New Report Shows That Most Of China’s Gamers Are Still Playing On PCs, Not Mobile

A new report from China’s GPC (link via Google Translate), an industry group for game publishers, shows that China’s video game industry is now worth 83.17 billion RMB (or $13 billion), a 40% increase over the past 12 months (h/t Games In Asia). While the growth is not surprising, the fact that most of that revenue came from PC-based games may be, especially considering the amount of attention that has been focused on the rise of mobile in China. Most of this year’s revenue, 64.5% or about $8.7 billion, was generated through client-based PC games. Browser games took in a comparatively low $2 billion, while mobile games earned just $1.8 billion. Social games–which many developers depend on to spread the word about their products–earned less than $1 billion. As Games In Asia notes, most browser games can’t be played easily on mobile devices, so these figures mean that PC games made up more than 80% of revenue earned by China’s gaming industry in 2013. A lot of focus has been placed on the rise of China’s mobile gamers. For example, Tencent gave mobile developers a potentially lucrative outlet when it launched messaging app WeChat’s highly anticipated gaming platform. Several China-focused mobile game companies have also recently picked up significant funding. These include Chukong, one of China’s largest mobile game developers, which recently raised a $50 million Series D led by New Horizon Capital, bringing its total funding to date to an impressive $83 million (its existing investors include GGV Capital, Sequoia Capital’s China fund, Disney’s Steamboat Ventures and Northern light). Another mobile game developer in China that recently received funding is Beijing-based Yodo1, which announced a $11 million round from GGV Capital earlier this month. Developers are busy figuring out how to cope with the challenges that come with distributing and monetizing mobile games in order to take advantage of China’s rapidly increasing smartphone penetration, and they have good reason to. There are more than 500 million Android and iOS devices in China, according to top analytics firm Umeng, and that number is expected to grow to 800 million next year, and top-grossing Android games can make $5 million to $10 million per month. Smartphone penetration is growing rapidly in Asia and, as in other markets, most of the time players spend in-app are on games. As a result, many developers have focused on HTML5 to help them develop casual games that can be played on different mobile OSes, as well as figuring out a distribution strategy for China’s highly fragmented app marketplace. Developers shouldn’t ignore PC gamers. But the report from GDC shows that game developers who want to be profitable should consider developing a multi-channel strategy, too. Another nugget of insight from the report is that even though the list of top developers in China is still dominated by foreign companies like Electronic Arts, Gameloft and Glu, domestic game companies are starting to take a bigger chunk of revenue–$7.8 billion to be exact, or a 30% increase year-over-year.