Niko News Roundup: Perfect World Acquires Gamersky & 3DM

Tencent vs. Alibaba in the New Year

Tencent and Alibaba extend their rivalry in the revelry of the Chinese New Year celebrations. Messages sent via Tencent’s WeChat have replaced those sent via traditional text, and Tencent promoted sending virtual “Hong bao” (red envelopes with electronic delivery of real money) to friends and family rather than deliver paper envelopes with real money.

Alibaba has a well-established online payments system while WeChat’s is only just beginning, but the virtual hong bao may boost Tencent to a higher level. Alibaba launched its competitive Mobile Taobao Game Center in January, taking 20% profit for itself, 70% back to developers and 10% to be donated for a better cause. The two companies will continue to drive improvements in chat and ecommerce by competitively vying for the same large customer base.

Perfect World’s Shen Diao Xia Lu

Perfect World’s first self-developed mobile game, Shen Diao Xia Lu (Legend of Condor Hero) is among the highest grossing mobile games in China now. It currently has monthly revenue in excess of 50 million RMB ($8.2 million). Usage and revenues are steadily increasing for this popular iPad game. Gamelook reported that only a handful of mobile games in China have achieved more than 50 million RMB in monthly revenue.

China = Largest Market for Korean Games

According to Korean Cultural Industry Department’s statistics, in 2012 Korea’s exported game products shared 55.2% of total exported cultural products, and China was the largest market for that, importing 38.6% of Korea’s total exported game products. Many products from Korea such as Cross Fire, Dungeon & Fighter, and Dragon Nest are very successful in China.

Perfect World Acquires Gamersky & 3DM

In January, Niko wrote about how the Chinese government had shuttered console game distributor 3DM, and now it seems that the company will be revived by Perfect World. Perfect World has offered to acquire both Gamersky and 3DM, and has already acquired console game media company TGbus. Gamersky and 3DM are the leading websites for console games in China, yet their activity had been essentially illegal downloads of games until the ban on consoles was recently overturned. We still await the new detailed legislation for the console hardware and software segments.

America’s Biggest Companies Need Asia

Tech in Asia offers an overview of five big American companies and how they are relying on Asia in a big way to survive and grow, although they mention Lenovo, who is an Asian company to begin with. All of this just consistently points to the fact that companies, big and small, need to be aware of what’s going in China as it is critical to the future of companies across the globe.

Bloomberg recently interviewed Robin Li, founder of Baidu, and he was quoted as saying: “For a company to be successful internationally, they don’t need to be successful in the US. The US is just one part of the world. Maybe it’s hard for you to understand but for us, that’s the case.”

KongZhong Invests in Ourgame

KongZhong is a strong competitive Chinese online games operator that got its start in mobile games and then extended into online games such as Wargaming.net’s World of Tanks and other hits. Now the company is acquiring a minority stake in Ourgame, a company that a few years ago was a medium but important player in China’s casual games world. Ourgame was founded in 2004 by Korea’s NHN and a Chinese JV partner Sea Rainbow. NHN sold off its stake in Ourgame in 2011. We thought the company had faded away but evidently it is alive and well.