Jayont R. Sharma, Founder Chairman and CEO, Milestone Interactive Group, A pioneering leader of India’s video gaming industry, Jayont has been at the forefront in introducing and promoting international game publishers such as; Sony Playstation, Electronic Arts, Capcom etc in India since 1995. As founder and promoter of Milestone Interactive Group, he has played an integral part in shaping India’s gaming landscape and in steering Milestone to its current position as a market leader in console and PC Game software. Jayont has been the key driver of all new business initiatives of the group. He pioneered the launch of specialty game retail in India through the launch of “Game4u” branded e-Commerce store – www.game4u.com in the year 2009 and thereafter followed by the first “Game4u” brick and mortar store in February 2010. The past 15 years as an entrepreneur have given him a deeper exposure and insight of the entertainment, information technology and retail industries.
Milestone Interactive Group was founded in 1997 with a vision to create a multi-faceted business catering to the Indian Gaming industry. Fifteen years after its inception, the company continues to spearhead growth and development of the gaming industry in India.
Milestone’s Game Distribution division is the pioneer Distributor for console & PC games in India. It has been engaged in marketing & distribution of Interactive game software, game peripherals and hardware with close relations with dominant global game publishers including; Sony Computer Entertainment (SCEE), Electronic Arts (EA), Capcom, Tecmo Koei; and for gaming merchandise National Entertainment Collectables Association (NECA) & Diamond Comic Distributors. Game4u, the retail division of Milestone, is India’s premium multichannel retailer of PC and video games, game consoles and related accessories with access to a comprehensive choice of games and peripherals. Its vision is to be the # 1 specialist game destination in India through best-in-class products & services leading to a delightful consumer experience. With the launch of e-retail store www.game4u.com in 2009, followed by the first brick & mortar store in 2010, Game4u’s retail network currently spans to eight company-operated stores in India.
Replying to Anil Mascarenhas of IIFL, Jayont Sharma says, “Introduction of 3G and telco’s focus on Value Added Services are expected to lead to exponential growth for mobile gaming in India.”
Give us a brief overview of your business model.
Milestone Interactive Group’s Game Distribution division is the pioneer Distributor for console & PC games in India. It has been engaged in marketing & distribution of Interactive game software, game peripherals and hardware with close relations with dominant global game publishers and distributors for gaming merchandise. The Information & Communication Technology (ICT) division is engaged in distribution of prominent brands such as AVG Technologies and Kensington Computer Products Group. Game4u, the retail division of Milestone, is India’s premium multichannel retailer of PC and video games, game consoles and related accessories. Publishing and Digital Services (P&DS) division offers compelling casual games on digital mass formats including; mobile devices (Android, iOS, Windows Mobile), PC Casual/Social platforms, Digital iTV and Smart TV applications. We are also capable of executing varied game development projects on account of multiple studio partnership model. The strategy, we are sure, will enable us to achieve the status as India’s premier video, PC and casual & mobile gaming company.
What are some of the changing trends in the gaming space? What is the size of the market?
Gaming industry is expected to witness large changes, primarily in the Indian market. Introduction of 3G and telco’s focus on Value Added Services are expected to lead to exponential growth for mobile gaming in India. This will also lead to the Indian gaming players moving up the value chain and getting involved in end-to-end game development and publishing. As the Indian market matures and gains expertise, Indian players will gain confidence of their foreign counterparts and attract greater percentage share of the outsourcing pie and co-publishing deals.
According to the latest KPMG FICCI report, the Indian gaming sector achieved revenues of INR 13 billion & is expected to grow at a CAGR of 29% to reach INR 46 billion by 2016.
Which are the global companies you represent in India? How is the revenue sharing done?
The Game Distribution division represents well known and trusted global game publishers like; Capcom, Electronic Arts (EA), Tecmo Koei and Sony Computer Entertainment (SCEE); and for gaming merchandise National Entertainment Collectables Association (NECA) & Diamond Comic Distributors. Leading international brands in the ICT space like AVG Technologies and Kensington Computer Products Group.
The relationships are based on a licensing or finished product distribution model. Accordingly, the gross margins differ.
What is the vision of your company?
Our vision is to be: India’s premier Interactive Entertainment Company; offering innovative products & services – leading to consumer delight and stakeholder value.
What are the opportunities and challenges in this business?
