China may have zapped US to top gaming sales

FANTASY ROLE PLAY: A cosplay event was part of a marketing campaign for the e-sport League Of Legends in Hangzhou in Zhejiang province.


    Mar 11, 2016

    China may have zapped US to top gaming sales


    THE digital gaming market in China has grown robustly in the past few years, on the back of popular mobile games and e-sports.

    The uptrend is expected to continue.

    According to Newzoo, a global gaming research firm, the country's digital games market may have notched up sales of US$22.2 billion (S$30.7 billion) last year, up 23 per cent year-on-year.

    It surpassed the United States where sales touched US$22 billion.

    If the actual figures confirm the estimates, China will have become the world's largest market for mobile games.

    In a nod to the industry's growth, the State General Administration of Sport, the national governing body of e-sports, announced in December that it will hold China Mobile E-Sports Games this year.

    The gaming market has never had it so good.

    The range now available includes Web, mobile, single-player and video games.

    The trend is driven by 534 million players last year, up 3.3 per cent from 2014, according to a report by the China Audio-Video and Digital Publishing Association and the CNG Games Research Centre.

    Most are hooked to mobile games, the key driver of sales, as more people started using smartphones.

    Sales of mobile games alone soared 87 per cent from 20 billion yuan (S$4 billion) in 2014 to 51.46 billion yuan last year, according to estimates.

    Analysys International, a Beijing-based consultancy, estimated sales of mobile games will reach 52.37 billion yuan this year, up 27 per cent year-on-year.

    In 2017, sales are expected to surpass 66.83 billion yuan, up 27.6 percent year-on-year.

    Yao Jianjun, chief executive of Feiyu Technology International, a leading domestic Internet game developer, knows why sales are surging.

    "With the advent of mobile Internet and continuous improvements in hand-held devices' capabilities... a large number of people who had seldom played games in the past are enjoying mobile games now."

    Industry insiders said China's mobile games market will record a compounded annual growth rate of about 30 per cent in the coming years, much higher than that of Web-based games.

    Mr Yao said as users' playing habits evolve, they are willing to pay for and play games that challenge and stimulate them. Such players are not always looking for free stuff.

    The digital games sector in China is powered by more than 20,000 game developers.

    As of last August, they had come up with more than 20,000 types of games, according to industry figures.

    There are 171 listed games companies with a collective market value of 4.76 trillion yuan.

    Such staggering growth came on the back of Beijing's decision to simplify procedures related to registration and operations of such firms.

    Last year, the authorities shortened the period of approvals for new games.

    Even the emerging e-sports may have reaped US$250 million in sales worldwide last year, according to Newzoo.

    China's e-sports were expected to earn a revenue of US$36.7 million last year, which would put the country on top of all Asian markets.

    In response, the government has taken steps to stimulate growth of the e-sports market.

    In January, the China Culture and Entertainment Industry Association, which is overseen by the Ministry of Culture, established an e-sports branch.

    The aim is to fully develop competitive digital games products, explore recreation and entertainment places, and conceptualise e-sports events.