Young men play online games at a recent Internet expo held in Beijing. Domestic online gaming businesses made significant progress last year, but the government will continue to strengthen its support for the sector's development, said officials and industrial executives.
BEIJING, Jan. 21 -- China's online gaming industry
made significant progress last year, and the government will continue to support
its development with advantageous policies, said officials and industrial
"It was a year of change in the competition scenario
of the online gaming market in 2004," Kou Xiaowei, deputy director-general of
the Audio, Visual, Electronic and Internet Publishing Department under the
General Administration of Press and Publication (GAPP), told the first China
Game Industry Annual Conference in Guangzhou.
He said domestic games accounted for more than half
of the nation's online gaming market in the past year, a significant shift from
the heavy reliance on imported games in the preceding three years.
According to a report from the China Game Producers'
Association, sales of online games reached 2.47 billion yuan (US$298 million) in
2004, a year-on-year rise of 48 per cent. The number of online gamers also grew
to 26.33 million.
Due to the boost from online games, Chinese telecom
operators also raked in 15.07 billion yuan (US$1.82 billion) in Internet
connection fees and IT firms received 6.37 billion yuan (US$769 million).
The association predicts sales of online games will
grow at an average annual rate of 34.7 per cent, reaching 10.96 billion yuan
(US$1.32 billion) in 2009.
China has attached great importance over the past few
years to the development of the domestic online gaming industry, including
establishing an industrial fund, offering tax incentives, and supporting their
research and development capability.
Niu Shuguo, chief of the IT Industry Administration
division of the Shanghai Informatization Commission, said companies making
high-quality online games will enjoy the same preferential treatment in terms of
taxes and in leasing land as those offered to leading software companies in
He noted that Shanghai is also working hard to help
the over 30 online game companies build up their brands.
Shanghai is the most important online gaming base,
the home of China's biggest online game operator Shanda Interactive
Entertainment and NASDAQ-listed The9.
With encouragement from the government and the fast
growth of the industry, 73 gaming companies have developed or are developing 109
game titles and 21 games are already in operation. Their combined market share
has already grown by 50 per cent.
GAPP's Kou said the Chinese Government will continue
to support the development of domestic gaming companies.
The country will establish several Internet
technology innovation centres based on large game operators' capabilities.
GAPP will organize a domestic developers' conference
in the first half of the year and a domestic game contest in the second half of
2005 to help game developers and operators share their experiences and improve
Kou predicted that in the next five years, at least
300 game titles will be developed by domestic firms.
However, the lack of skills will remain a major
problem in the industry.
The GAPP official estimated that the industry will
need at least 20,000 game developers in the next five years, but there are just
under 5,000 at present, meaning the development of local design capability will
be severely curtailed.
As a solution to this, China plans to establish a
professional game college to train senior talent for the industry.
At the same time, the Chinese Government will select
10 universities in the country to open gaming majors.
Shanghai also held two game development contests to
discover talent in the industry and recommended them to work for industry
leaders like Shanda and The9.
China will also encourage domestic game companies to
go overseas to develop their businesses on a broader platform through exports or
Besides improving local development capacity, GAPP
will release a regulation on the publication of online games with the Ministry
of Information Industry and revise the administrative regulation on electronic
publications, to stop pirate servers of online games as well as online gambling
and create a healthy environment for the industry.
(Source: China Daily)