The video games industry generates several billion dollars of revenue each year in Asia Pacific alone. Now, the development of online game play has the potential to drive even more dramatic expansion in the media and entertainment market.

Video game companies are developing an everwider range of products that reach beyond the traditional teenage and twenty-something demographic. Video games are also integrating with mobile and social networking technologies.

China has emerged as one of the key markets in Asia Pacific and is increasingly playing a role in content development. It has recently seen some notable listings of software and video games companies on international and domestic stock markets.

We believe this report comes at a timely moment in the evolution of the video games industry. The jury is still out as far as evaluating the success of some of the business models and their ability to secure the revenue streams that will sustain the industry’s future growth.

As such, video games and social networking have become extensions of, as opposed to replacements for, real-world activities.

I would like to thank the Telecoms Research Project team in Hong Kong and Singapore for their involvement in this latest report and we welcome the opportunity to discuss the issues it raises with you.

David Collins
Partner in charge,
Information, Communications & Entertainment
KPMG in China and Hong Kong SAR

Download The video games market in China: Moving online

PDF format, 1.24MB, 32Pages.

Contents
2 Introduction from David Collins
3 Introduction from John Ure and Peter Lovelock
4 Video games move online
6 From product to service
9 The Asia Pacific market and implications for China
17 Investment issues
21 The valuation of online video games companies
24 Revenue assurance in the world of online gaming
27 About KPMG
28 Contact us

About KPMG

KPMG is a global network of professional firms providing audit, tax, and advisory services, with an industry focus. With more than 123,000 people worldwide, the aim of KPMG member firms is to turn knowledge into value for the benefit of clients, people, and the capital markets.

KPMG in China and Hong Kong SAR

In 1992, KPMG became the first international accounting firm to be granted a joint venture licence in China, and its Hong Kong operations have been established for over 60 years.

This early commitment to the China market, together with an unwavering focus on quality, has been the foundation for accumulated industry experience, and is reflected in the firm’s appointment by some of China’s most prestigious companies.

Today, KPMG in China and Hong Kong SAR has more than 7,000 professionals working in 11 offices. These offices are located in Beijing, Shenyang, Qingdao, Shanghai, Chengdu, Hangzhou, Fuzhou, Guangzhou, Shenzhen, Hong Kong and Macau.

As organisations in China join the global economy and international companies seek to enter the domestic market, KPMG’s blend of international experience and local knowledge ensures the firm is well-positioned to serve clients in an increasingly complex, but exciting market.

Information, Communications & Entertainment

KPMG professionals operate in multidisciplinary groups, focusing on clients’ needs and their industries. We place particular emphasis on consolidating industry knowledge and delivering services through dedicated teams operating through lines of business.

Our Information, Communications & Entertainment (ICE) group operates globally and across Asia Pacific, and has worked with many of the region’s largest electronics, telecoms, software and media companies.

Industry knowledge and training are shared among member firms, enabling them to assist clients in recognising opportunities and implementing changes necessitated by industry developments.

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