During the morning session on the first day of the Social Games and Virtual Goods World conference, the talks were dominated by Western companies' failed efforts in breaking into the increasingly lucrative Chinese social games market.
Jouni Keranen, COO of Apple Toon - the self-styled China Disney - started his presentation into his company's efforts at making a dent in China with a downbeat message to those present - "In terms of success in the internet industry, only Blizzard's World of Warcraft has succeeded ... and they licensed that to a Chinese company".
Tough country
It's already successful, however. Backed by US VCs for its Series A round, the social games, toys, and animation company launched its portal in April, and is now gainsmore than 500,000 new users per week.
Keranen warned delegates of being 'blinded' by the potential audience size, saying that "a lot of companies think 'I'll just catch the one percent'. But China is a fragmented market ... a lot of services either get really big, or they fail totally.
"A company needs to be doing well in its core business before it goes into China ... if youre a small gaming company ... you dont need to go to China," he explained.
Have to go big
One way that Keranen suggested to overcome these issues was growing the game into other areas, highlighting Rovio as "one the first companies from a gaming perspective that understands the importance of brands" by expanding out into animation and toys.
The sticky subject of piracy is never too far away when it comes to speaking about the Chinese market, and Keranen was blunt in his opinion on the topic.
"China is a place of piracy and theres nothing you can do to change it."
However, he also believed that "piracy is helping a lot of the big brands" thanks to its habit of increasing the presence of a company's game or product in the social conscience.
"One of the goals [for Rovio] is to be one of the most pirated brands in China. You will see plenty of Angry Birds merchandise in market stalls. It's not generating money, but it is helping the brand to succeed," he said.
Copy cat
Unusually for a developer-led talk at a conference, Keranen's second piece of advice for Western companies was to actively become competitors to Apple Toons - by aiming games not at soccer mums but at the under-18s.
He called this demographic a 'blue ocean' of opportunity, stating that the pressures of the One Child policy on parents to see their children succeed meant that "the kids want a break" from long school hours and after-school activities in the form of social browser games they can quickly dip into.
Although, much the same as the mixed-messages being sent out to the world from China's social and economic policies, he finished the talk by describing the country as "a big opportunity if you have all the elements, despite the failure rate being almost 100 percent".
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Will's obsession with gaming started off with sketching Laser Squad levels on pads of paper, but recently grew into violently shouting "Tango Down!" at random strangers on the street. He now directs that positive energy into his writing (due in no small part to a binding court order).
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