SOURCE / COMPANIES
Giants and newer entrants seek presence in global gaming market
Published: Mar 23, 2021 07:43 PM


A user plays a China's locally developed game. Photo: IC

A user plays a China's locally developed game. Photo: IC



Chinese gaming companies are accelerating the business expansion in overseas markets during the first months of 2021 following a big push for expansion last year. 

ByteDance said on Monday it is acquiring Shanghai-based gaming studio Moonton Technology, as it seeks to further expand into the video games business and explore the global game market.

The acquisition has put the owner of TikTok and Chinese short video platform Douyin in direct competition with China's Tencent as China's gaming giants and newer entrants are driving effort to go abroad and seeking a bigger presence in the world's video games market.

In 2020 China-developed video games made $15.45 billion in sales revenue from overseas markets, up by 33.25 percent on a yearly basis and the growth rate is 12.3 percentage points higher year-on-year, according to statistics in the China Gaming Industry Report.

China's leading gaming companies have spent a great deal of money and resources on game development this year.

Tencent alone has invested in 27 game companies in the three months of 2021, according to data compiled by CYZONE, almost equivalent to its whole year investment portfolio last year.

In addition to ByteDance and Tencent, Kuaishou, a Chinese video-sharing mobile app, is also accelerating its outlay on gaming. Rakshasa Street: Wargod, a strategy card game distributed by Kuaishou, has amassed more than a million new players on debut last Thursday. The company said it will keep developing hardcore games going ahead, with large-scale recruitment in Beijing and Shanghai this year.

The accelerated expansion of these giants come as Chinese gaming companies look abroad in search of new revenue, Zhang Yi, Internet analyst and CEO of Guangdong-based iiMedia Research, told the Global Times on Tuesday.

A survey on domestic gaming enterprise showed that 65.38 percent of the enterprises polled carried out overseas business in the first half of 2020 due to the incentive of some successful cases of domestic games going abroad and the easier access of distribution approval in overseas market compared with a tighter regulation at home.

More and more companies are looking to overseas markets, because of the strong payment functionality and high loyalty amongst overseas users, Sun Hui, chairman and CEO of Beijing Lucky99 Software Technology told the Global Times on Monday.

Chinese developers' good performance proves that China has already become a key driving force in global game development, he added. 

Strong performance 

According to the data released by SensorTower in February, a total of 37 Chinese mobile games crossed $100 million revenue in overseas market in 2020. The overseas revenue of top 30 Chinese mobile game products on App Store and Google Play increased to $9.24 billion from $6.3 billion in 2019, up 47 percent.

Divided by major markets, five out of top 10 games on App Store are from China in March. As many as 40 Chinese mobile games were shortlisted in the top 100 of South Korea's best seller list in Q4 in 2020, gaining revenue of $300 million while 30 Chinese mobile games were shortlisted for the top 100 of Q4 Japan mobile game market in 2020, according to SensorTower.

With the improvement of the quality of domestic games, the presence and voice of Chinese original games in the global game industry are improving, Tang Yanwen, CEO of Shengqu Games, told the Global Times on Tuesday.

The Shanghai-based company saw 70 percent revenue growth in overseas market in 2020 and its title Fallout: Shelter Online topped Japan's iOS free download list and Google Play free list, and won the second place in South Korea's iOS free download list.

"The growth of global game market demand during COVID-19 has driven company's overseas revenue as a whole. The export of high-quality content and IP products overseas also help the company to win more users and market share," Tang said, adding that China's mobile game industry has developed faster with considerable competitiveness in the global market.

At the production level, the design and the whole playing logic of China's mobile games are currently among the top in the world based on its testing to hundreds of millions of domestic users, Zhang said.

"Many games are first launched onto the domestic market, meaning they have been tested and approved by at least 100 to 200 million users. Very few game companies can reach this scale of users," he said.

In addition to hardcore design, the domestic games also pay much attention to the user-centered experience and cultural exports.

"Games based on Chinese culture are easily recognized by users from the Asian culture circle, for example those from Japan and Southeast Asia," Sun said.

Graphics: GT

Graphics: GT



Bright prospects

Large scale players are expecting a better performance for Chinese gaming companies this year when the overseas pandemic has caused a large number of foreign enterprises to stop operation and the global population still relies on spiritual entertainment as a means of relaxing during pandemic.

"The game itself is also a cultural product, which plays a great role in cultural exchanges and is in line with China's strategy of globalization and economic development," said Zhang.

"As China was the only major economy to see positive growth in 2020, there is enough reason for the world to have high hopes and confidence in China's products and its ability in the gaming industry. China's gaming industry also has enough reserves and capabilities," he added.

Tang said Shengqu Games will promote the existing games to a wider regional market, including Europe, the US, Japan and South Korea as well as launch seven new games to the global market this year.

"At the same time, Chinese game manufacturers are further exploring the platform connectivity of games, and even cloud gaming, a future game mode, to seek an advanced place in the industry," Tang said.