DFC Intelligence Forecasts China Online Games to Reach $1.7 Billion by 2010.

SAN DIEGO -- A new report from DFC Intelligence forecasts that the online game market in China will grow from $580 million in 2005 to $1.7 billion in 2010. This does not include any potential revenue from traditional video game console or handheld systems. According to Alexis Madrigal, lead author of the report, "because of piracy concerns China has been forced to pioneer new business models for video games. The game market in China is all about online play and charging by usage. There is even a growing market for the items used in games like weapons and characters."

With the recent introduction of Vivendi Universal Games/Blizzard Entertainment's World of Warcraft, it has been shown that western content can have strong appeal in China. Nevertheless, the Chinese market remains extremely difficult for foreign companies. A company entering the Chinese market must compete with the increasingly sophisticated domestic Chinese game companies. On top of that, there is the rampant piracy problem, extensive government regulation and a market that is already overcrowded with products. "Because the top games in China can generate as much as $100 million a year for several years, at first glance the market looks very attractive," says Madrigal. "However, it is clear that margins are headed down as the business matures."

The new report, The Game Market in China, is over 350 pages and contains forecasts for China online games through 2010, complete business model analysis, extensive company profiles, a discussion of popular and emerging game genres, a look at government regulations, piracy and the telecommunications infrastructure and case studies of product launches. More information is available at http://www.dfcint.com/game_report/China_GameMKT.html.

DFC Intelligence is a market research firm focused on video games, PC games, online games and interactive entertainment. They offer free monthly research briefs to anyone signing up at http://www.dfcint.com/mailing_signup.html. Other DFC Intelligence reports include Worldwide Market Forecasts for the Video Game & Interactive Entertainment Industry, The Business of Computer and Video Games, The Online Game Market, and Market Leaders in the Video Game and Interactive Entertainment Industry.