Research: Chinese Online Game Market Grew To $3.9 Billion In 2009

Research and consulting firm Pearl Research says that in 2009, the online game market in China grew 35 percent to $3.9 billion -- building on a 63 percent jump in 2008. Pearl Research managing director Allison Luong says that, similar to the West's Facebook gaming boom, much of the growth is being driven by Chinese social networking sites like QZone, Renren and Kaixin001. "These games are starting to cannibalize some of the advanced casual games on the market," she says. And the firm projects continued growth. According to Pearl's new research, the online game market in China is predicted to exceed $6 billion in 2012. Some of the region's most popular games see more than 1 million peak concurrent users, finds the research. These include games like NetEase's Fantasy Westward Journey, Giant's Zhengtu Online, Tencent's Dungeon and Fighter and Cross Fire -- and, despite its regulatory struggles in its transition to NetEase operations, Blizzard's World of Warcraft. Tencent was the top operator in the region for 2009, with $792 million in revenue. It's followed by Shanda Games, with $704 million, and then NetEase, with $493 million. Perfect World saw $314 million, and Changyou reported $268 million in revenue for the year. Nonetheless, there could be regulatory obstacles ahead for virtual goods. Pearl says virtual money is "under increasing scrutiny with a series of laws designed to tighten their use," like restrictions on what items can be purchased (only virtual goods) and how virtual currency may be allocated (not through lottery-based activities). 384 million Chinese are using the internet -- that's only 29 percent of the market. 70 percent of the internet users are under 30, and this is also the group most likely to seek out online entertainment like games, music and chatting, which Pearl asserts will be a net boon to the online game market.