China’s gaming market show signs of recovery in Q1 2019

The sector was stifled by regulation last year.

Photo by Sean Do on Unsplash

The Chinese game market generated RMB 58.44 billion (USD 8.51 billion) in the first quarter of 2019, up 8.8% from the previous quarter and 5.1% year-on-year, per IDC’s latest estimates.

Mobile gaming continues to generate the lion’s share of revenue, accounting for 64.6% of the industry’s windfall last quarter.

The number of Chinese gamers increased marginally, reaching 640 million people, a 1.7% uptick compared to the last three months of 2018, and up 6.7% year-on-year. User growth was driven by the rise of mobile games. Altogether, the number of mobile game users hit 620 million in the first quarter of 2019.

China is home to two of the world’s ten biggest gaming publishers, including global leader Tencent and seventh-placed NetEase. The country is the world’s largest gaming market, generating RMB 160.2 billion last year, according to Beijing-based data consultancy Analysys.

The country’s gaming sector slowed after China’s internet and media regulator halted approvals for gaming licenses amid a governmental reorganization in March last year. Consequently, China’s gaming market grew just 5.4% in the first half of 2018, the slowest in a decade.

IDC expects China’s gaming market to pick up again following favorable government policies, including resuming monetization applications for new video games and clearer rules for the game approval process.