What’s On

Mobile games grow in China

Chinese consumers spend significant amounts of time and money on mobile gaming, which is attracting the attention of publishers of PC games and app stores while also driving the smartphone market. One such is Perfect World Co, a Nasdaq-listed Chinese games developer.

“Perfect World will release more mobile and browser games later this year to expand its presence,” Xiao Hong, chief executive of the company, told China Daily. “Although the company’s major products are PC games, it will closely watch the mobile sector because of its promising prospects,” he added. Statistics quoted in the newspaper indicated that consumers devote almost one third of their time on mobile devices to playing games. More than 250m did so in the final quarter of 2012; the sector was large, growing and projected to be worth around $3.2bn by 2015.

The same trend was noted in a recent study from Draftfcb, which reported that mobile users in India and China typically used their phones to play games more than they did to make calls, and suggested there was an opening for brands to reach them via this route. In addition, for developers such as Perfect World the profit figures appear more enticing because of the increasing number of users prepared to pay for gaming apps.

“Chinese players are more willing to buy mobile games than to purchase PC games,” said Hang Guoqiang, manager of an internet industrial park funded by China Mobile, noting that “profit efficiency in PC games was around 1-2%, while the rate was 7-30% in mobile gaming”.  He added that more than a quarter of the players are paying 5 to 10 yuan a month for mobile games.

David Liu, chief executive of gaming company RedAtoms Inc also noted that 80% of the top games in China offer in-app purchases. He suggested the best business model for developers was games that are free to play but which offer premium services for payment.

That may not be the best for everyone, however, as Analysys International, an internet information company, reported that more than 90% of the revenue generated by professional gaming distribution platforms came from selling apps to smartphone users.

With smartphones offering better gaming features, more consumers are opting for these and some estimates put the smartphone penetration rate at 55% by the end of 2013.

Published with permission from WARC