Shift from PC to mo­bile sends rev­enue soar­ing

China Daily (USA) - - ANALYSIS - By KARL WIL­SON

Per­sonal com­put­ers con­tinue to be the dom­i­nant de­vice for on­line gam­ing in China, but mo­bile games are now start­ing to close the gap.

In 2012, mo­bile de­vices ac­counted for just 5.4 per­cent of all gam­ing in China. Last year, they ac­counted for 36.6 per­cent, ac­cord­ing to dig­i­tal games data analysis firm DataEye.

One of the most sig­nif­i­cant trends in the mo­bile gam­ing space last year was the en­try of China’s top on­line PC gam­ing com­pa­nies, ac­cord­ing to a re­port in April by Forbes.

The re­port said the top seven com­pa­nies, which in­cludes NetEase Ten­cent and Gi­ant, re­leased over 150 mo­bile games last year. Of these Ten­cent and NetEase ac­counted for the top 10 ti­tles.

“This was a big move for China’s top on­line PC gam­ing com­pa­nies: While Ten­cent has pre­vi­ously showed in­ter­est in mo­bile gam­ing, the rest of China’s gam­ing gi­ants had largely steered clear of the mo­bile space, stay­ing fo­cused on the big­ger por­tion of games rev­enue, PC on­line games,” Forbes said.

“The top seven’s ex­pan­sion into mo­bile gam­ing serves as pow­er­ful val­i­da­tion that mo­bile gam­ing is a space wor­thy of their ef­forts, and it will be in­ter­est­ing to watch how the big play­ers shape their mo­bile gam­ing pres­ence mov­ing for­ward,” it added.

Jelle Koois­tra, head of prod­uct de­vel­op­ment at New­zoo Mo­bile, a di­vi­sion of re­search firm New­zoo, said the rapid in­crease in in­ter­net and smart­phone pen­e­tra­tion is one of the main rea­sons for the growth of mo­bile games.

“In China, core PC gamers are shift­ing part of their game spend­ing from PC to mo­bile, push­ing up mo­bile rev­enues in China, and sub­se­quently, all of Asia.”

Koois­tra said within the next few years most of the growth in mo­bile games in Asia, ex­pected to be worth around $9 bil­lion, will come from China.

“This growth is (al­ready) driven by the in­creas­ing smart­phone and mo­bile in­ter­net pen­e­tra­tions, as well as grow­ing economies and wealth.”

Ac­cord­ing to a re­search re­port by New­zoo and its strate­gic al­liance part­ner Talk­ingData, there were more than 16,500 mo­bile games across the many Chi­nese app stores last year, with more than 50 per­cent fall­ing into the ca­sual and card gen­res.

This was re­flected by the gen­res that saw the most new launches last year, with role-play­ing games and strat­egy games rep­re­sent­ing half of the to­tal, while ca­sual and card games rep­re­sented only 30 per­cent.

“This surge in role-play­ing games and strat­egy games on mo­bile is ex­em­pli­fied by NetEase’s Fantasy West­ward Jour­ney, a long­stand­ing PC game that was launched on mo­bile de­vices last year in re­sponse to the au­di­ence mi­grat­ing be­tween plat­forms,” ac­cord­ing to the New­zoo and Talk­ingData re­port.

With China com­fort­ably emerg­ing as one of the big­gest mo­bile mar­kets in the world, Chi­nese mo­bile de­vice mak­ers are also in­creas­ingly fight­ing one an­other over­seas.

New­zoo’s Global Mo­bile De­vice In­tel­li­gence ser­vice, which tracks close to 2 bil­lion monthly ac­tive iOS and An­droid de­vices across the world, shows dif­fer­ent de­vice man­u­fac­tur­ers are win­ning wars on dif­fer­ent fronts.

While Xiaomi is in a fierce bat­tle with Huawei for local dom­i­nance in China, the com­pany’s re­cent dis­ap­point­ing fi­nan­cial per­for­mance is re­flected in its un­der­whelm­ing over­seas suc­cess, where Huawei cur­rently rules the roost, ac­cord­ing to New­zoo’s data.

Though it has not found a way to the No 1 slot in for­eign mar­kets yet, One Plus, a smart­phone maker based in Shen­zhen in South China’s Guang­dong province, is qui­etly per­form­ing well abroad. This puts it on course to be­come the break­out brand from the coun­try’s de­vice scene.

Al­though Chi­nese hand­set man­u­fac­tur­ers are do­ing well in China, “it is im­por­tant to point out that Ap­ple is clearly the top de­vice brand (in the coun­try)”, ac­cord­ing to a Global Mo­bile De­vice In­tel­li­gence re­port pub­lished this month.

“Ex­am­in­ing the num­ber of de­vices ac­tu­ally used in a sin­gle month, rather than new units shipped, it emerges that Ap­ple has the largest mar­ket share in China,” the New­zoo re­port added.

“As local brands are able to pro­vide an in­creas­ingly high stan­dard of qual­ity and pol­ish, main­tain­ing this dom­i­nant po­si­tion in the long term is any­thing but guar­an­teed.”

Fo­cus­ing on Chi­nese brands, though, Huawei and Xiaomi are in close com­pe­ti­tion, with mo­bile de­vice mar­ket shares of 10.5 per­cent and 10.4 per­cent re­spec­tively in China.

The other ma­jor local brand in the top five is Oppo, in fifth place with a 7 per­cent mar­ket share.

“Away from home, Chi­nese de­vice man­u­fac­tur­ers have smaller mar­ket shares,” New­zoo said.

AFP

A man uses a HTC vir­tual re­al­ity mask to play a game at the Global Mo­bile In­ter­net Con­fer­ence in Beijing.

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