Shark takes a bite of mobile games
DOODLE Jump, Angry Birds, and Plants vs. Zombies. App Store millionaires are leading programmers all over the world in a digital gold rush. Caught up in this feverish wave of mobile game-writing are two young Chinese entrepreneurs: Shao Ling and Li Bo.
The two 27-year-old college friends co-own a company called Shark Game located on Zhongshan Road S. It develops more than 30 mobile wireless games each year, covering genres that include role-playing games, board and cards, action and recreation.
Last year, the company notched up a record profit of more than 1 million yuan (US$153,100) and expanded its three-person business into a team of 30 planners, programmers, designers and testers, thanks to burgeoning demand in the world's biggest Internet market.
"We have come such a long way in a career bootstrapped with only pocket money back in 2006," Shao said.
With bachelor's degrees in computer science fresh in their pockets at the time, Shao and Li teamed up with a college classmate named Liu Le to develop a creative mobile website as the cornerstone for their own business.
An art graduate named Duan Yuntao was brought on board to help the user interface design. They named the team Shark and bravely sailed out to conquer the choppy seas of the digital era.
But the initial voyage sank. The project was saddled with a muddled business plan, and their savings were soon spent. Liu quit the group in 2008, forcing Shao and Li to rethink their plans.
"Life comes down to a few moments," Li said. "We decided to stake the future of the business on mobile game development."
China's mobile game industry was then just beginning to enter a golden era. The revolutionary game download services of Treasure Chest, launched by China Mobile in 2004, started the boom in content creation. Mobile subscribers were thrilled at the surging choice of games beyond those traditionally carried on handsets.
It was a fast-paced business. The short development cycle - three to four months for each game - would quickly attract small change, like 3 to 10 yuan (US$0.46 to US$1.53) from each subscriber per month. As the base of users grew, so did the revenue. Shark finally pulled out of its financial difficulties.
"We worked our fingers to the bone in a cramped suburban apartment that was both home and office, and ate on a shoestring budget," Shao said. "It was a trying time, but we knew we could get through it if we persevered."
Their pilot games began receiving market hits, albeit few in number, in 2008, and they started to pull in enough money to make ends meet.
They saved up to 300,000 yuan to officially launch the company and moved into a real office to house the expanding team in 2009.
"There is hardly any overnight success in the industry," Li said. "It takes time to learn how to run a business at the intersection of content and technology."
The role-playing game sits atop Shark's genre list. Based on prevailing page turners like wuxia legends, which are fictional accounts of traditional martial artists, and ancient myths, role-playing games can naturally incorporate pop elements into settings, plots, and characters, making the content easy for players to identify with.
The games are also more likely to engage players given their complex narrative logic, and that in turn sets higher standards for the simultaneous cooperation between planning and programming, which, according to Li, are never separable.
Like other game developers in China, Shark in many cases offers free games at the start to attract players. It makes its money by charging for value-added services embedded in the advanced levels of the game.
"Having a little free experience at the start is a big intrigue for our customers because most of them are cautious about spending money on something they don't know," Li said.
Many game addicts are young migrant workers and students who are short of money, so this system tends to work well in bolstering the player base, he explained.
Mobile games are an appealing and economical alternative to computer entertainment. A handset worth less than 1,000 yuan (US$153) can easily handle game downloads via mobile Internet and payment is easy via short message services or pre-paid cards. It's entertainment that can be accessed anytime, anywhere.
Player demographics largely affect Shark's choices of mobile game development platforms. Last year, it produced 21 games on Java and 12 on MTK, compared with only three on iPhone's iOS and one on Android.
The first two have been dominating China's low and lower-middle segments for years, while the other two are gaining popularity at the higher end of the market.
"We are fine-tuning our steps toward the rising segment of smartphones, but that won't shift our focus," Shao said.
He said he doubted whether fancy, more expensive gadgets would become affordable to mainstream players in the foreseeable future.
"And it is still hard to rely on their fledging business models for profits," he said of iOS and Android.
Shark's pilot iPhone games sank amid an explosion of content on App Store last year, while its Android experiment is still looking for a more sustainable profit mode than charging for embedded ads.
"By comparison, the pre-screening and income-sharing models adopted by the service providers of Java and MTK are much better," Shao said.
Shark's classic "Mechanical Storm" once ranked first among downloads at Tencent's QQ Mobile Game Center, one of the most influential service providers of Java games in China.
But for Shao and Li, gone are the days when great performance on a download platform guaranteed success.
"Our business is now prone to any upstream change," Li said.
Sitting atop of the industry value chain are the two mobile telecom operators, China Mobile and China Unicom. Their payment delivery via short message services, which has been adopted by most of the transaction channels of game download service providers, plays a vital role in the income flow of game developers.
That's why the sudden suspension of China Mobile's payment delivery services on many download platforms last year came as such a fatal blow to many start-ups in the business.
It was intended to restore order among download service providers, some of whom were accused of selling pornography via game transaction channels.
However, game developers who did nothing wrong were left with no way to charge users.
For the present, Shark has to look for new transaction channels every three weeks to secure its income.
"This hide-and-seek is only a half measure," Li admitted.
"Our biggest dream is to shape Shark's future ourselves."
The duo plan to expand into mobile online games and avoid risks by relying on a time card, or a virtual account, to collect payments. This method is usually managed by game developers themselves.
Shark's first mobile online game has already been undergoing internal testing and will hit the market later this year.
