from him. He just wants to make a quick sale.

Unfortunately, it works. The sales pitch may convince a large part of the public, many of whom are still unaware that the game has evolved beyond Mario and Tetris. Against this backdrop, rumors that Sony released a few thousand new PSP units a few weeks ago sitting in its service centers at a major Indian e-commerce player are starting to make sense.

(Also see: The best PlayStation Vita games March 2015)

In the long run, such a decision only serves to feed lingering ignorance. For Sony, the move is aimed at eliminating inventory and possibly making up for the shortfall in PS Vita sales. For retailers, it rewards their apathy and disregard for a category that deserves far better. The only time the PS Vita had decent retail exposure was three months after launch for reasons unrelated to gaming.

“The LFRs weren’t keen on selling the Vita because it couldn’t be hacked. So we told them that if they wanted stock Bravias, Vaios [which were very popular at the time] and Xperias, so they had to store the Vita,” a former Sony employee told this correspondent, a year after the Vita launched.

And they put the Vita front and center, but that was it. A quick Google search helped a consumer make a more informed buying choice than talking to a salesperson.

What you get is a great device with a stellar lineup of games that didn’t stand a chance at retail because whoever was selling it didn’t even bother to give it a shot. Sony’s prices might not have been the best and that’s the excuse you’ll hear from many sellers.

(Also see: Xbox One Dominates US With Black Friday Deals, Gets Dominated In India)

By that logic, the PS4 shouldn’t be the sales success it is at local retail. You can’t play pirated games, you can’t hack it, and it’s “too expensive” (although that’s about to change). But Sony’s international campaign and the value of the PlayStation brand meant there was demand for the console, even if retailers weren’t particularly invested in the category.

Ignorance is not limited to offline retail either. Retailing video games online is just one mistake after another. Amazon’s exclusivity for Xbox One and EA’s roster of games backfired, as did Flipkart’s exclusivity for Call of Duty: Advanced Warfare.

And that’s why gambling in India remains a niche market, even though other developing markets are growing. It’s not just because of mobile games, and it’s not just because of high prices. No. We’re still a small market for games, and that’s because the people who have to sell them don’t care. A wave of indifference is drowning the game in India – retail is down and there is no one to fix it.