[{"_1":2,"_91":-5,"_92":-5},"loaderData",{"_3":4,"_6":7},"root",{"_5":-5},"user","routes/tag.$slug",{"_8":9,"_79":80,"_88":82,"_89":66,"_90":67},"posts",[10],{"_11":12,"_13":14,"_15":16,"_17":18,"_19":20,"_21":22,"_23":24,"_25":26,"_27":28,"_29":30,"_31":32,"_33":-5,"_34":35,"_36":37,"_47":48,"_72":73,"_74":75,"_76":77,"_78":32},"documentId","yl4a0a2jyucfa9oe1k8kbc5u","title","How Mobile Gaming Conquered China","slug","how-mobile-gaming-conquered-china","excerpt","Chinese gamers have historically been staunch PC buffs, but it was rather a Hobson’s choice. From 2000 to 2015 buying an Xbox or a PlayStation was not an easy feat for local youths, since most consoles were simply banned from official sale. ","content","\n

Chinese gamers have historically been staunch PC buffs, but it was rather a Hobson’s choice. From 2000 to 2015 buying an Xbox or a PlayStation was not an easy feat for local youths, since most consoles were simply banned from official sale. In fact, for many teens in the beginning of the 2000s, even building a decent gaming PC was a quest of great expenditure, thus their only choice for virtual socializing fell on internet cafes that were all the rage in China just 10 years ago. Consoles eventually came about, but proved to be expensive not only in hardware, but also in software, since most PC games at the time were downloaded illegally to avoid any extra costs. However, there was one more reason behind their failure – the advent of smartphones.

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Smartphones, especially the ones produced in China, were way cheaper than an average PC, way more compact than any laptop and, above all, omnipresent. They became the common playground for the droves of thrill-hungry Chinese teens and white-collar workers and laid the foundation for a buoyant new industry.

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Currently China is the world’s top mobile game market. As of February 2018, the country had 1.28 billion mobile internet users, with roughly 1.03 billion or 71.6 percent of those connected to 4G. Over a half of these people play games on their smartphones, driving the industry’s annual revenue up to $20 - 30 billion in 2018 by different estimates. It is expected that by 2022 the numbers will reach over 700 million gamers and $30 - 40 billion in revenues. Foreign games make up only a small fraction of those earnings totaling just 4 percent in 2017.

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China is largely an Android country with the Goggle’s OS installed on 79 percent of local smartphones, while iOS comes second with only 20 percent. Ironically, while Google developed mobile interfaces are all over the place, the Google Play store is banned. The void is filled by nearly 400 third party Android marketplaces. Still, iOS is hardly feeling left out. By 2017 Chinese App Store raked in almost 40 billion downloads and $27.7 billion in revenue, more than any other country except the United States. As per some estimates, a typical Chinese user tends to have around 24 applications on their smartphone, a quarter of which are usually games. Their average annual revenue per user reached $31.3 in 2017.

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Reasons behind this dynamic are manifold: from the ban on consoles in the beginning of the 2000s to the current lifestyle of the majority of China’s population. According to some studies, an average Beijinger spends nearly two hours every day commuting. This is also the case in other big cities like Shanghai and even worse in some smaller cities like Jinan, the capital of Shandong Province, where a vast network of underground springs precludes the construction of a Subway, making its roads the most congested in China and forcing commuters to spend up to six hours a day switching buses. In contrast, an average UK citizen commutes only for 90 minutes a day.

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Furthermore, the soaring property prices are pushing millions of workers outside the city limits into the suburbs and small commuter towns. Beijing is one of the world’s most expensive renting destinations, with an average price 1.2 times higher than an average salary. For many, there is little choice outside taking a long subway ride to work, and mobile games are an easy way to kill the time. Especially since they are free.

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Role Playing Games (RPGs) and strategy games are currently among the most popular. Honor of Kings or Arena of Valor as it’s known outside China (think of a cruder Dota) and PlayerUnknown’s Battlegrounds (sort of like Fortnite) share the top spot. According to Tencent, popular games also include some more casual categories like chess, matching and racing games.

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Chinese gamers usually prefer Chinese games based on local themes and cultural staples. Generally, games inspired by the novel Journey to the West or any other piece of epic local ancient literature does well on the charts.

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Two of the biggest Chinese game companies are the inescapable Tencent and NetEase, which routinely rival each other in the top 10, trying to win over the consumers. Tencent is currently the largest gaming company in the world, and their portfolio does not only include Chinese games. The company actively invests in foreign studios, among which is, for instance, Epic Games, the developer of Fortnite.

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There are twice as many mobile gamers in China as people in the United States. Unsurprisingly, companies servicing all that demand abound. Out of approximately 2,300 registered firms 31 percent are game developers, while the rest deal with distribution and other services and try to keep up with the constantly transforming landscape shaped by people’s rapidly changing tastes. The average lifespan of a game in China is not long: people quickly accumulate (or buy) rating points to boast before their friends and then move on to the next big game. Besides, buying one’s way to the top is considered an absolutely legitimate way of winning in China, unlike most other markets where it would be perceived as cheating, hence the immense revenues.

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Sadly, China’s mobile game industry is not all fun and money stacks, it’s also a struggle for survival against draconian regulations. The local government has been concerned with the addictive nature of gaming since the very arrival of first video games. The 2000 – 2015 ban on consoles was just one of the steps that officials took to curb the assumed negative effects of gaming. When arcades – which in modern China are effectively a form of low stakes gambling – became a trend, the government pulled a plug on them too, only to pull it back shortly.

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In 2018, concerned about the new mobile gaming craze, the government stopped releasing approvals for new games, essentially banning any new titles from going for sale. Tencent’s stock took a blow, falling about 25 percent, with NetEase losing over 35 percent of its 2017 price. The ban was lifted at the end of 2018, allowing for new approvals to be released, yet the huge inflow of games created a backlog, forcing authorities to pause again to process the first batch of games, before moving onto the rest. In essence, the ban still persists, yet, despite all these stringent regulations hordes of young Chinese gamers can still be seen enthusiastically tapping their thumbs against smartphone screens pretty much anywhere in China.

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Tag: #Mobile Gaming

How Mobile Gaming Conquered China