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PC browser games going away? Not in China, apparently

Some say PC browser games are destined to be superseded by mobile games. But Aaron Hsu, head of Taiwanese game company XPEC, says Chinese market trends suggest otherwise.
There are some people who believe that the PC browser game market is finished. Browser success stories like Jagex's Runescape aren't exactly common, and while Facebook's game revenues are up, companies like Zynga and EA are withdrawing browser games to focus on mobile. But Aaron Hsu, president of Taiwanese game company XPEC thinks the browser market is ripe for a comeback - specifically in mainland China. "I'm not sure about the rest of the world, but the browser game market in mainland China is just booming," he told us. "It's just like the MMORPG market in 2003, for China. I feel like the Chinese developers have created a new business model for browser games, there." But where's the proof? Hsu brought out a sheet of paper from a government agency that tracks sales of game products, and read me some figures. "In 2012 the total market scale of browser games alone was 7.5 billion RMB (1.2 billion USD), which is 30 percent growth over 2011," he said. "In 2011, growth for the browser game market in mainland China was 46 percent. And in 2012 it was 36 percent." So the growth rate has slowed - is that not a sign of market contraction? "Growth rate is a little slower," he admits, "but compare that to the client-based MMORPG, client-based games MMOG in mainland China, where the growth rate was only 13 percent in 2012," he countered. And these games are apparently making money. "The number one browser title in mainland China, they have 5,755 group servers to host all these player," he says. "The per month total revenue is 65 million RMB (10.5 million USD). For the second ranking game, the total number of servers is 2,499, and monthly revenue is 60 million RMB (9.6 million USD)." "Because of this success, China has a lot of browser game developers jumping into the market. So I don't think that mobile will kill the browser game market," he says. "To the contrary, so far, the mobile market in China is not there compared to worldwide performance."

The Western opportunity

When prompted, Hsu doesn't seem concerned about over-saturation in the browser market yet, as more developers jump in. He sees a big potential market for Western developers to move their products into the region. "You have to look to future markets," he says. "You need this perspective of the online game market. You cannot skip the mainland Chinese market. According to mainland China's performance, I do believe browser games in Asia still have a whole lot of potential." What should Western devs do to move into China then? "I'd suggest that they find a reliable publisher," he says, "or find a reliable business partner, or co-developer, to work together in getting to the China market. I would never suggest going to the China market by yourself. Even Activision, even Blizzard, any big publisher in the Western market, when they're going to China, they just play the developer's role. They have to find a good partner in Mainland China. And if not China, you can try Taiwan!"

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