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Kliuless? Gaming Industry ICYMI #3

Each week I compile a gaming industry insights newsletter that I share with other Rioters, including Riot’s senior leadership. This edition is the public version that I publish broadly every week as well. Opinions are mine.

Hi, my name is Kenny Liu, and I work in Revenue Strategy at Riot Games. Each week I compile a gaming industry insights newsletter that I share with other Rioters, including Riot’s senior leadership. This edition is the public version that I publish broadly every week as well. Opinions are mine.

See more or subscribe at:

Kliu's Corner: China's Transition to Innovation

  • Current Events
    • Despite all the hype this week surrounding Call of Duty: Black Ops 4 Blackout, in my opinion Tencent's "Ring of Elysium is the most exciting battle royale launching this fall"
    • However, what excites me the most about RoE is not its dynamic weather system nor the fact that its free-to-play, but rather what it heralds for the future of Chinese games: innovation
    • I love this quote from a Chinese gaming executive: “Going overseas is just like swimming – when there’s a flood one day, you’ll realize it’s a survival skill"
    • That flood has finally arrived as China's freeze on new video game licenses may last another 4-6 months
    • "Amid the current uncertainty at home, Chinese game developers are ramping up international marketing. In the first half of the year overseas sales of China-developed titles reached US$4.6bn, up 16% year on year, outpacing the 5% y-o-y growth in the industry overall"
    • Aside from Tencent's RoE, this week NetEase announced that mobile PUBG clone Knives Out is heading to PlayStation 4, and China’s biggest anime video site Bilibili previewed two games on Steam
  • Context: The Scramble to Ship
    • Over the past couple of years, China's gaming giants, Tencent and NetEase, have rapidly grown their development capabilities in the fight for mobile battle royale market share
    • After PUBG Steam Early Access began on PC in Mar-2017, NetEase’s mobile clones, Knives Out and Rules of Survival, launched 8 months later in Nov-2017
    • After that, Tencent’s two PUBG Mobile games only took 4 months to ship in Mar-2018, and quickly dethroned NetEase's titles partially due to their official licensed branding
  • Context: The Scramble for IP
    • As Chinese mobile gamers' tastes evolved to seek higher quality experiences, this year Tencent and NetEase both scrambled around the world to sign numerous deals with Western partners with well-known IPs:
    • China

      External Party





      Minority interest ($100M)

      China publishing (maybe)




      EVE-themed mobile AR MMO



      Joint venture

      Game development studio




      Call of Duty mobile game



      Minority interest (10%)





      Red Alert mobile game


      Grinding Gear Games

      Majority interest (80%)

      Path of Exile




      Online games


      Square Enix

      Co-development (& JV?)

      New games (& maybe IP licensing)



      Minority interest (5%)

      China publishing

  • Next Step: Innovation
    • What each of these collaborations signify is really an in-depth learning opportunity for both Tencent and NetEase to understand how to layer innovation on top of their already incredibly fast production processes
    • With each co-development project, they learn how to incrementally raise the quality bar of their games
    • I personally have already been impressed by NetEase's game design innovations in two of their mobile titles: Identity V and Inhuman Academy
    • However, I think the game with the greatest to-date harbinger potential for this incoming trend could be Tencent's Ring of Elysium, launching next week
    • Even if RoE is a flop, Chinese games will doggedly continue to penetrate Western markets because of the current state of competitive dynamics domestically: e.g., high market saturation, uncertain regulatory climate, Tencent's monopoly power (which discourages fragmentation and also blocks NetEase), etc.


  • HBR: Design Thinking Is Fundamentally Conservative and Preserves the Status Quo
    [KL: please forgive the clickbait title]
  • Mark Brown: Playing Past Your Mistakes
  • 7 great stealth encounters in games that are worth studying


  • Ars Technica: "Valve walks us through Artifact’s new demo, leaves us wanting more"
  • Diablo III for Nintendo Switch launches November 2
  • PUBG’s 1+ million CCU streak is over precisely one leap year after it began


  • Fortnite beta invite to download conversion rate on Android similar to iOS, resulting in 15M downloads sans Google Play
  • New social features in Pokémon Go grow active users by 35%, and PvP to launch at end of 2018


  • 1/3 of China’s population (459M) plays mobile games, and other great visualizations of current state of gaming in China 

  • >90% of Chinese teens access the internet through mobile phones
  • Apps Within Apps: UX Lessons from WeChat Mini Programs
  • Dual SIM slots and gold iPhones: Five ways Apple is embracing China


  • Stratechery: The iPhone Franchise
  • Facebook’s next big augmented reality push is multiplayer games
  • Peter Calloway to Adapt ‘Alan Wake’ for Television
  • Netflix & YouTube are most throttled mobile apps by U.S. carriers, new study says
  • Apple says Watch, AirPods, and chargers will be more expensive under Trump tariffs


  • Developing Spore: An oral ('Sporal'?) history 10 years on
  • Exploring the First Microprocessor Video Games
  • The Verge: The 25 Games We Can't Wait to Play This Holiday Season
  • Ars Technica: The 16 surprising new games that made PAX West an absolute blast
  • Indie devs can now use the same voice-comms tool as Fortnite for free
  • NYTimes: How Game Apps That Captivate Kids Have Been Collecting Their Data
  • Database of Software “Fingerprints” Expands to Include Computer Games
  • The YouTube stars heading for burnout: ‘The most fun job imaginable became deeply bleak’
  • Minecraft Team partners with Target for new merch and in-store events
  • Top Chinese indie game is about the existential crisis of a candle
  • China's combination of Yelp, Seamless, Uber and more, Meituan Dianping lets users order a range of services all within one app, like food delivery, restaurant deals, movie tickets or hotel bookings
  • HBR: The #1 Office Perk? Natural Light

See more or subscribe at:

Twitter: @kliuless
LinkedIn: @kliuless

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