The advent of 3G communications will largely improve the network environment in China, which is essential in promoting multi-player and cross-platform games.
"Keep thinking and creating. That's how we will dig out the next gold mine entrance," Shao said.
The two 27-year-old college friends co-own a company called Shark Game located on Zhongshan Road S. It develops more than 30 mobile wireless games each year, covering genres that include role-playing games, board and cards, action and recreation.
Last year, the company notched up a record profit of more than 1 million yuan (US$153,100) and expanded its three-person business into a team of 30 planners, programmers, designers and testers, thanks to burgeoning demand in the world's biggest Internet market.
"We have come such a long way in a career bootstrapped with only pocket money back in 2006," Shao said.
With bachelor's degrees in computer science fresh in their pockets at the time, Shao and Li teamed up with a college classmate named Liu Le to develop a creative mobile website as the cornerstone for their own business.
An art graduate named Duan Yuntao was brought on board to help the user interface design. They named the team Shark and bravely sailed out to conquer the choppy seas of the digital era.
But the initial voyage sank. The project was saddled with a muddled business plan, and their savings were soon spent. Liu quit the group in 2008, forcing Shao and Li to rethink their plans.
"Life comes down to a few moments," Li said. "We decided to stake the future of the business on mobile game development."
China's mobile game industry was then just beginning to enter a golden era. The revolutionary game download services of Treasure Chest, launched by China Mobile in 2004, started the boom in content creation. Mobile subscribers were thrilled at the surging choice of games beyond those traditionally carried on handsets.
It was a fast-paced business. The short development cycle - three to four months for each game - would quickly attract small change, like 3 to 10 yuan (US$0.46 to US$1.53) from each subscriber per month. As the base of users grew, so did the revenue. Shark finally pulled out of its financial difficulties.
"We worked our fingers to the bone in a cramped suburban apartment that was both home and office, and ate on a shoestring budget," Shao said. "It was a trying time, but we knew we could get through it if we persevered."
Their pilot games began receiving market hits, albeit few in number, in 2008, and they started to pull in enough money to make ends meet.
They saved up to 300,000 yuan to officially launch the company and moved into a real office to house the expanding team in 2009.
"There is hardly any overnight success in the industry," Li said. "It takes time to learn how to run a business at the intersection of content and technology."
The role-playing game sits atop Shark's genre list. Based on prevailing page turners like wuxia legends, which are fictional accounts of traditional martial artists, and ancient myths, role-playing games can naturally incorporate pop elements into settings, plots, and characters, making the content easy for players to identify with.
The games are also more likely to engage players given their complex narrative logic, and that in turn sets higher standards for the simultaneous cooperation between planning and programming, which, according to Li, are never separable.
Like other game developers in China, Shark in many cases offers free games at the start to attract players. It makes its money by charging for value-added services embedded in the advanced levels of the game.
"Having a little free experience at the start is a big intrigue for our customers because most of them are cautious about spending money on something they don't know," Li said.
Many game addicts are young migrant workers and students who are short of money, so this system tends to work well in bolstering the player base, he explained.
Mobile games are an appealing and economical alternative to computer entertainment. A handset worth less than 1,000 yuan (US$153) can easily handle game downloads via mobile Internet and payment is easy via short message services or pre-paid cards. It's entertainment that can be accessed anytime, anywhere.
Player demographics largely affect Shark's choices of mobile game development platforms. Last year, it produced 21 games on Java and 12 on MTK, compared with only three on iPhone's iOS and one on Android.
The first two have been dominating China's low and lower-middle segments for years, while the other two are gaining popularity at the higher end of the market.
"We are fine-tuning our steps toward the rising segment of smartphones, but that won't shift our focus," Shao said.
He said he doubted whether fancy, more expensive gadgets would become affordable to mainstream players in the foreseeable future.
"And it is still hard to rely on their fledging business models for profits," he said of iOS and Android.
Shark's pilot iPhone games sank amid an explosion of content on App Store last year, while its Android experiment is still looking for a more sustainable profit mode than charging for embedded ads.
"By comparison, the pre-screening and income-sharing models adopted by the service providers of Java and MTK are much better," Shao said.
Shark's classic "Mechanical Storm" once ranked first among downloads at Tencent's QQ Mobile Game Center, one of the most influential service providers of Java games in China.
But for Shao and Li, gone are the days when great performance on a download platform guaranteed success.
"Our business is now prone to any upstream change," Li said.
Sitting atop of the industry value chain are the two mobile telecom operators, China Mobile and China Unicom. Their payment delivery via short message services, which has been adopted by most of the transaction channels of game download service providers, plays a vital role in the income flow of game developers.
That's why the sudden suspension of China Mobile's payment delivery services on many download platforms last year came as such a fatal blow to many start-ups in the business.
It was intended to restore order among download service providers, some of whom were accused of selling pornography via game transaction channels.
However, game developers who did nothing wrong were left with no way to charge users.
For the present, Shark has to look for new transaction channels every three weeks to secure its income.
"This hide-and-seek is only a half measure," Li admitted.
"Our biggest dream is to shape Shark's future ourselves."
The duo plan to expand into mobile online games and avoid risks by relying on a time card, or a virtual account, to collect payments. This method is usually managed by game developers themselves.
Shark's first mobile online game has already been undergoing internal testing and will hit the market later this year.
The advent of 3G communications will largely improve the network environment in China, which is essential in promoting multi-player and cross-platform games.
"Keep thinking and creating. That's how we will dig out the next gold mine entrance," Shao said.
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