Online games and small game industry alternative winter method

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Although since the beginning of the U.S. subprime mortgage crisis, this year has spread to the global financial crisis, is how to arouse the unease of the domestic internet, even "Ali father" Ma Yun first thrown "winter theory", Baidu Tencent and other big guys also followed chimed. But in this winter sound, we can always hear the Chinese online games industry bosses of the "Spring" theory, Shi Yuzhu said that the internet "winter" on the industry, because "the essence of the online game more tend to the traditional entertainment, life cycle is generally longer", Jinshan seeking Baijun analysis as " Online games as a cheap entertainment, will not be affected by the global financial crisis, and Charles Zhang based on the success of his online business is confidently said "not only did not winter, but spring" Hao Yan.

Admittedly, the game industry in our country does have the characteristics of the Internet industry and even the foreign game industry: compared to the internet, online games are more like entertainment and cheaper, while the inherent business model of domestic games market is very beneficial to cash flow; The mainstream of the foreign game industry or stand-alone version of the video game and play host, while the domestic game industry is simply "the whole of the net" ... Therefore, the online games industry should not be affected by the financial crisis too much impact, became a consensus. However, the so-called "in good time", in fact, we online games industry more need to seriously treat the internet in winter, is really so "spring", is the online game is really this winter "stove" it?

Venture capital affects the development of online games

Sequoia Capital, a famous venture capitalist, recently told the CEO of the holding company, who invested in its "winter emergency meeting", to save money and cautioned that "if the company's cash flow doesn't make ends meet, then don't come back for us." In fact, the attitude of Sequoia, representing the venture capitalists, commercial banks, investment funds, private equity and many other investment institutions, and these investors, but also is our Chinese online gaming companies when the main investors. The changing attitude of investors means that small and medium-sized game companies, which desperately need angel investment or financing, will soon have a hopeless investment. Need angel investment of those game studios, although the investment demand is not big, but the development of a relatively complete online games at least need tens of millions of yuan level, without this first step of the angel investment, or even can not complete a game development. Midsize gaming companies that need further financing the game's cash flow only enough to support the lack of development, these medium-sized companies would have to face the crackdown of large companies, the only hope is to endure a new product can soar, and no financing can not go to develop or agent the next game, also lost the opportunity, In the long run it is very easy to cause a crash. Therefore, the change of attitude of venture capitalists, directly kill the small game studio and the game company, will have the potential to cause the successors of our online games industry, product single, giant monopoly and other unfavorable situation.

The financial crisis has also led to a strategic shift in big companies

Jinshan Beg Baijun said, although the financial crisis is very serious, but Jinshan will not change the previous investment development plan, the other game giants are mostly with the Baijun hold the same view, Grand Chen Tianqiao even promised not to reduce strategic investment, not layoffs, not pay wages, Another point of view is that the financial crisis can be beneficial to the net swims big company's investment acquisition behavior expansion. However, the financial crisis caused all the domestic listed online game giant stock plummeted, this is the fact, based on the company's own values of the consensus, but also almost all the online game giants began to buy back their own stocks, repurchase stock behavior although it is also show the confidence of the industry, but also need to use cash. The fact that the cash in reserve is reduced is in conflict with the idea of not reducing strategic investment or even increasing strategic investment, in which any firm can only be cautious and cautious in its investment strategy in the face of shrinking stocks. And the shareholders of these online games giants, some even big shareholders, many of the commercial banks and large funds that have been battered by the financial crisis have argued that they should be the same as Sequoia, requiring money-saving or even cash-strapped, and no reason to support big investment acquisitions. Therefore, the domestic online game giants will be in this crisis, the company's investment development strategy to change, the appropriate change will make the company a good future, and the change in the wrong will be in this emerging industry in the fall. In fact, even if we agree that the financial crisis has spawned mergers and acquisitions, there will also be a risk of monopoly after mergers.

On the question of cheap online games

Although online gaming is a very inexpensive form of entertainment, the gaming industry has always been a "safe haven" for economic crises, even in Europe and the United States, but it is actually not cheap to play games. In the European and American markets, the price of video game consoles and stand-alone games is much higher than 10 years ago, Forbes magazine also said that Europe and the United States game industry is no longer a haven for investors. In China, too, many online games are not cheap, such as "journey" on the creation of a game in the precedent of the rich, some of the super player's consumption is already over million, since the journey, a lot of online games began with this "RMB online" way to produce, want to find five or six years ago 30 yuan can play one months of the game, Basically no more! On the other hand, on the internet, there are more inexpensive forms of entertainment than games: chatting, dating, online movies ... As a result, the "cheap" trademark of online games has long been taken away by other entertainment on the internet, but there is a tendency to label "high-priced Entertainment". In fact, the giant Shi Yuzhu has realized this problem, continuously launched the "Journey fee version" and "Journey of nostalgia version" to reduce the consumption value of individual users, with the expansion of the total number of users and cultivate more paid users to maintain growth, this "national route" is to deal with the financial crisis must be taken to "online game price reduction" measures. However, not all companies like giants think, after all, it is necessary to abandon a model of making a lot of money, and the game system is not said to change can be changed, bad change will cause the whole game crash. What can be expected is that after a round of economic turmoil, "high price" online games gradually exit, the real cheap online games in large numbers, in the course of the replacement of the game will also have the game company's rank ups and downs.

Option hopelessness leads to higher employee payroll costs

The share price of all gaming companies is down, and one side effect is that employees ' options become waste paper, as in the case of giant networks: The giant network that landed in the NYSE for nearly a year has been falling since April, according to the Convention, Only if the company's share price is higher than 15.5 U.S. dollars, the executive hands of the options have the right meaning, to the giant network October 14 closing price of 6.33 U.S. dollars, the company nearly 1/5 of the options have become waste paper. This situation pervades all the Chinese gaming industry's listed companies, wherever they are listed, and even the entire Chinese internet listed companies. Options lose meaning, meaning that the game companies need to come up with something else to motivate employees, the Division of Operational Development, salary floating, and even the allocation of shares measures, will be expected. Plus, if the economic crisis worsened the price inflation, the cost of staff compensation will be our new industry has not met the astronomical, the game industry's creativity and technical decisions of the importance of game talent, if not solve this pay cost crisis will also result in the online games industry reshuffle.

In fact, compared to other industries, and even compared to other industries of the Internet, online games really show a "spring" scene, I also believe that so many of the giants of the big words is not false but feel. But "in danger" nothing bad, all the development is the opportunity also has the risk, should fully understand this financial crisis, and not blindly optimistic even violate the market law, then really will become this winter's "stove"!