| Domestic online game industry on fast track |
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| 2008-03-20 09:33 CE.cn |
By Hu Hongjun
Chess and Poker on the Internet has become one of the major time-killing for Liu Jia. Working in an IT company, he spent about RMB400 on the Internet games in 2007. With the promotion of Liu Jia and his like, for the first time, the revenue of Internet game industry in China broke through RMB10 billion in 2007. And the domestic Internet game operators also scored brilliantly in the same year: companies like Kingsoft and Giant had listed in the stock market. As is pointed out by the experts, the Internet game industry is now making its way to the track of fast development.
Large market to be explored
After about 8 years of development, the domestic Internet game industry has formed the complete business chain that links developers of the upper stream, operators of the middle stream and the sellers of the down stream. The whole industry is now in a healthy development phase.
2007 saw a significant increase in subscriber number, game number and the market scale of the Internet games. According to the Investigation Report of Game Industry in China of 2007, jointly issued by the Game Publication Committee of China Publication Society and International Data Company, subscriber number of internet games was 40.17 millions in China by December 2007, which is a 23 percent increase above the previous year.
The report also predicted that by 2012, subscribers of Internet games in China will hit 84.56 million, and the compound annual growth rate in the period of 2007 to 2012 will be 16 percent. And in 2007, pay for game subscribers have reached 22.36 million, which indicated an increase of 31.3 percent above 2006.
The fast increase of subscribers brought about the rapid expansion of the Internet game market. In 2007, for the first time the sales of domestic Internet game industry broke through RMB 10 billion and hit RMB 10.57 billion, which was an increase of 61.5 percent above 2006. According to the prediction of the analyst of TeleR Telecom, in the coming years, China Internet game industry will undergo an increase with the annual complex rate of 30 percent.
Significant associated effects
The "monster" that could often be seen in the TV commercial of Coca Cola is a demonstration of successful partnership between the brand of the drink "Coca Cola" and the Internet game "Monster World". With the combination of the Internet game time, virtual rewards and the very real Coca Cola, the incentive was built for the fans of the Internet game to buy Coca Cola.
It is pointed out by the experts that such cooperation between various businesses could be translated into substantial financial advantage, and at the same time provides the means for the building of image and the rapid transformation for traditional businesses.
As a matter of fact, the rapid booming of Internet game industry has driven the development of associated industries. Statistics show that the direct revenue brought to the domestic telecommunication businesses by the Internet game industry hit RMB 26.11 billion, which was 2.5 times of the revenue of Internet game industry. RMB 9.76 billion of the direct revenue of IT industry in 2007 could be attributed to Internet games, and the revenue of IT industry includes PC, Internet game servers, internet storage products, software and services, etc.
Also, direct revenues in publication and media that are related to Internet game industry hit RMB 4.25 billion in 2007, which came mostly from the publication and sales revenues of the various papers, magazines, books and Internet media related to the game businesses.
Independent R&D comes to be a main stream
The excellent performance of the domestic Internet games could be attributed to the incessant breakthrough in the independent R&D. As is pointed out by Ding Lei�� CEO of Netease, independent R&D is the key to the survival and development of the domestic Internet game industry.
Favorable policies such as the preferential taxation and financial support for the Internet game industry were made available by the Ministry of Information Industry, the General Administration of Press and Publication, and the Ministry of Culture for the implementation of projects such as "Project of National Internet Game Publication of China". Under the promotions from the various parties, Internet game industry independently developed in China has acquired a strong booster. By November 2007, developers in China for Internet games have numbered 126, which was an increase of 35.5 percent above 2006. Internet games independently developed by 2007 have numbered 250, which was an increase of 14.7 percent above the previous year. Such independently developed games also had excellent market performance with actual sales revenue of RMB 6.88 billion of the domestic Internet games in 2007, which covered 65.1 percent of the total of the market.
At the same time, Internet game industry in China has sped up in the entering into the international market. In 2007, a total of 28 Internet games developed by 12 Internet game enterprises made their way into the international market with the sales revenue of $5.5 million, which was an increase of 175 percent above the previous year.
Insiders are expecting an even larger market share for such independently developed Internet games in 2008.
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