In the not-so-distant past, video games were found only on bulky arcade machines, and involved a few floating dots and a Pac-Man to eat them. From Pac-Man, to Mario and the first Nintendo consoles, to the advanced games and systems that exist today, the video gaming industry has grown into a global powerhouse. Gaming is developing into an important segment in India’s entertainment industry largely driven by the country’s large youth population.
The major challenges for the industry are; grey imports and sale of pirated software. Clearly, these malpractices are a concern not just for us but for the gaming industry at large. In addition, high duties and taxes make it difficult to keep prices competitive to fight piracy and grey imports. The recent depreciation of the Rupee against the US$ has further added to product price inflation.
Product Innovation, International quality benchmarked local content availability and adoptions of a multi-channel retail strategy are going to be the cornerstone of this industry and will fuel a higher growth trajectory.
Tell us about your geographical spread. Which are the areas you plan to expand to?
The Game Distribution Division has a comprehensive distribution reach spanning the entire country with a specific focus on the top 60 cities in India and 1200+ retail stores across its key markets for distribution of Gaming software and accessories. While Game4u’s retail network currently spans eight company-operated stores in India which include Gurgaon (2), Mumbai (4) and one each at Jalandhar & Ludhiana and an online store - www.game4u.com.
Our focus for the next three years would be to make the Game4u brand one that is easily accessible to all gamers across India. This could be achieved by opening 50+ stores in next 3 years across the top 25 cities of India.
We are also looking to further enhance and strengthen our online store offering, in order to reach consumers beyond the top 25 cities and combine this with a credible digital download store for the popular gaming formats and devices. The anticipated penetration growth of e-commerce through growth of broadband will take gaming beyond 200+ cities in our country.
What is your employee strength? Are you able to find good talent for your business?
We have more than 160 employees across our various offices and stores. The Indian gaming industry is evolving as a promising industry for the creative, passionate gamers. Yes, we are able to find good talent. Also, we invest a lot of time in their grooming, training and development.
We have hired employees who are passionate gamers and at the same time have relevant education background to be able to fit the job profile and have the ability to work towards growing the business. Also, at the store level, we choose our front end staff as per the industry requirements that is – who are again passionate gamers and at the same time have customer service oriented attitude.
You’ve been through a phase when you wanted to shut shop. Tell us about it and what helped you move ahead and remain in business?
2002 – 2005: We had a Game development studio and were approved to develop a PS2 and PC Games. The game in development at that time went beyond budget and could not be completed. A decision had to be made. Therefore, in 2005, when we had to close down our Game development studio we took a big hit on our balance sheet. Also, our Game distribution business was not growing fast enough, a thought did occur my mind to close down the entire business. However, it just took me two days to get back to a positive frame of mind and focus on rebuilding the business. As a result of my resolve to fight-back and regain our numero-uno position in the industry and ably supported by my team, from Rs6 crore business, we have grown to reaching the Rs100 crore mark.
What is the shareholding pattern of the company? Any plans to sell stake?
Current held closely by the promoter and family. A stake sale is currently under consideration.
What are the factors boosting entrepreneurs in our country?
In India, students at premier management institutes are trained and encouraged in risk taking and entrepreneurial thinking during their study program. This is further cultivated through campus incubation of ventures. Given a more secure family environment within the middle and upper – middle class, it is very easy for a lot of these students to be able to start something on their own.
Therefore, entrepreneurs are nurtured early on and backed by financial support through family and angel funding to build their business.
Do you see any significant change among entrepreneurs in India and abroad?
Technology and new media start-ups have high similarity in India and abroad. However, it is at the grass-root level where brick & mortar business are created that India stands far ahead on the number of self-employed youth.
What support do you receive from your family for your ventures?
My wife backed me in the endeavour knowing my passion for being self employed. I also received financial backing from my family in the initial days, to set up my business.
What are some of the challenges faced by entrepreneurs besides funding?
A few years back the Indian entrepreneurs had to fight regional and national competition only. However, today, the scenario has changed and become much more complex than what it was earlier. Now, almost all countries have opened up their economies, and the world (globe) has become one giant global market.
To survive this competitive era of globalization, Indian entrepreneurs must prepare themselves with new, better, and innovative business tactics and skills. Therefore, a strong educational background supported by learning and skills gathered through on-the-job mentoring will go a long way in attainment of future success.