Analysis of Chinese game industry
《The Dilemma of Chinese Game Industry》
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A Research Paper
Abstract.
When the first trailer of Black Myth Wukong was released, it received a lot of attention from Chinese players. Based on this phenomenon, this article reviews the history of the Chinese gaming industry and analyzes why this game can receive such a large amount of attention and the problems that exist behind the Chinese gaming industry.
Written in 2020
The Dilemma of Chinese Game Industry
August 20, 2020 is just a normal day for many people. But on this day, a trailer for a game was quietly released. That day, this trailer became the focus of attention of players all over the world. In just 24 hours, this trailer has received over 10 million views on Chinese video site BiliBili alone.( Young,2020) It is no exaggeration to say that this is a day that can be recorded in the history of Chinese games. The name of the game that caused the uproar is Black Myth: Wukong.
Black Myth: Wukong showed the gameplay and graphics in the trailer and even made many celebrities in the industry feel refreshed. But for newly released games, showing unique gameplay and graphics has long been accustomed to everyone. But why does this game even amaze many practitioners? Because they knew that the production team of this game is not from large companies such as EA or Ubisoft, but an independent studio from China.
When it comes to Chinese games, many people should first think of those high-profit mobile games such as pubg mobile or arena of valor, rather than high-quality single player games like Black Myth: Wukong. In fact, if the Black Myth Wukong can be successfully released, this will be the first 3A-level single player game in Chinese history.
3a games are not a formal classification of games, but 3a games generally refer to those games with high investment, high quality and high sales.
Interestingly, China is not a country with an underdeveloped game industry. On the contrary, China has the largest gaming market in the world. Not only that, Chinese game publishers account for 26% of the global mobile game market revenue.(Mordorintelligence,2021) So the question is, as a country with such a developed market, why China never had a self-developed 3A game? What’s the reason cause this dilemma?
In order to understand how to improve the situation, we need to start with the history of Chinese game industry.
Back in the 1980s, foreign countries were in a period of rapid development of video games. For China, which had just reformed and opened up at that time, "video games" was still an unfamiliar word. At that time, people's memories of the game still remained in the video arcade near the school. After school, the children secretly came to the game hall without telling their parents and used the pocket money they had accumulated for a long time to play two matches. For them, this was the happiest time.
In 1987, with the appearance of Xiaobawang(a console), more and more people can enjoy games at home. This also allowed more and more people in that generation to learn about video games.(Yong,2008) Then, the Chinese game industry ushered in spring in the 90s, and more and more game studios boom out. Softstar Entertainment, seasun, object software, Heluo studio……They created the glory of that generation. They created games that Chinese players will remember. Some games have even gained recognition on the international stage. The prospects are bright.
But what people did not expect was that the blow to Chinese game industry followed one after another. It is also because of these reasons that China's single player games have declined step by step.
In 2000, the Ministry of Culture issued a ban on the sale of game consoles. Xbox, play station, Nintendo and other game consoles completely withdrew from the Chinese market. This ban was lifted after 14 years. (Greene,2016)China has missed the golden stage of developing the game console industry and has completely missed the game console culture. "Game console", a pivotal existence in the history of world video games, has become a blank in the history of Chinese video games. There is no Chinese console game, and there is no Chinese own game console.
At this time, China's PC single player games are still under development. But at that time Chinese game makers also faced many difficulties. Because at that time, the game was still based on CDs as the main selling mode. The distribution model of pressure plate sales has seriously increased the cost and the difficulty of scheduling. It's easy to happen that popular games are not stock at all, and games that no one wants to play are full of warehouses.
This situation has also happened in the United States. This is the famous Atari collapse in the history of the game.( El Paso times,2013) At that time, Atari miscalculated the quality and popularity of the game, and produced a large number of game cassettes. But in the end, it was unable to sell due to a large backlog of game cassettes, which indirectly led to the fall of Atari.
But compared to the problems encountered in the sales of games, piracy is the main culprit affecting Chinese games.
Electronic games are objectively a commodity. But video games are also digital products. As a digital product, it is bound to face cracking. This is not something that can be changed. It is determined by the attributes of the digital product itself. Once cracked, digital products can be copied in large quantities at a very low cost. These low-cost products will naturally be counterproductive when they enter the market. The market formed a strong shock. What followed was an industry of pirated games. A large number of pirated game CDs have flowed into the market, taking away a large amount of market share.
Object software that developed games such as " Metal Knight " and "Fate of the Dragon" have made games with a piracy rate of over 60%. The data from Softstar Entertainment is even more exaggerated. The sales volume of the original version of Chinese Paladin: Sword and Fairy 1 is only 800,000, while the number of pirated copies is as high as 20 million. The sales volume of the original version of Chinese Paladin: Sword and Fairy 2 is only 300,000, while the sales volume of pirated version is 10 million. These are very scary numbers.
What's more frightening is that these huge data only count the number of pirated CDs. It does not count the part that is transmitted directly through the network. No one knows how much damage this part has caused to these Chinese single player game industries.
