Spotlight falls on China as games industry comes of age
By Zhu Shenshen |
August 5, 2011, Friday
|
Print Edition
Print Edition
THE bird logo of the hit mobile game Angry Birds and the bulldog that symbolizes social network game developer Zynga loomed large at China's biggest annual game fair last week, a reminder to all that the game industry is on the cusp of major changes.
It was the first time that Finland-based Rovio Entertainment, developer of Angry Birds, and San Francisco-based Zynga attended the China Digital Entertainment Expo & Conference 2011, dubbed Chinajoy.
Though traditional multiplayer online role-playing games still contribute the majority of income for China's 30 billion yuan (US$4.6 billion) game industry, the presence of the two foreign giants pointed to new horizons in the mobile and social segments.
"We feel the change and the pressure," said Alan Tan, chief executive of Shanda Games, the country's number-three game firm. "It is a new lesson for all Chinese game firms to learn."
The game industry, which is highly dependent on multiplayer games with 3D and other graphics effects, is facing a growth bottleneck, according to industry insiders.
Last year, China's game revenue rose 27 percent to 32.3 billion yuan, only half the size of gains made in recent years, according to the General Administration of Press and Publication.
In the second quarter of this year, China's game revenue rose a meek 8.8 percent to 7.3 billion yuan, according to Beijing-based researcher Analysys International.
The change in industry trends started overseas, with new star firms like Rovio with Angry Birds, Zynga, with hot social games for Facebook, and India-based PopCap, which designed Plant vs Zombie for the iPhone, iPad and other mobile devices.
Zhang Yaqin, a vice-president of Microsoft, said: "Mobile and social games have become a trend and people are easily addicted to them."
Microsoft plans to integrate platforms for game console Xbox and mobile devices with Windows Phone 7, which will allow users to play Xbox games on handset screens next year, Zhang said.
In capital markets, the start-up stars are gaining momentum.
US-based game giant Electronic Arts is in the process of acquiring PopCap for up to US$1.3 billion. Zynga is close to an initial public offering, which is being hailed as the most important IPO before Face-book sells shares.
China's mobile game industry revenue will grow in value to 1.5 billion yuan this year, with 65 percent growth year-on-year, US-based research firm IDC said during Chinajoy.
Mobile games have become more popular with the increasing use of smart phones and with 3G providing high-speed mobile networks.
Chinese firms want to copy the overseas success through cooperative ventures and investment.
Tencent QQ, the country's biggest instant message service provider, teamed up with Zynga last month to introduce the Chinese version of flagship product CityVille.
In the US, family members, including grandparents, often play same social games to improve personal relationships, underscoring the reach and potential of social games, Zynga officials told Shanghai Daily during Chinajoy.
Shenzhen-based Tencent, whose mobile game revenue grew 65 percent in the second quarter, also announced it will provide an open platform for game developers.
During the show, Shanghai-based Shanda invited senior executives of Rovio to showcase the success of Angry Birds, which boasts 300 million downloads globally, making it the world's top mobile game.
"Angry Birds will continue its magic in China," Peter Vesterbacka, Rovio's chief marketing officer, said during the Global Interactive Entertainment Expert Forum sponsored by Shanda. "The key point is brand and fans."
In concert with several Chinese partners, Rovio will open 100 branded stores in China to promote and sell Angry Birds products.
Shanda said it will invest up to US$500 million this year, including acquisitions, to penetrate the mobile and social game sectors. It also launched a mobile game platform and set up a studio to produce the new so-called light games.
"Hardcore games are still needed, but more people will play 'light' games," Shanda's Tan said.
In the third quarter, Shanda will unveil its first mobile game.
Nasdaq-listed The9 also announced during the Chinajoy event that it has signed agreements with China's three mobile phone operators to provide them with mobile game content and products for their online application stores.
The three carriers, China Mobile, China Telecom and China Unicom, all attended the game fair to showcase their mobile game products.
For mobile carriers, the transition is imperative because voice income is declining, analysts said.
It was the first time that Finland-based Rovio Entertainment, developer of Angry Birds, and San Francisco-based Zynga attended the China Digital Entertainment Expo & Conference 2011, dubbed Chinajoy.
Though traditional multiplayer online role-playing games still contribute the majority of income for China's 30 billion yuan (US$4.6 billion) game industry, the presence of the two foreign giants pointed to new horizons in the mobile and social segments.
"We feel the change and the pressure," said Alan Tan, chief executive of Shanda Games, the country's number-three game firm. "It is a new lesson for all Chinese game firms to learn."
The game industry, which is highly dependent on multiplayer games with 3D and other graphics effects, is facing a growth bottleneck, according to industry insiders.
Last year, China's game revenue rose 27 percent to 32.3 billion yuan, only half the size of gains made in recent years, according to the General Administration of Press and Publication.
In the second quarter of this year, China's game revenue rose a meek 8.8 percent to 7.3 billion yuan, according to Beijing-based researcher Analysys International.
The change in industry trends started overseas, with new star firms like Rovio with Angry Birds, Zynga, with hot social games for Facebook, and India-based PopCap, which designed Plant vs Zombie for the iPhone, iPad and other mobile devices.
Zhang Yaqin, a vice-president of Microsoft, said: "Mobile and social games have become a trend and people are easily addicted to them."
Microsoft plans to integrate platforms for game console Xbox and mobile devices with Windows Phone 7, which will allow users to play Xbox games on handset screens next year, Zhang said.
In capital markets, the start-up stars are gaining momentum.
US-based game giant Electronic Arts is in the process of acquiring PopCap for up to US$1.3 billion. Zynga is close to an initial public offering, which is being hailed as the most important IPO before Face-book sells shares.
China's mobile game industry revenue will grow in value to 1.5 billion yuan this year, with 65 percent growth year-on-year, US-based research firm IDC said during Chinajoy.
Mobile games have become more popular with the increasing use of smart phones and with 3G providing high-speed mobile networks.
Chinese firms want to copy the overseas success through cooperative ventures and investment.
Tencent QQ, the country's biggest instant message service provider, teamed up with Zynga last month to introduce the Chinese version of flagship product CityVille.
In the US, family members, including grandparents, often play same social games to improve personal relationships, underscoring the reach and potential of social games, Zynga officials told Shanghai Daily during Chinajoy.
Shenzhen-based Tencent, whose mobile game revenue grew 65 percent in the second quarter, also announced it will provide an open platform for game developers.
During the show, Shanghai-based Shanda invited senior executives of Rovio to showcase the success of Angry Birds, which boasts 300 million downloads globally, making it the world's top mobile game.
"Angry Birds will continue its magic in China," Peter Vesterbacka, Rovio's chief marketing officer, said during the Global Interactive Entertainment Expert Forum sponsored by Shanda. "The key point is brand and fans."
In concert with several Chinese partners, Rovio will open 100 branded stores in China to promote and sell Angry Birds products.
Shanda said it will invest up to US$500 million this year, including acquisitions, to penetrate the mobile and social game sectors. It also launched a mobile game platform and set up a studio to produce the new so-called light games.
"Hardcore games are still needed, but more people will play 'light' games," Shanda's Tan said.
In the third quarter, Shanda will unveil its first mobile game.
Nasdaq-listed The9 also announced during the Chinajoy event that it has signed agreements with China's three mobile phone operators to provide them with mobile game content and products for their online application stores.
The three carriers, China Mobile, China Telecom and China Unicom, all attended the game fair to showcase their mobile game products.
For mobile carriers, the transition is imperative because voice income is declining, analysts said.
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