$38b gaming market lures Kiwi developers

Chris Wilson, founder of Grinding Gear Games - the makers of Path of Exile, at his office in Henderson. Photo / Dean Purcell

The global video games market is forecast to break the US$100-billion ($138b) mark this year, driven by a huge appetite for online and mobile content from mainland China's more than half-a-billion gamers.

Mainland China is predicted to surpass the United States and become the biggest in the world for gaming at $38b according to a new report from research firm Newzoo.

James Everett of the New Zealand Game Developers Association said China was seen as a "key growth area" for NZ studios, but it was a market that came with challenges.

"China's players represent a massive market, and they are keen to play high quality games like those made by Kiwi developers," Everett said.

"While there are business and translation challenges, especially for startup studios, it's an opportunity every game developer is evaluating. So far, we've had several NZ-made hit games in English-speaking markets like the US. China, and the rest of Asia, is the next growth market for us," he said.

Peter Curry, developer and programmer at Dinosaur Polo Club said "most developers our scale have recognised China as the current growth market, and many are developing with Chinese audiences in mind".

Curry said when they launched their game Mini Metro on the App Store last year they found that China was their single biggest market after the US.

Curry said one of the challenges Dinosaur Polo Club faced in China was getting its game on a major digital store front for desktop players.

"Around 8 or 9 per cent of our [desktop] revenue comes from China," he said. "Steam [the popular digital store front] is available in China but it doesn't have the market dominance there like it does elsewhere."

Mario Wynands, managing director of Wellington-based Mobile game developer PikPok, said China was an important market for the company and usually features in the top 3 countries in terms of revenue and/or downloads.

PikPok currently distributes on iOS in China but was looking to expand onto Android by the end of the year.

"There are some challenges around this with regard to new content licensing laws and requirements around with local partners, but we feel we are making progress and that it will ultimately be worth the investment," Wynands said.

New Zealand's biggest gaming export Grinding Gear Games' Path of Exile boasts about a million active players a month.

Lead developer Chris Wilson said Grinding Gear Games, which employs 100 staff in New Zealand, was working on a Chinese version of the game that would launch later this year.

"It's going to be big," Wilson said.

The studio has partnered with a large Chinese publisher who can help protect the game from intellectual property issues in mainland China.

Due to grey areas in international copyright law mainland China poses intellectual property issues for developers where clones of successful games, including Blizzard's Overwatch, and Hearthstone are prevalent.

Recent partnerships between developers and publishers in China have helped to curb the knock-off games and intellectual property issues.

Shenzhen-based internet giant Tencent Holdings, the world's largest games company by revenue, was credited by the Newzoo report for opening the door for popular Western games on the mainland, which ensures that "the success of Western intellectual property in China will lead to new truly global franchises".

- Additional reporting from the South China Morning Post