Sino Global Capital

Oct 11, 2021

6 min read

China Gaming Industry at a Glance

Introduction

Executive summary

  • By the first half of 2021, Chinese gaming users had reached 667 million.
  • The actual sales revenue of the Chinese gaming market for the same period was CN¥150.5 billion ($23.3 billion), a year-on-year increase of 7.89%.
  • Domestic market sales revenue of Chinese indigenously developed online games was CN¥130.1 billion ($20.1 billion), an increase of 8.3% year-on-year, and continued to maintain more than 80% market share.
  • China’s indigenously developed games have been increasing their dominance of market share. The actual growth in sales revenue of China’s self-developed games in the domestic market has increased at a rate of at least 15% per year since 2014.
  • Tencent, NetEase: Gaming giants took in over CN¥200 billion ($30.9 billion) in game revenue last year. In 2020, Tencent’s game business revenue was CN¥156.1 billion, dominated by mobile gaming; reaching CN¥146.6 billion; NetEase’s online game net revenue for the year was CN¥54.6 billion, exceeding CN¥50 billion for the first time. (Source: https://finance.sina.com.cn/jjxw/2021-05-03/doc-ikmxzfmm0327440.shtml)

China Gaming Industry development

At time of writing, Tencent and NetEase (网易) developed games dominate the iOS download charts in the China app store. Top genres include action (动作), card games (卡牌), strategy (策略), RPG (角色扮演), sim (模拟) and adventure (冒险). Source: Qimai.

What GameFi companies targeting Asia can learn from Chinese gaming habits

  • These gamers are eager to sport rare skins and collectibles “in-game” as a status symbol; a potential fit for the collecting and trading of collectibles via NFT technology.
  • Mobile is by far the most preferred media of gaming, with most being apps downloaded and connected to third party apps owned by the developer. Given that most crypto games are web based, a mobile first design at a minimum may make more sense.
  • RPG games, card trading and strategy are all popular, which are perfect use cases for NFT technology above aesthetic collectibles. Here, NFT based skills and upgrades could be used to create, for example, advanced battle scenarios.
  • Many of the most popular games in China have a heavy cultural / historical flare; themes around the story of Journey to the West (西游记) and heroes, real and mythical, from the Three Kingdoms (三国) are incredibly popular. The 4th most popular game in the iOS app store in China is “Fantasy Westward Journey”, an MMORPG inspired entirely by the story of Journey to the West. Localization is no less key for success in attracting customers in other Asian markets. Adding themes, historical references and characters from antiquity can be key attractions.