IHS Markit Report: Tencent and NetEase Non-China Mobile Games Revenue Increased 500 Percent in 2018
In its latest complimentary mobile games market report, “Mobile Games 2018: Disruption, Battle Royale and Hyper Casual,” business information provider IHS Markit (Nasdaq: INFO) explores the performance of the mobile games industry in 2018. According to the report, which is based on a recent analysis of appScatter Group title data, combined mobile games net revenue outside of China for Tencent and NetEase increased 500 percent in 2018 to $472 million.
A halt in new games releases from March through to December in mainland China tested Tencent and NetEase, alongside other Chinese games publishers. The freeze on new releases came as the state bodies responsible for providing new games licenses were reorganized. New policies were introduced, especially those focused on the use of games by children. “The unpredictability of the domestic market has underlined the importance of geographical diversification, so this dramatic increase in international revenues will be well received by both companies,” said Piers Harding-Rolls, games research and analysis director, IHS Markit.
NetEase has been more successful than Tencent in building its international revenue, according to IHS Markit. The company has two battle-royale titles – “Knives Out” and “Rules of Survival” – that are aimed at different international markets. “Rules of Survival” has gained popularity in Southeast Asia, due to its lower entry barrier in terms of end-user device specifications. In contrast, NetEase derives 80 percent of its $324 million Apple App Store and Google Play storefront revenue for “Knives Out” from Japan’s sophisticated and mature mobile games market.
“Knives Out” second only to “Fortnite”
In the battle-royale genre on Apple App Store and Google Play, net revenue from “Knives Out” was second only to “Fortnite” from Epic Games. On the Apple App Store alone “Fortnite” realized a net revenue of $390 million in 2018. Epic Games released the title directly to end users on Android, thus avoiding the 30 percent payment to Google normally associated with Google Play storefront distribution. Both titles are in limited direct competition, with the international audience for “Knives Out” largely in Japan, and with 74 percent of Fortnite’s revenue coming from the United States.
For more detailed information about the mobile games market in 2018, download the complimentary report from IHS Markit here: https://ihsmarkit.com/Info/mobile-games-2018-disruption-battle-royale-hyper-casual.html?utm_campaign=PC11436&utm_medium=email&utm_source=PRmedia.
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