Asian Power: Why China, Japan and Korea Matter in the World of Gaming

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Even with some problems on the Chinese stock exchange recently, the Asian market remains the fastest growing in the worlds and offers a lot of potential for trade. PC and video game trading with Asian region still remains highly unexplored for western traders. Many wholesalers and distributors concentrate on western markets since they have the knowledge and experience in these markets, plus the regulatory environment is more advanced and supportive to business than in Asian countries. This makes is easier to trade in the familiar markets rather than try to explore and find new markets, and yet since the western markets are very competitive and are mostly saturated by huge number of players, the profit margins are usually pushed down, and it is increasingly difficult to make decent profits.

Asian markets on the other hand, although more challenging than the western markets, may offer high rewards to those business, which try to expand their trade beyond traditional and well known markets of Europe and America and trade on Asian markets , especially in China, Japan, and South Korea.

Profits and Products

A 2015 report by NewZoo indicates that China has the highest revenue from gaming in the world totaling to $22.23 billion, with the USA coming a close second at $21.96 billion.

A specific thing about the Chinese market, however, is that it has its own ecosystem of games. Take for example the results from a study conducted by SuperDataResearch. The second and third most profitable games on PC are Crossfire and Dungeon Fighter Online – titles that are little known in the West but have each managed to make more than a billion dollars in revenue. The number one title, League of Legends, is a big hit in China, and this explains why the game has managed to bring in a whopping $1.6 billion in global profits for 2015.

Then there is Japan and South Korea. The previously mentioned study by NewZoo shows that Japan and South Korea are the number three and four markets when it comes to gaming revenues –with $12.3 billion and $4 billion revenues respectively.

Unlike china, many Japanese and the South Korean game makers, develop games not only for local consumption but they also reach out to the West with their games.

Japan is a veteran when it comes to video gaming, with Nintendo being responsible for the revival and modernization of gaming in America back in the 90’s. In addition to Nintendo, many modern publishers, are based, or have started in Japan, including, Konami, Bandai Namco, Koei Tecmo, Sega, Square Enix, and others. And let’s not forget that Sony is a Japanese company too!

South Korea, has been developing high-quality MMORPGs for the longest time now. Blade and Soul is the most recent high-profile port to make it to Europe and North America, with other notable entries like Tera and Maple Story coming from the country.

Hurdles and Obstacles

Culture, politics and spending power are three very big hurdles when it comes to penetrating the gaming markets of these Asian countries.

While American and European players will be willing to spend more on their games, Chinese gamers on a whole don’t spend as much. Profits are derived from the sheer number of players paying a little over time than players paying a large amount up front.

Culture and politics in all three countries make it difficult to bring games to these countries as well. The majority of gamers in Japan and South Korea seek very different things in their games, from differences in aesthetic choices to the concept of combat itself.

China, on the other hand, won’t accept games that run counter to the norms imposed by its government. Gaming publishers won’t even be able to sell established franchises in the country without going through a Chinese publisher to serve as the middleman.

The Asian markets matter in the world of gaming, from boosting profits to bringing new games to the market. Doing business in these countries, however, requires a bit more thought and planning than setting up shop in American and European markets.