Interview

Beware the clash of Tencent, Alibaba, Baidu and 360, warns Yodo1

Beware the clash of Tencent, Alibaba, Baidu and 360, warns Yodo1

It's already the fastest growing, most competitive, most fragmented and fastest changing mobile game market in the world.

But what will the year of the horse bring to the Chinese mobile game industry?

We've been asking some of the key players to give us their views on how the next 12 months will play out.

Henry Fong is CEO of Yodo1, a publisher which started out bringing western mobile games into China, but since has expanded to become a global publisher.

Pocket Gamer: What were the key trends in the Chinese mobile games market last year?

Henry Fong: I would characterize 2013 as the gold rush era of China mobile gaming. The bulk of the year was dominated by massive market where high tides lifted all boat; smartphone unit shipments broke 500 million and mobile gaming revenue broke RMB 10 billion ($1.6 billion).

With hundreds of app stores already fragmenting this crowded market, we saw many new players nose dive into mobile gaming ranging from listed companies snapping up game studios to get into the mobile gaming play as well as many of the internet giants such as Alibaba and Youku announcing their entrée into the mobile gaming market.

big players will only get bigger, squeezing out their small/medium sized competitors even as the market continues to grow

An increasing trend towards the end of 2013 is that the big players will only get bigger, squeezing out their small/medium sized competitors even as the market continues to grow at a near triple digit percentage.

Do you think app distribution will improve significantly in 2014?

I think app distribution will become more centralized in 2014 and instead of hundreds of players fragmenting the market, it will likely be several dozen companies that will dominate app distribution. It will become much harder for start-ups and new market entrants to gain traction and good execution alone will only allow companies to sustain market share.

Even as market growth is expected to double again in 2014, I expect it that it’ll be a small number of players commanding a much bigger slice of market share.

What do you think will be the impact of WeChat?

Like Kakao in Korea and LINE in Japan, WeChat is a major force driving the growth of social mobile gaming. In the short span of under 12 months, it’s turned around Tencent’s fortunes in mobile gaming and propelled them into the top spot in terms of game distribution.

I believe that 'War is Coming' in 2014 however and the titans of the internet are set for a show-down with Alibaba joining the fray along with Baidu, 360 and other billion dollar companies all vying for mobile gaming supremacy.

Are you worried that the market will become even competitive as more western games are released in China?

I’m actually a big believer that healthy competition helps to sustain and grow a market. The rise of the China mobile gaming market has actually been good for Yodo1 as more quality publishers and game studios are now prioritizing China earlier in their lifecycles.

This has driven a major increase in pipeline in terms of partners reaching out to us to help them succeed in this ultra-competitive market. It will be up to us to continue to innovate, execute and differentiate in order to remain relevant in the market.

How important do you think international markets will be for you?

Mobile gaming is fast becoming a global market and we need to be a global player in order to remain relevant. That’s why Yodo1 began our investment in global publishing back in mid-2013, starting with the opening of our Korean office and the publishing of our first global titles such as OMG: TD! and Cavemania.

We plan to invest significantly in our global efforts this year with key Asian markets such as Korea and Japan being an anchor, as well as expanding our distribution reach in English speaking western markets simultaneously.

What's your biggest hope for 2014?

I hope to see innovation continue to drive change and growth in the market. As with all maturing market, innovation becomes harder to come by.

My biggest hope is that Yodo1 can sustain our start-up mentality, continue to innovate and hopefully cause some fresh disruptions in the mobile gaming market!


Contributing Editor

A Pocket Gamer co-founder, Jon is Contributing Editor at PG.biz which means he acts like a slightly confused uncle who's forgotten where he's left his glasses. As well as letters and cameras, he likes imaginary numbers and legumes.

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