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Market Potential

Growth opportunities for gaming companies with an inside track in the Chinese speaking regions speak for themselves.

China is a market of over 1.2 billion people and over 7% annual GDP growth. This, together with recent admission to the World Trade Organization and hosting of the 2008 Olympic Games indicate strong growth for the foreseeable future.

China’s buoyant economic performance is reflected in the growth in Internet usage paving the way for excellent prospects in the gaming industry.

China: The Largest Internet Market within Four Years
China is on track to become the world's largest Internet market within the next four years. The world's most populous nation is now second behind the United States in terms of people online.

The Internet Society of China expects surfers to hit 78 Million (December 8, 2003)
According to a report on the development of the Internet in China given by Hu Qiheng, chairwoman of the Internet Society of China, at the Second Internet Conference of China. The number of Internet surfers in China is expected to reach 78 million by the end of December, with 500,000 websites and 30 million online computers in China also expected.

According to SINA.com, by 2006, China will make up 53.1% of Asia's Internet Users, 51.2% Internet buyers, and 48.6% of ecommerce.

The Online Gaming Industry
The strong growth in Internet usage will be reflected in online gaming. According to Datamonitor the market value of the online gaming industry in 2001 was $32 million and is expected to rise to $79 million in 2006. This reflects a compound growth of 10.6%.

According to Christiansen Capital Advisors only 14% of e-gaming websites are in Chinese while the market potential represents over 19% (including Taiwan) of the total global market potential.

The Majority of Chinese Professionals use the Internet for Business
A survey by Fortune China showed that 61 percent of Chinese businesses have Web sites, and that the majority of Chinese professionals -- 60 percent -- use the Web for business.

Wireless is set to become a powerful marketing channel. ZDNet (December 16 2002) reports that there are now over 200 million mobile phone users in China, up from 167 million in April 2002.

China/Asia demonstrates its propensity to play games online
According to a recent IDC survey of more than 3,600 Net users across six Asian countries. In China and Malaysia, there are twice as many online gamers as there are Internet shoppers. Around 43 percent of Chinese Internet users play games online, while just 16 percent report that they shop via the Net.

The strong growth in game play is also reflected in wireless gaming according to two recent surveys

Strong wireless gaming growth is predicted in Asia, as Strategy Analytics estimates that downloadable games will be the fastest growing consumer application during 2003 generating $2 billion by the end of the year.

Similarly, Datamonitor found that the Asia-Pacific region hosts 70 million mobile gamers, with wireless gaming revenues totaling $1.1 billion. The subscription model, followed by pay-per-play, is currently the most popular revenue model. Together they account for $920 million worth of wireless gaming revenues in Asia Pacific.

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