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China Angle: 'China Games And The Troubles'
China Angle: 'China Games And The Troubles'
March 25, 2008 | By Frank Yu

March 25, 2008 | By Frank Yu
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[In Gamasutra's latest China Angle column, Frank Yu says that while China's online population is booming, the games industry is growing increasingly nervous about government crackdowns following the shuttering of online video sites, and looks at recent controversy over the Beijing Olympics website's co-option of some casual games.]

First the good news

March has seen a spate of problems hit the Chinese Internet from blocked sites to allegations of “cloning” casual games on the official Beijing Olympic website. However, this month also serves as a milestone in some respects as China has now become by some estimates the largest Internet population in the world with 228 million users vs. the 217 million in the U.S. Note that those numbers are users and not revenue, which would place China far lower in rank.

Nevertheless, more users also mean more gamers as expectations rise on the continued growth of the China game industry. Strong revenue numbers from the major Chinese game companies and positive reports from research houses support the momentum for continued growth and expansion for the industry. Not only are more people playing games but they are actually (gasp) spending more as well.

Now comes the bad news

All this goodness comes with a bit of trepidation as other events unfold that could rain on the parade. The China game industry is cautiously observing how the government has been dealing with video sharing sites and is asking itself “when is it my turn?” The government has shut down 25 “illegal” video sites and served warnings to the #1 domestic site Tudou and 32 others in the latest crackdown.

Video sites, as entertainment sources, overlap with the same customers as online game companies which makes many in the industry nervous. How and why a site is considered illegal remains open to a debate mostly determined by the regulatory agencies. This state of affair worries many people in the game industry who operate, sometimes by necessity, in a nebulous state of legal operations.

In other issues, the protest in Tibet has caused many western sites to be blocked in China for a few days or longer like YouTube. This brings up another point for potential anxiety for Chinese game developers with global aspirations. For those operating in overseas markets, Chinese games and companies could serve as a visible magnet for both criticism and attacks on Chinese policies just as American companies become targets due to American foreign policies.

Game companies in China take great effort in trying to keep politics out of the game in domestic play. However, as more and more Chinese games develop overseas customers, the potential for game worlds to become a focus of backlash and protest increase as well.

Nationalism and cyber mobbing has occurred in the Chinese MMORPGs in the past with brawls and demonstrations against Japanese and sometimes Korean players. Keeping the forums and the game worlds from erupting into open flame wars will still be a challenge for any operator foreign or domestic in China in the next few months.

The coming Beijing Olympics will put the whole country under the close scrutiny of the global media and public opinion. In one particular gaffe, Ars Technica documented how some of the free games on the official Beijing Olympics website resembled the excellent play style of the minigames from the Orisinal website.

This is a bit funny since most casual game developers have in some way “flattered” or borrowed ideas from many commercial and public domain games in the past as well. However, since this is the official Olympic site, the outcry came and the games were taken down since. Any other site and it would not have been as big a deal.

Beware of the Ides of March

March 15 marked the official China consumer rights day. This is the day when consumers around the country lodge complaints and get educated on how best to protect their consumer rights. As a sign that the industry still has far to go in better customer service, the #1 complaints were in online sales and games.

Online beat out retail and mobile services for being the primary consumer headaches with identity theft and hacking of accounts becoming a major threat to consumer confidence. When the largest complaint by people is online services in the largest online population on Earth... that’s a lot of people.

[Frank Yu is a director of strategy at eCitySky Beijing. Prior to his current position, Frank started and led the first China game team for Microsoft Casual Games. He has also served as the first Regional Business Manager in Asia for the Xbox and Home Entertainment Division. He can be reached by email at capital@gmail.com].


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