Credit: Visual China

BEIJING，December 19 (TMTPOST) – China’s game market has rebounded in 2023,with sales revenue surpassing the 300 billion yuan mark for the first time, according to a report titled the 2023 China Game Industry Report.

The report was released during the recent 2023 China Game Industry Annual Conference by  Zhang Yijun, the First Vice Chairman of China Audio-video and Digital Publishing Association and Director of the Game Committee.

In 2023, the sales revenue of the domestic game market reached 302.964 billion yuan, a year-on-year increase of 13.95%. The user base reached 668 million people, a year-on-year increase of 0.61%, setting a new high. The sales revenue of domestically developed games in the China market was 256.375 billion yuan, a year-on-year increase of 15.29%.

The high revenue figure is mainly due to  a recovery in consumers’ willingness and ability to spend, the release of more new games, including blockbuster hits, along with long-term operational products. The widespread adoption of multi-platform concurrent release methods has also contributed to revenue growth.

As Overseas Revenue Declines, Mini-games Drive Growth

In contrast with the gradual recovery of the domestic game market, factors such as international turmoil, intense market competition, and changes in privacy policies have increased the difficulty and cost of going overseas.

The 2023 China Game Industry Report shows that self-developed products achieved overseas sales revenue of U.S.$16.366 billion, with revenue exceeding 100 billion yuan for four consecutive years. However, the data shows a year-on-year decline of 5.65%.

In 2023, the United States and Japan remain the main overseas markets for China's mobile games, accounting for 32.51% and 18.87% respectively. South Korea is in third place, at 8.18%. Additionally, Germany, the United Kingdom, and Canada account for a combined 9.45%. Emerging overseas markets such as the Middle East and Latin America have not seen significant improvements.

In the top 100 self-developed mobile games by overseas revenue, strategy games account for 40.31%, role-playing games account for 15.97%; shooting and casual games account for 10.03% and 5.11% respectively. Strategy games have been the main force in overseas revenue for the past three years, with the combined revenue share of the threeincreasing from 63.87% last year to 66.31% this year; the share of shooting games has declined; the share of casual games has seen a significant increase.

In 2023, domestic mini-games have achieved substantial growth. In 2023, the domestic mini-games market revenue reached 20 billion yuan, a year-on-year increase of 300%. At present, the monetization models of mini-games mainly include in-app purchases, advertising monetization, and a mix of both. Currently, due to the rapid increase in the proportion of in-app purchases, the market size of mini-games has grown rapidly.

Mini-games, with their advantages of more precise distribution, higher user conversion rates, lower development costs, and wide applicability to different scenarios, are gradually becoming a new growth driver in the industry.

In the view of Zhang Yijun, the first vice-chairman of the China Audio-video and Digital Publishing Association and the director of the Game Committee, "Sheep A Sheep" emerged out of nowhere in 2022 and became a phenomenal hit; "Xun Dao Da Qian" and "King of Salted Fish" released in 2023 also became extremely popular, all of which indicate that the mini-games  have endless potentials. However, although mini-games have a broad prospect, its scale is still small.

Meanwhile, mobile games continue to be the frontrunner,  accounting for 74.88% of total game revenue. Computergames' sales revenue has continued to rise, accounting for 21.88%; web games continue to shrink, accounting for only 1.57%.

In 2023, China's mobile game market achieved sales revenue of 226.86 billion yuan, a year-on-year increase of 17.51%, setting a new record.

In 2023, among the top 100 mobile games by revenue, role-playing games were significantly higher than other types, accounting for 31% of total revenues. Strategy and card games accounted for 9% respectively; shooting and card & board games accounted for 7% each.

In terms of revenue, role-playing games ranked first with a share of 29.55% of the total revenue; multiplayer online tactical competitive games followed, accounting for 17.01%; shooting games ranked third, accounting for 14.7%, with the three combined accounting for 61.26% of the total revenue. In addition, the revenues of shooting, strategy, and card games have all declined compared to last year.

In 2023, the domestic computer game market  had sales revenue of 66.283 billion yuan, a year-on-year increase of 8%, mainly due to stable revenue from massively multiplayer online role-playing games (MMORPGs), continuous growth in revenue from top esports and ACGN games, and the simultaneous release of more new products on the PC platform.

