Developers scoring big in mobile gaming

Visitors test mobile games at the China International Digital Content Exposition in Beijing. China's online game industry, valued at 11.24 billion yuan ($1.86 billion), is scrambling to devise products that appeal to players. CHINA DAILY

To sense how investors view the promise of mobile gaming, one needs look no further than Hong Kong-based Something Big Technology Co Ltd.

With just one hit product - SanGuo Mobile, which drew more than 3 million active players in the past three years - under its belt, the company has become an acquisition target.

Hong Kong-based Computech Holdings Ltd has proposed buying 5 percent of its shares, with a string of other capital injections to be announced in May, said Computech CEO Mei Liang.

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China's 11.24 billion yuan ($1.86 billion) online game industry is scrambling to devise games that appeal to a generation of players who spend more time on mobile devices than consoles or computers.

"Mobile gaming is still in second place for now, but that will surely change eventually as smartphones proliferate and people get more comfortable with in-app purchases," Mei said.

Most Chinese participants in the industry are considered successful with just one hit game. Now they're vying for more capital, optimizing their product portfolios and forming partnerships with foreign vendors.

As the market has grown, mergers and acquisitions have boomed, with at least 10 buyout deals announced or completed in the third quarter of 2013 alone. Almost all of China's top 20 unlisted mobile game developers are becoming acquisition targets.

For example, Internet giant Baidu Inc announced the takeover of 91 Wireless, a subsidiary of NetDragon Websoft Inc, the biggest ever deal in the industry.

Others opt for initial public offerings. Game developer and distributor Forgame Holding Ltd and Boyaa Interactive International Ltd went to Hong Kong to list in the second half of 2013, betting on investors' confidence in the booming sector.

Several Chinese mobile game companies, including Linekong Entertainment Technology Co and Chukong Technologies Inc, are targeting IPOs in 2014.

Even leading traditional client-based gaming enterprises are shifting toward the mobile end.

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