The last straw that really overwhelms China's single player game industry is online games.
The beginning of the 21st century ushered in the Internet tide. In 2001, with the entry of "Stone Age" and "The Legend of Mir" into China, the market size of the online game industry reached 56 million dollars. Domestic game manufacturers have a new understanding of the ability of online games to make profit, which has triggered a chain reaction, and various studios have transformed and developed online games. (Yong,2008)
Some people may ask why other countries’ single player games have not been affected by pirated, online games and other content, but have developed their own single player game culture?
It is true that even other countries are also affected by these factors. However, in the world's mainstream game market, game consoles are the backbone of the industry, occupying the main part of profitability. The former console game sales model is still relied on selling CDs. Game consoles are not as easy to crack as PC games. If you want to play console games, you must insert a legal CD into the game console, players can play the game only if the console identify the CD. Many foreign manufacturers have survived the wave of online games that began in 2000 by relying on the console is hard to crack.
But China is not so lucky. Because of the ban on the sale of game consoles, the road of selling on game consoles was completely blocked. The game console ban affects not only the sales part of the content. Due to the lack of the game console market, the government has not issued relevant laws and regulations, such as a game rating system. Similarly, there are no laws and regulations to restrict this group of pirated game merchants.
If foreign games are pirated in China, at least these games can still make money locally. But if Chinese games are pirated by people in China, it is really a dead end.
These various reasons that have forced China's game industry to move to the road of purely online game. The era of online games has arrived.
Online games, like single player games, have many different types and ways of play. In China, the most popular game type for players is MMORPG (Massive Multiplayer Online Role-Playing Game). MMORPG games have created extremely high profit in China. From 2002 to 2004, MMORPG-type games increased the profit of the Chinese market from 149 million dollars to 517 million dollars. (Yong,2008)
Games make money, and all game manufacturers want to get a share. Starting from the wave of online gaming, more and more MMORPG games have appeared in the players' field of vision. The payment mode of the game has gradually changed from a timecard mode like World of Warcraft to the mode called microtransaction. The former is to spend money to buy game time, the latter is the game is free, but you need to spend money for the in-game items.
Among the microtransaction games at that time, one game had a great influence on the development of microtransaction online games in the future. The name of this game is Zhengtu. This is a game that uses price discrimination to the extreme. Simply put, it means that you can become stronger only by paying more and more money.
So far, a layer of free online games has appeared. Rich people pay a lot of money to buy items to bring profit to the game, while free players spend a lot of time to level up the character. Because every money you paid, it will bring some changes in the game experience. Every player has been squeezed out of the maximum payment limit he can accept.
As a game, the quality of Zhengtu is not really good. Compared with those famous single player games, the quality is even worse. However, the profitability of Zhengtu in a short period of time has far exceeded the profit of the single player game sales for several years. It tells everyone with cold facts: this mode is more profitable than making single player games. Seeing the benefits, more and more manufacturers have begun to use this model to make games. Gradually, this game mode has become the mainstream of Chinese games. Players are also imperceptibly affected by this mode. For many players who are accustomed to the microtransaction game, when they see those high-quality single player games, they will not be shocked by the exquisite graphics and interesting gameplay, but will ask the question: Why this game must pay to play? Ironically, the price of an item in a microtransaction game may be much more than the cost of buying a high-quality single player game.
In this way, players have entered the era of mobile games with this bias to games. In the era of mobile games, this differentiation is magnified even more severely. Many high quality games on the IOS platform that need to be paid are uninterested, but those microtransaction games make a lot of money.
Nowadays, mobile games have gradually replaced the former online games. Even more frightening is that in the era of mobile games, Chinese game makers have formed a negative closed loop. From the data point of view, several companies that dominate the mobile game market also owns the most widely used social media app in China. Take Tencent as an example. QQ and WeChat are the most widely used social media app in China. When the company want people play their game, they just need to put advertisement in the App and give people some welfare, usually people will play it. Just like many websites can log in with a Google account, these games also require you to log in with a social media account like WeChat account.
Because these companies have many users, although many people may not pay for the items in the game, they can still make a lot of money. As I said before, because they control social media, they can let people know about the games they make, and they can also make people ignorant of other good games made by other producers. Therefore, many Chinese players do not have the opportunity to know those fun and high-quality games, because not all of them are huge gamers. For most people, they will only play popular games. The information in these social media makes them think that the games made by these companies are good, and these games are their only choice. Many people do not see that there are many other options, which can only exist in this closed cognitive loop.
These game companies can still make a lot of profits from these low-quality games. So why do they need to invest a lot of money to improve the quality of the game? Even though many game producers want to create fun and high quality games, the bosses of these game companies don't think so. If there is no demand for high-quality games in the Chinese game market. Naturally, these companies will not invest a lot of money to develop 3A games or create 3A game studios. The demand for 3A games is exactly what the Chinese market lacks. Only demand from people can change these companies.
