A pair of editorials from the latest Korean IT Industry Promotion Agency newsletter indicates that the Chinese market share of Korean online games, which was previously a dominant section of the industry, has shrunk in the wake of greater efforts from native Chinese developers to develop and promote their own online games.
Chen Hao's column provides statistics detailing the decline in market share. In 2003, Korean online games made up 68% of the total Chinese market in online games, a figure which dropped precipitously to 38% in 2004 and 20% in 2005. "I am concerned that many Korean firms are too caught up in illusions of grandeur to clearly understand the situation in China," said Hao.
According to Hao, the key missing element in Korean online games is satisfactory support and maintenance for the Chinese versions of the game. "Localization in China involves more than translations of products. It involves finding a great partner, an expert administrator, and a talented developer. Critical to the success of the localization is adjusting the game contents to meet the different preferences of each region."
Columnist Jin Hua picked up the theme, discussing successful Chinese-developed online games within the country. Hua cited iResearch's findings that the market share of Chinese games grew from 14% and 360 million yuan ($44.48 million USD) in 2003 to 27% and 10.04 billion yuan ($1.24 billion USD) in 2004.
Hua gives three reasons for the increased market share of Chinese games: first, the increased development capacity of Chinese firms; second, a welcoming market for Chinese-developed product; and third, support from the Chinese government. "The Chinese National News Publishing Authority is pursuing the 'Chinese National Online Game Development Project,'" according to Hua, "in order to promote China's game publishing industry, strengthen competitiveness of the online game sector with independent R&D, and provide the youths of China Chinese culture and beneficial contents through online games."