India’s gaming sector hit a hard reset in 2025. Real-money gaming (RMG), which accounts for the majority of the country’s gaming revenues, was crushed by a sweeping new online gaming law that outright banned it.
- Moneycontrol closely tracked the chaos that followed: from a swift collapse and widespread cost-cutting to a desperate scramble to figure out what comes next
Meanwhile, in the broader entertainment space, new formats like microdramas gained rapid adoption while filmmakers explored newer distribution channels.
- At the same time, studios began formulating their AI strategies as the technology reshapes the future of storytelling
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- The law sent shockwaves through the $3.5 billion RMG industry, blindsiding companies with a move one saw coming. Shortly after the ban, Harsh Jain, co-founder and CEO of Dream Sports, the parent company of Dream11 and arguably the biggest player in the space, described it as an “unexpected knockout punch”. In an interview with us, he said the move wiped out 95% of the group’s revenues and all its profits, even as he insisted he remains “a delusional optimist.” Dream Sports has since repositioned Dream11 as a sports entertainment platform and split into eight ‘startups’, each with its own leadership.
- In the months that followed, RMG platforms laid off over 2,500 employees as revenues dried up and companies scrambled to survive in the new reality. Firms that cut jobs include Head Digital Works (A23), Gameskraft, Games24x7, Mobile Premier League (MPL), Nazara Technologies-backed Baazi Games (Moonshine Technology), and Junglee Games. Bharti Airtel scion Kavin Bharti Mittal shut down his 13-year-old startup, Hike. Startups like Zupee and WinZO forayed into a range of consumer internet categories, including microdramas, digital gold, astrology, and microlearning, among others. Read our year-end recap of India’s RMG industry.
- South Korean gaming giant Krafton is also looking beyond gaming for its next big India investment. It is launching a Rs 6,000 crore India-focused investment fund in partnership with fellow Korean firms Mirae Asset and Naver to back startups poised to become unicorns in areas such as AI, fintech, digital content, and logistics. The BGMI maker also made its first acquisition in the country, buying over 75% stake in Nautilus Mobile, the Pune-based developer of the Real Cricket franchise, for Rs 118 crore in March.
- Turning to entertainment, Google-owned YouTube is experimenting with a “meaningful distribution alternative” for production houses and studios, India MD Gunjan Soni told us in an interview. A key pilot was Aamir Khan’s Sitaare Zameen Par, which debuted on YouTube as a rental across India and 38 global markets, bypassing streaming platforms. Soni, who joined YouTube earlier this year to lead its India operations, said the platform is also sharpening its focus on live content and creator-led shopping initiatives.
- Studios like Abundantia Entertainment, makers of popular series Breathe and movies like Toilet, have even opened a new AI division to develop a slate of six films with expectations of the AI division contributing to about 35% of the firm’s total revenues in 3 years. Founder Vikram Malhotra insists this is no passing fad.
- Speaking of short content, Indian audiences saw a microdrama boom this year, with platforms offering bite-sized content attracting significant investor interest. Moneycontrol reported that micro-drama OTT platforms raised $44 million across six rounds in the first half of 2025 versus $28 million raised across five deals in all of 2024.
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