Take the most famous company Tencent as an example, they have huge capital and number of users. But what they did was the most disgusting. Whenever a game becomes popular, Tencent will immediately invest in the development of a very similar game and compete with it through a huge number of users. If Tencent finally failed after making it, Tencent will choose to acquire the manufacturer of that game. When the game is control by Tencent, the consumption mode will be changed to microtransaction games. People will still pay it.
From the data point of view, the profitability of Chinese games is rising every year, and mobile games occupy the largest share in the market. (Mordorintelligence,2021)Some people may ask, is this not a good sign for the Chinese game industry? Of course, if the game is just viewed as a product, it is indeed very good. However, the game is more than just a product for players. In the eyes of many people, games are also considered the ninth art. As a comprehensive carrier, games include music, design, stories, etc. A good game can even resonate with many people's emotions and even thought-provoking. For example, Hideo Kojima’s Death Stranding has conveyed to the world the importance of the link between people. A game called flower which made by Jenova Chen has even been collected in the Smithsonian American Art Museum.
Now, most Chinese games have lost the true essence of the game, and game makers are focusing on how to make more money from player instead of thinking about how to make the game have more fun.
From these perspectives, the Chinese game industry is deformed. Chinese games need to change. But how?
As ordinary people, it is impossible for us to fight against huge capital, but we can still do what we can. Buying genuine games is the best way for people to support game producers. Only when they earn money ,they have the ability and motivation to continue making the next excellent game. In contrast, people must resist pirated games. Only in this way will let the environment of the game industry get better and better. Even though the game has high quality, b if all the people are still buying pirated versions. Who are willing to make high-quality games? In addition, recommending high-quality games to friends around is also a good way. Because many situations it's not that people don't like to play high-quality games, but they don't even know that there is such a game exist. By recommending games to friends, more and more people will know about high-quality games. When people are able to distinguish what is a high-quality game, I believe the demand of game will also change. These take time. If this industry really wants to change in a short time, those game companies must make changes.
In fact, there are indeed game companies that have begun to change. A Chinese company called MiHoYo invest 200 million to making a game called genshin impact. Although it still hasn't gotten rid of the traditional Chinese game mode, it still made a lot of innovations(like use open world instead of chapter) The graphic and quality is really good. This game made about 4 billion in profit in the first month. When the result came out, other huge companies were shocked, and this made them start to improve the game quality. (Oloman,2020)Since the steam platform was launched in China, more and more Chinese game studios have been selling high-quality single player games on the platform. Single player games such as "Dyson Sphere Program " and "Gui Gu Ba Huang" have also achieved good sales. Even large companies such as Tencent have begun to try to make high quality single player games.
Only if someone in the industry is willing to break this closed loop, the entire industry will continue to progress and improve, otherwise, even if the number of profits is large, it will stay in place. Only these producers are willing to develop high-quality games. People will have the opportunity to play the high-quality games. If there is no high-quality new game in front of people, people cannot break the stereotype of the game.
For the normal player, just try one’s best to influence the environment around that person. If more and more people know the standard of high quality game, I’m sure at that time these game companies will improve their games quality. Because nobody wants to play the trash game. If a person really wants to change this situation, try to make interesting small game first. Then try to enter the industry. Don't forget the heart,making games is to bring people happiness. I believe when more and more people with the same thought enter the industry, the industry will eventually change. The situation will not change immediately, but it is still a seed of hope, it will take root eventually.
I hope one day people from other countries will have the opportunity to try high-quality games from China. I hope one day, Chinese game producers will be able to say to the players from the heart, like the super producer Halliday in "Ready Player One": Thank you for playing my game.
References
El Paso. (2013, January 22) The 1983 "Atari Titanic" is rising. https://www.elpasotimes.com/story/news/history/blogs/tales-from-the-morgue/2013/01/22/the-1983-atari-titanic-is rising/31517033/
Greene, M. (2016). Video Games, China. In Pop Culture in Asia and Oceania (pp. 343–346).
Mordorintelligence. (2021,Mar 12). Chinese Gaming Industry: Growth, Trends, and Forecasts (2020 - 2025). Chinese Gaming Industry | Growth, Trends, and Forecasts (2020 -2025). https://www.mordorintelligence.com/industry-reports/chinese-gaming-industry.
Oloman, J. (2020, October 5). Genshin impact: 17 million downloads on MOBILE ALONE, estimated $50 million in revenue since launch. https://www.ign.com/articles/genshin-impact-17-million-downloads-on-mobile-alone-estimated-50-million-in-revenue-since-launch.
Yong, C. & Downing, J. (2008). The realities of virtual play: video games and their industry in China. Media, Culture & Society, 30(4), 515–529. https://doi.org/10.1177/0163443708091180
Young, C. (2020, September 1). Black myth: Wukong-the world exclusive story behind the breakout action-rpg. IGN news. https://www.ign.com/articles/black-myth-wukong-making- of-behind-the-scenes-exclusive.