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Intellectual property rights fortify entertainment market in China

Ouyang Shijia
Updated: Mar 26,2018 8:58 AM     China Daily

A whole new business of intellectual property or IP rights related to digital games, online literature, films, TV dramas, animation and comics has emerged in China.

Mobile games based on other forms of IP products contributed 74.56 billion yuan ($11.8 billion) to economic output of China in 2017. They also accounted for more than 60 percent of the total mobile game revenues, according to a recent report.

The report, released by leading Chinese gaming industry database Gamma Data Corp, highlighted the emerging trend of spinoff from hot IP rights related to games. IP rights-protected products like digital games will play an increasingly significant role in supporting gaming revenues.

“From the perspective of users, driven by the love for great copyrighted cultural products, they will be willing to experience related derivative works, among which games will be suitable carriers,” said Wang Xu, chief analyst at Gamma Data Corp. “As China’s demographic dividend is disappearing, game developers need to seek new ways of expansion. And the IP rights-protected products will help reduce the cost for developers to attract users.”

According to the report, the pan-entertainment industry has become a key driver of economic growth in China. In 2017, it generated more than 480 billion yuan in economic output, up by over 15 percent year-on-year.

The report noted that gaming accounted for around 40 percent of the total pan-entertainment industry sales and reached 200 billion yuan in revenues last year. The gaming segment will gradually play a key role in the overall pan-entertainment market, it said.

Currently, China has 583 million gaming players, mostly those born in the 1990s and 2000s, a group dubbed as millennials. As of 2016, nearly 10 percent of mobile gaming players are teenagers born in the 2000s.

As the digital-savvy young generation attains growing purchasing power, their own culture, such as the animé, comics, gaming and online literature, is gaining momentum.

Chen Rui, chairman of Chinese popular video sharing platform Bilibili, said there is a clear difference between the younger generation and their parents in terms of the demand for culture and content.

“Increased material wealth, high-quality education environment and access to internet services are shaping today’s young generation’s diversified and personalized cultural needs,” Chen said.

According to Gamma Data, China had 220 million ACG fans by the end of 2016 and their passion was expected to create an ACG mobile gaming market worth 15.98 billion yuan by 2017-end, up 45 percent year-on-year.

Dong Minna, an analyst at Beijing-based internet consultancy Analysys, said currently the ACG segment’s development is in its infancy, and the market will kick into a higher gear after a few years.

“Those young groups have a high degree of loyalty to things they really love, like the ACG culture. Once they select specific ACG content and a service platform, they will be willing to pay for what they like, such as playing related video games.”

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