China Online Gaming

Bill Bishop writes:

Here are what I see as some of the takeaways from the results this week:

1. The China game market is still large and growing but the revenues are spreading across more companies (Duh, but some folks believe it is collapsing);

2. Gamers care about content a lot more than they care about distribution (and with Bittorrent and online payments physical distribution will become increasingly marginalized), and no company has or will have a lock on game distribution and publishing in China;

3. The top 3 publishers have very weak pipelines, and right now none of them has anything particularly promising for at least the next 2 quarters (I think longer, given how hard it is too actually release a 3D game like Dungeons & Dragons or Tianxia);

4. The free model has taken off here and is really making in dent in all the games except, it appears, World of Warcraft. And the dominant incumbents are going to have a hard time cannibalizing their fee revenue games to compete with the free ones;

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Rajesh Jain

An Entrepreneur based in Mumbai, India.