The Rise of the Chinese Game Development Industry

The Rise of the Chinese Game Development Industry

<o:p> </o:p>It is ironic as an American who has started a game studio here in Korea in a move that obviously I think is advantageous for me and my company - to now worry about the Chinese game industry competing with the Korean industry that I am now a part of.

<o:p> </o:p>The game industry is just one part of the world economy where we see China aggressively dominating so many markets from low-tech manufacturing, textiles, toys and recently high-tech manufacturing such as cell phones.  We are traditionally told that we do not have to worry about competition from overseas, as it will only serve to streamline our own economy to higher levels of efficiency – at least that is what corporate America is telling us Americans.

<o:p> </o:p>I read in the paper the other day that Korea is enjoying record export trade to China this year, but reading the article a little closer it was troubling me to learn that much of this trade is high-technology tools that will enable China to produce new products.

<o:p> </o:p>This is happening in the game industry too, as China demands our source code, joint ventures and other accommodations in order for us to sell our games in China.  Certainly it is their right to make whatever demands they want to protect and grow their market and nation.  It is however, up to us to decide to accept their demands or to walk away from selling games in China.

<o:p> </o:p>Unfortunately we work in a tough and challenging industry and it seems that it would be rare for a company to be in the position to walk away from a deal to service their online game in China for cash now even if it means that 2 or 5 years from now we will be competing with China not for the Chinese market, but competing with China in our own Korean market!

<o:p> </o:p>This is a very real possibility as the production values and costs for online games will continue to grow until we have 500 person teams creating gorgeous fantastic worlds.

<o:p> </o:p>I do not claim to have any answers to this question.  Indeed, I am giving serious thought to setting up a subsidiary studio in Shanghai to create some of the art for our games here.  This would have two benefits, of course it would provide for us a cost savings in Chinese artists, but more importantly it would allow us to get around the increasing barriers that the Chinese government is putting up on foreign online games.

<o:p> </o:p>So even as I describe the problem, I admit as a businessman I am considering an action that further weakens the Korean game industry.  Being an American in Korea this is a little abstract, but I have grown very fond of Korea and I am a little troubled as to what our future will look like.

<o:p> </o:p>To be fair to China, the last 300 years has seen China deeply exploited by the West during the age of coloniasm such as the Opium Wars, and the core reason why the Chinese labor rate is so cheap is that their economy is struggling to recover from these past three centuries of damage.

Perhaps I should just consider myself not an American nor a Korean, but just a citizen of Earth

-Erik <div

Originally posted on LiveJournal