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CITIC Securities said that the National Press and Publication Administration drafted the "Measures for the Administration of Online Games (Draft for Solicitation of Comments)" and solicited opinions from the public, adding some new provisions, which are stricter and more extensive than the previous regulations, and the market reacted strongly to this. We believe that the goal of the draft management measures is to ensure and promote the prosperity and healthy development of the industry, and it is recommended to pay attention to its final implementation and rationally look at its impact. On the same day, 40 imported game editions were subsequently released, and the current distribution of edition numbers is still at a normal pace, while the regulator emphasizes the encouragement of high-quality original games and games to go overseas.
The game industry is an innovation-oriented industry, and through technological innovations such as AI and VR, as well as business model innovation in gameplay and categories, there are still development opportunities for China's game industry in the medium and long term, especially for companies that focus on high-quality content and overseas development.
With the popularization of mobile Internet and the promotion of 5G technology, the scale of online game users continues to expand, and the market scale continues to grow. Especially in the field of mobile games, the number of users and game revenue continue to grow, becoming the main growth driver of the market. In addition, China's booming esports industry has attracted a lot of investment and attention, bringing new business opportunities to the gaming industry. However, with the tightening of regulatory policies and the stricter censorship of gaming content, the industry also faces some challenges.
-- Game market sales revenue
With the continuous advancement of social modernization and electronicization, on the basis of the increasing satisfaction of the material level, people's demand for spiritual entertainment is constantly improving, and online games have become one of the main ways of leisure and entertainment for contemporary people based on their storytelling, social and communication characteristics, and the market scale of online games is expanding.
In 2021, the sales revenue of the mainland game market was 296.513 billion yuan, an increase of 17.826 billion yuan from 2020, a year-on-year increase of 6.4%. In 2021, as the epidemic eases and the impact of the stay-at-home economy weakens, the growth rate of sales revenue in the mainland game market will decline.
- Sales revenue from the mobile game market
With the rapid development of mobile Internet and intelligent mobile terminal devices in the mainland, the scale of the mainland game market continues to grow, among which the rapid development of mobile games far exceeds that of terminal games and web games, since 2016, mobile games have overtaken terminal games, and the mainland game market has gradually established a development trend dominated by the development of mobile games.
In 2021, the sales revenue of China's mobile game market accounted for 76.06% of the total market revenue; The revenue of the client game market accounted for 19.83%; The revenue of the web game market accounted for 2.03%.
Specifically, China's mobile game market has maintained a rapid growth trend in recent years. In 2021, the actual sales revenue of China's mobile game market was 225.538 billion yuan, an increase of 15.862 billion yuan from 2020, a year-on-year increase of 7.57%, and a decrease from the growth rate in 2020. The main reason for the decline in growth rate is that there are fewer new products launched in the mobile game market in 2021, mainly relying on the increase in turnover of old products, and the consumption power driven by products in the past is gradually weakening.
-- Sales revenue from the client game market
In recent years, with the rapid development of the mobile game market in mainland China, the development of both mobile games and web games has been greatly impacted. In 2021, the sales revenue of China's client game market was 58.8 billion yuan, a year-on-year increase of 5.15%, and the first growth in nearly three years. The main reason for the increase is the excellent performance of new client products launched in 2021, which has brought back user Xi.
-- Sales revenue from the web game market
In recent years, the size of the web game market has continued to shrink due to the continuous decrease in the number of web game servers and the squeeze of the client game and mobile game market. In 2021, China's web game revenue will be 6.030 billion yuan, a year-on-year decrease of 20.74%, declining for five consecutive years.
From the perspective of the proportion of self-developed games in the total game market revenue, the market share of China's self-developed games continues to increase, and by 2021, the proportion of China's self-developed games in the domestic market has increased to 86.28%.
Yuan Weijia, a senior analyst at Shenwan Hongyuan Internet Media, said that the new regulations on online games are an important complement to the "Interim Measures for the Administration of Online Games", which was repealed in 2019. Compared with the old and new management measures, the new regulations focus on access approval and ex-ante supervision compared with the previous game regulation, supplement the detailed rules on R&D, operation, and monetization, and strengthen the linkage of supervision during and after the event, with the aim of optimizing the supply of games, improving quality, and improving the efficiency of approval and supervision, and many adjustments in the new regulations have been reflected in actual regulatory practice since 2019. Overall, the new regulations are a necessary part of promoting the normalization of supervision and the healthy prosperity of the game industry.
CICC believes that the draft is intended to make up for the lack of management measures (the Interim Measures were previously abolished in 2019) and aims to promote the prosperity and healthy development of the industry. We judge that the Draft Opinion will not substantially change the business model of the game industry after absorbing the opinions of all parties, and recommend paying attention to the industrial value of the high-quality development of "technology + culture" in the game industry.
Note: This article is for content purposes only and does not constitute any investment advice.
Prospective Economist APP Information Group
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