Online gaming in China is already a big industry. Gamers in China can use the internet to access a huge range of games, creating a large and diverse marketplace. Games often generate revenue through in-game purchases – where players can buy additional content, such as weapons, levels, or costumes for their characters, in order to enrich their experience.

With a growing population of people with disposable income and the world’s largest internet population, China can be a very lucrative place for online gaming. We take a look at the market.

The growth of online gaming in China

Online gaming has had a free reign in China for the past few years. In 2000 the Chinese government banned games consoles, citing fears over the affect they have on the mental health of young people. With the 14-year ban only being lifted at the beginning of 2014, people wanting to game have had to turn to other outlets, with consoles now having to try and lay claim to the market. However, the price of consoles such as the Xbox One and Playstation 4 equate to nearly a month’s wages for the average gamer in China (between $400-$500), with new games costing around a week’s wages (source: Reuters). By comparison, many online games are free, making them a much more popular choice.

Current Market State

Online gaming in China has a penetration rate of 59.5% among total internet users and 33% of mobile users. While many of the top games are free, in-game purchasing is a lucrative source of revenue, with 66% of gamers in China spending money on gaming each month. Action RPG (Role Playing Games) and FPS (First Person Shooter) games are the most popular, with 28.1% and 18.8% share of the market respectively. Nearly half of all gamers play games between 6pm and 10pm, with three-quarters playing at home, and nearly one fifth playing in internet cafes. 73% of gamers are male, with 23% female, and the biggest age group for gamers is 19-25, accounting for over half of the market. 60% of gamers prefer to play games with 3D graphics (source: CNNIC).

Future Predictions for Chinese online gaming

At the end of 2013 the online gaming market was worth $13.5billion (82.1billion Yuan). This is expected to grow to 131billion Yuan by the end of 2015, with mobile gaming accounting for 33.8billion of the total revenue (source: Statista). Experts predict that rapidly growing number of smartphone users in the country will mean that mobile will continue to increase its share of the Chinese online gaming market. By 2018 it is expected that the gap in revenue share between online gaming and other gaming will close, with online gaming accounting for nearly half of all gaming spend in the country (source: PWC).

It is estimated that in 2015 there will be 266million Chinese online gamers, spending at least 2 hours per month gaming (source: CNNIC).

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