Kevin Chou, chief executive officer of Kabam, said he has changed the firm's strategy since setting up a studio in Beijing in 2010. (Photo/China Daily)
Kevin Chou is convinced the future of entertainment is gaming. As the CEO of Kabam Inc, a United States-based mobile gaming developer and publisher, Chou announced plans in April to launch the company's hit game in China.
Marvel Contest of Champions had been downloaded by more than 30 million users in the first three months since it was launched in December, 2014 in the US. "I think this game can make more money in China than in the US market," Chou said, without revealing the US figure.
Although he is not a major gaming fan, the Chinese-American entrepreneur does have an eye for a good business. That is why he set up the company with two other co-founders, Holly Liu and Michael Li, in 2006.
Already Kabam is the sixth fastest growing company in North America, according to the 2014 Technology Fast 500 list, compiled by Deloitte LLP, the global professional services firm. Last year, the company's revenue was $400 million.
And even though Kabam has yet to make money in China, Chou is confident of success, which is hardly surprising since the company is world leader in mobile games
To make sure Marvel Contest of Champions is a smash hit, Kabam has changed the game for the Chinese market, switching Western characters to local ones and setting up a pricing strategy. Another winning point, according to Chou, is the console-quality of the game.
But, of course, the test will come in the quality of the experience for mobile users. The fantasy action game is based on the iconic Marvel cartoon characters from the Hollywood franchise films such as Avengers, X-Men, and Guardians of The Galaxy.
"It works 60 frames per second－the standard of high-definition movies." Chou said. "So when fighters move, graphics are smooth. You can actually project this game onto TVs and it works quite well."
The games market is China is certainly big business. According to a report by Beijing-based Internet consultancy Analysys International, the mobile gaming market in the country more than doubled to 29.3 billion yuan ($4.7 billion) last year. It is expected to top 41.2 billion yuan ($6.6 billion) in 2015, an increase of 40.5 percent.
It is hardly surprising then that Chou and Kabam are eager to get a slice of that cake. "I think in every gaming market in the world, the graphics really matter," he said. "Just like how the movie industry in China, people want beautiful experiences. They want the highest quality games and we can give them this for free."
Kabam has changed its strategy since setting up a studio in Beijing in 2010. At first, the company, which is valued at $1 billion, decided to take Chinese games to the Western market. But Chou ditched that plan and shifted Kabam's focus to bringing Western games to China. He is now also planning to develop Chinese games for the market here.
The rewards could be huge as the country is on course to become the largest mobile gaming market in the world－bigger than the US and Europe put together.
"Firstly, there are about 700 million smartphones in China, out of a population of 1.35 billion," Chou said. "The number of people with smartphones in China is already the same as the entire population of the US and Europe combined. Still 600 million more people in China don't have smartphones, so the size of the market is big from a people standpoint.
"Besides, in the US and Europe, gamers have other choices. They play X-box, Play Station and PC games. But here in China, many people are experiencing games for the first time by playing on their smartphones and tablets," he added. "So it is their only choice for gaming."
As the only Chinese-American gaming company, Chou is confident of bridging the cultural divide, although the road ahead will be tough because of the different business environment.
The mobile gaming sector in China is also dominated by domestic players. Although several foreign competitors have entered the market, they have faced big challenges.
"The biggest one for foreign game developers is how to deepen their understanding of local markets and users," Xue Yongfeng, an analyst at Analysys International, said. "Without enough knowledge, they can't launch efficient marketing campaigns and often fail to roll out good localized products.
"There is a growing demand for console-quality games, especially among heavy Chinese players, who now contribute to a bulk of revenues for game companies," Xue added. "Mobile hardcore games, with console quality, are the future of the market. But its success depends on how well developers can adapt it to smartphones without sacrificing the user experience."
Zhang Xuecheng, 26, a graduate student who has been playing mobile games since 2005, is more interested in the quality of the game than the graphics.
"What matters most is whether the game is interesting," Zhang said. "It is OK for a well-designed game to have relatively poor graphics. But I would not be interested in a console-quality game if its characters and events are boring."
