Study: Chinese Game Market To Exceed $3 Billion In 08

Business intelligence and consulting firm Pearl Research has released results of a new study showing that the games market in China grew 60 percent to $1.66 billion in 2007 -- and is expected to exceed $3 billion in 2008. According to Pearl Research, rising average revenue per user (ARPU) in China will be key in 2008. The study found that popular online games in the region are reaching $7 to $12 per month in ARPU, higher than previously-charted averages of $5 a month or less. Pearl Research managing director Allison Luong says she expects ARPU in China to continue to grow alongside enhanced monetization streams for free-to-play games. Key findings of the study showed that Netease's Fantasy Westward Journey is China's most popular online title, supporting 1.66 million concurrent users at its peak. Following is Giant's Zhengtu Online, the majority source of the company's $209 million in revenues, with 1.52 million peak concurrent users. Additionally, game operators saw strong year-over-year revenue growth. Perfect World saw the largest percentage gain, with revenues up from 593 percent to $95 million, followed by Giant up 274 percent to $209 million. Shanda revenues grew 49 percent to $338 million, while The9 saw revenues rise 30 percent to $175 million. Giant and Perfect World, as well as NetDragon and KingSoft, were also part of what Pearl Research calls "a wave of IPOs." Pearl Research also conducted more than 200 one-on-one interviews with Chinese youth, and found that respondents viewed games as a social phenomenon in China, often playing casual games to connect with friends.