The online game market's sales revenue decreased by 10.04% year-on-year to 4.75 billion yuan, marking the eighth consecutive year of decline.

In 2023, the sales revenue of China's console games reached 2.893 billion yuan, a year-on-year increase of 22.93%.

In 2023, the sales revenue of China's esports games reached 132.945 billion yuan, a year-on-year increase of 12.85%. It needs to be specifically noted that this data represents the sales of esports game products and does not include esports live streaming, club operations, and event revenues. The actual revenue data of the esports industry, adjusted for statistical scope, will be officially released at the esports industry annual conference next week.

The growth in revenue from esports game products is mainly due to the stability of the leading esports games; the emergence of new esports game categories and the launch of self-developed new products, which have won the favor of players and brought significant growth to the market; additionally, the successful hosting of the esports events at the Hangzhou Asian Games and the outstanding performance of the Chinese team may have had a certain positive effect.

Although the industry has shown signs of recovery, it is also important to recognize that the difficulties faced by China's game industry loom. The sharp decline in demographic dividends, rising operating costs, high player expectations, changes in payment habits, homogenization of products, as well as international instability and changes in market regulations, are all restricting the expansion of Chinese game companies.

Game Technologies Benefit Other Industries 

The continuous pursuit of gaming experience by players drives the constant development of game technology, which, in the process, matures and becomes independent, also becoming an important hard technology force driving the integration of digital and reality.

Based on the essential attributes of super digital scenes, games are widely linked to other industries, unleashing powerful digital productivity and serving the transformation and upgrading of thousands of industries.

During the conference, the China Audio-video and Digital Publishing Association and the Industrial Culture Development Center of the Ministry of Industry and Information Technology jointly released the report titled "Super Digital Scene Prime Mover—Game Technology and Innovative Application Research."

The report points out that super digital scenes, along with the development of digital technology, have led to a new understanding of the essential attributes of games. Through more open scene connections, game technology is releasing tremendous digital productivity in an increasingly broad range of social production fields, creating increasingly greater social value.

The report shows that in 2022, the contribution rate of game technologies to the infrastructure of the digital and reality integration era, such as chips, AI, cloud computing, and mobile phones, reached 18.65%, 31.37%, 51.08%, and 46.76%, respectively. The contribution rates to cutting-edge industries of the era, such as XR, autonomous driving, telemedicine, and industrial design services, were 72.45%, 57.19%, 17.47%, and 29.47%, respectively.

In the aerospace field, game technologies also play an important role. In June 2023, a new generation of visual scene system, jointly developed based on Tencent's self-developed game engine technology and Southern Airlines' self-developed virtual image display technology, was released, making China the third country in the world capable of independently developing a complete visual scene system.

When releasing the report, Ao Ran, the Executive Vice Chairman and Secretary-General of the China Audio-video and Digital Publishing Association, believed that with the continuous breakthroughs in key technologies such as artificial intelligence, the game industry, as an important part of the digital economy, has been re-recognized in its essential attributes in recent years, and the value of the game industry has been re-evaluated.

The notion of gaming as a super digital scenario seems to have become a global consensus, with many countries successively introducing related industry support policies.

In addition, the "Chinese Game Influence" research results released by Ao Ran also show that games are becoming a "super digital scenario" that continuously creates new values and possibilities. With more immersive, intelligent, and interactive forms, traditional culture is continuously revitalized, becoming a new advantageous path for the world to understand the Chinese culture from all aspects and multiple angles.

Research data shows that 91.6% of respondents believe that Chinese games play an important role in "going global" for China's excellent traditional culture; 90.2% of respondents believe that Chinese games are increasingly becoming the "new container" for China's excellent traditional culture.

Beyond the super digital scenario, "Game+" is also a focus of attention for developers. Zhang  believed that more and more practical results show that there is a natural "resonance" effect between the game industry and technological innovation. The practice of "Game+" itself means innovation and implies infinite possibilities.

However, "Game+" is still in the early stages of exploration, and the specific path for "vertical breakthrough" is still under construction. It especially requires bold exploration, proactive attempts, and medium to long-term planning and positioning to carve out an innovative path that fits China's reality.

(This article was first published on TMTPost App, author | Li Chengcheng, editor | Ma Jinnan