Giant Interactive Searching for New Business Model

Several media has revealed today that the CEO of Giant Interactive (NYSE:GA) has been paying visits to several other online game companies such as Shanda, Tencent and Kingsoft, in search for  a partner/partners to co-operate their online games. It is also confirmed by the source that they have almost come to an agreement with at least one of the three mentioned.

The best known example for the model of Co-running online games is Chengdu Dream Factory, who didn’t get shuffled out of the business when the big game companies moved in, but thrived with the Co-running model, making a revenue of 200 million CNY in 2008 by working with Tencent, Lianzhong, Netease and others.

The model is to merge the strong advange of game development from companies such as Chengdu Dream Factory, and the publicity as well as operation management of game operators such as Tencent and Netease, in order to make the most of the game and push to the widest audience possible.

Nevertheless, this model hasn’t been quite popular even though we see living examples successful; but if public listed game companies such as Giant Interactive is going to be one to practise such model, it will definitely shake the industry in China.

The purposes of Mr. Shi’s intention of Co-Running games is not only it will help their earnings look better as Giant Interactive Q3 earnings fell 20%, but more importantly where Giant Interactive is going: a development based like Perfect World, or Operation based such as Shanda.

You can also find the post on Raw Plunger.