China set to remain a key market for mobile gaming even if growth is slowing down

Source:Global Times Published: 2016-6-8 0:33:22

The possibility that the days of exponential growth in China's mobile gaming market are behind us might precipitate a trend in the market for game developers to focus more on higher-quality games.

China is set to become the world's largest mobile gaming market this year, and is still expected to be one of the top areas of interest for mobile game developers, while other emerging markets, especially smartphone-obsessed India, aren't likely to turn into sizable gold mines for game developers in the near future.

However, following explosive growth in the past few years, China's mobile gaming market appears to be seeing a slight slowdown in its expansion.

China's mobile game revenues soared 47.6 percent on a yearly basis to total 41.51 billion yuan ($6.32 billion) last year, according to a research report released in March by Guangzhou-based market consultancy iiMedia Research. The growth rate is projected to slow to 23.9 percent this year, before sliding to 14.1 percent in 2018, said the report.

It is fair to say that China's market is going through something similar to what we saw in Western markets a few years ago when the very top games in the market made so much money that the overall market share was dominated by a small number of the very highest-quality games. For instance, Kabam, one of the world's major mobile game developers, has changed its approach from launching 20 games a year down to two games a year.

That said, China's marketplace for mobile games is still a major destination for global investors looking for opportunities in the sector.

India has risen to threaten China's leadership in the global smartphone market, with Counterpoint Research releasing findings earlier this year which indicated that India had surpassed the US as the world's second-largest market in terms of user base. But the gaming market in India is still relatively small.

Unlike China, where games on PCs were hugely popular prior to the advent of the mobile Internet era, India is virtually a brand new market for games. As a consequence, India will continue to be a small gaming market for at least another one or two years. But it's worth noting that India is an English-speaking market, which makes it easier to launch games that are already available in the US or European markets in India.

For game developers to bring Western games to China, a lot more effort is required to attune the games to the different taste of local people.

Indonesia and Brazil are also among the markets that are seeing promising growth, but none of them are likely to be comparable to the Chinese market in the short term. Uncertainties facing Brazil's economic outlook, in particular, are seen as weighing on investor sentiment.

The article was compiled by Global Times reporter Li Qiaoyi based on a recent interview in Beijing with Kevin Chou, CEO of Kabam Inc, a San Francisco-based mobile gaming company. bizopinion@globaltimes.com.cn

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