Biz Daily: How China's economic woes will impact mobile games

hello and welcome to is daily i'm jang chon so today we're going to take a bit of a broad a brush approach to the nova games industry and actually look a world economy Roman see kind of what we can draw a conclusion we can draw from that so the big news at moment is is the Chinese what's going on the Chinese economy so around stock exchanges over the last kind of weak being heavily down basic as people are unsure happening in China the Chinese economy of all know has been kind of like the growth of the powerhouse of far more economy anyway um the last ten years really China has revolutionized itself is compliments and agrarian society people being farmers basically and it's gone to becoming a big production facility basically everything earlier most things significant Qing electronics mobile phones made in China so there's been a big transformation big a kind of

increase in the middle classes in China and China has gone from a developing country into a developed country a one that is a monthly with over a billion people home has a lot of power markets a second biggest economy in the world by most standards and what we've seen in China over the last some really in 2015 person in his last couple of months is kind of a lack of confidence so Polly that's a Chinese growth has for last 10 years really been simple sentir in this economy and that's kind of something that's it's actually really needed to just fuel its growth to make sure always people have jobs home and to kind of grow its middle class make sure what kind of 2 degree of anh's happy um and and it's been surprisingly it's been growing at seven percent a quarter for the last 10 years and that degree the assortment of suspicion has been raised because there were no subs edits them is the number it needs there is always hit seven percent so it's been a kind of growing suspicion whether that number is actually a good a good lower well kind

of a balanced backup number and increasingly that's convene scene there's been a few kind of bubbles in China there's been a property bubble and then the stock exchange there's a show nice lookin changing the change in chakra stages big ones in China hong kong stock exchange and they've been they've grown mother lost kind of year-on-year up a hundred percent over the last kind of three months down fifty percent so a lot of volatility in there obviously the boot problem in China is lot of people have been borrowing money to us to buy shares because they thought shares with me up and I'm up and to degree the Communist Party kind of early courage this behavior obviously now when you knew your full for those down fifty percent and you have to pay back the money you now don't have people getting a little bit upset and so what we're seeing on twenty stock exchanges is the Chinese government kind of being very active and telling people not just sell shares who have shows telling people who previously like pension funds it couldn't buy shares now buy shares and in a sense of what's doing is actually making people more nervous about the

kind of underlying kind of the health of the stock exchange in China and then you have contagion and now the stock exchanges around the world of something a bit worried about what's going on in China so so much for the world economy of things going things not very good if young chairs what does that mean for mobile game companies obvious a moment we're going become its own exchanges so they've been hit that she has have gone down like pretty much every other kind of company who had shares we can kind of draw some analogies so the chinese mobile games market has been growing amazingly really over the last couple years so a hundred percent growth at last two years probably fifty percent growth in 2015 you know very big numbers much bigger than anywhere else in the world and so what we've kind of seen is some companies particular western companies have been looking to china as the place where they will find a lot of growth and even over the last kind of 2014 we saw um japanese companies like DNA in gree current set up offices in china and take advantage of that growth

early on and didn't really work out but this company's ended up really with bloody noses and had to shut down their operations don't we found this China I mean really surprised China is a very different market to the rest of also really the world to the mobile games balls down to the three big kind of market so there's there's Japan which is a all these about five billion dollar market he does vandal sales so Japan is a very Japanese market very half the people break into that market on Japanese there's the west north america and europe a bit more open but still most of the big games there are from Western companies and then this China again a kind of 45 billion dollar kind of market size annually and it's always potentially a bit more open to some game person well done very well they're kind of clash of clans and candy crush saga then come to degree this you usual suspects but some kind of companies I think kind of thought that just that just the growth of the Chinese market would make it easier for them to maybe get growth easily easier than China all over all the Western markets mucho sorry

not growing anything like fifty percent maybe that's growing attempts in a 15-percent year so kind of China was seen as this kind of good opportunity and maybe what we'll see now is the Chinese market or actually mature quite quickly so another interesting thing that came out has come obviously is that Chinese shipments of smartphones in China actually dropped door declined palam quote on quote for the first time so we kind of seemed very quickly until of handset and distribution that Marquis declining is maturing at least will say and that could have knock-on effect for certain company so an interesting Monica banter Kabam are Hagel in the States but mostly development is in China is she was a big push into China for them into degree they've been successful their mobile game has been pretty successful Marvel conquest of Champions has been successful globally but China's be a good part of that I'm an equally uh even over the rovio so a third of the angry boat to kind of a downloads have been in China so it still kind of a place where people can find growth who

can find audiences but i wonder if kind of in in future months and certainly over the next year people stop talking so much about the kind of growth opportunities with china it's not talking much more specifically about the nitty-gritty of how you kind of find success in china because i think it's very easy when when when you see massive growth all the time to sink is very easy to capture some my growth and it's not that's only when Marcus become mature you have to spend much more or marketing we much more sophisticated in your messaging much more careful about the games were putting out and how you kind of them localize them and chemical tries them and so I think we'll see him much quicker than we perhaps thought a torrent of the chinese mobile games market and equally that will affect yourself in the chinese mobile companies who'd agree have me up to raise quite a lot of money on on their kind of activity because they were seen it in a growth market and now they'll probably find it a bit hard left it probably show some some some good figures and it will probably see a lot of consolidation that market to degree it's already been happening but i think

we'll see a lot more of that and potentially will see a lot more to come chinese companies Rufus sancti again Jones coming to raise money going out spending and acquiring Western companies