China’s unique core mobile games

This is clearly old news, but Chinese publishers and developers have been hyper-focused on the mobile market the past couple of years, and it has come to a point where at a macro level the Chinese mobile games market is looking significantly different from the western markets.

To present some simple data – according to a local analyst report from CNG, the top grossing mobile games of November in China were:

(The revenue unit is 100MM RMB, so for example 10.22 is 1,022MM RMB or $158MM – that’s a crazy monthly run-rate!)

A few immediate observations from this chart:

• Very high revenue estimate numbers. $158MM is a crazy monthly run-rate, and even if this was over-estimated by a factor of 5 it is still really impressive
• Heavily represented by core game genres taken from PC gaming. #1/2/3/4 are fairly typical MMOs for Chinese players (#1 & 2 are two different MMOs based on the Journey to the West lore, published by Netease); #5 is a card combat game leveraging the Kings of Fighters franchise; #6 is a mobile MOBA (that if I may say so looks quite like League of Legends…); #7 is an arcade shooter; #8/9 are the only western games on the chart, and are the typical western mobile strategy games; #10 is a casual puzzle game
• This is in stark contrast to what’s popular in the west – take the US for example, the top-grossing games still heavily skew towards casual games like Candy Crush and core PC genres like MMO / FPS / MOBA are not highly visible

Another way to look at the data above is to say, the biggest MMO globally in terms of revenue (and possibly player-base too) is likely a mobile MMO only available in China.

As a separate data point, last week Tencent also launched the mobile version of Crossfire, its top FPS on PC (and a regular $1B/year game for Tencent), to some strong initial traction (they announced 10MM downloads and 1MM PCU after 3 days). The Wall Street Journal also reported last week about Tencent’s ambitions to launch its other mobile FPS WeFire in the US after some success in the Korean market.

I think western developers have generally seen these core PC genres as extremely challenging to “port” to mobile. There have been attempts in earnest (e.g. studios like Gameloft have probably tried every PC genre on mobile), but certainly no runaway success like the Netease MMOs or the Tencent FPSes. A fundamental question that would be asked is “why would gamers want to play these games on mobile?”, and while the answer to that question generally applies to both western and Chinese gamers, there are some environmental factors that have made Chinese gamers early adopters here.

In a sense, these games start from the same low-end disruption thesis: they offer an inferior core gameplay experience (in terms of visual and input fidelity, etc.), but excels on accessibility (anywhere, anyone – everyone has a smartphone, any time – since gameplay loops have been optimized to be short sessions).

The diverging environmental factors that may contribute to the observed market difference are as follows:

• Chinese gamers are generally much less sophisticated and have fewer gaming choices. The Chinese gaming market is heavily skewed towards online games – for example, none of the GOTY nominees at the recent Game Awards have been officially published in China. There seems to be a strong desire to stick to the genres they are comfortable with
• More generally, Chinese gamers have fewer entertainment options, and gaming is the affordable entertainment option for everyone. So from a “jobs to be done” perspective, gaming in China fulfills a stronger role of connecting people socially, and gamers are used to this type of behavior (playing a MMO to be part of a community / make friends etc.)
• The broader market context of mobile adoption and mobile tech leap-frogging PC in China. Chinese consumers have been trained to be more mobile savvy (e.g. using mobile payments) in part because the legacy infrastructure was not well-developed (and therefore no switching cost, just adopting cost). Spending more time playing more hardcore games on mobile conforms with this macro-trend

To wrap up – I think it’s possible that China’s mobile games market today is where the western markets will head to in the future. Having played some of these chart-topping games I can say that they have found some core fun that should be universally appealing – the question is who will successfully replicate these formulas for western gamers.