Regeneration pattern of online games change: Shanda revenue for the first time less than a smooth swim

Has released the fourth-quarter earnings comparison of online games stocks (unit: 100 million US dollars) Sina Technology Meng Hong Something seems to be only a matter of time. The grand game (Nasdaq: GAME) released this morning in the fourth quarter of last year showed that the online game company's current revenue of 172 million US dollars, less than Changyou (CYOU) over the same period of 173.5 million US dollars. This means that for the first time in China's online games market, Shanda's "status quo" has been surpassed to fourth place. Four years out of the top three online games business is grand at the beginning of this century relies on the world famous, Chen Tianqiao was 31 years old to become the richest man in China the root cause; is also a grand diversification can explore the cash flow basis. Looking back over the past four years, Shanda Games started as a publicly traded company with $ 1 billion in financing, but the IPO was a pinnacle. In fact, from the second quarter of 2009, the grand game business has begun to lose the boss's throne. Season, Tencent with "Dungeon and Warriors", "Cross FireWire" and other products, access to 12.41 billion yuan of online games revenue. The grand game business quarter revenue is 1.178 billion yuan. This is also the time when Tencent started playing the King's game. A year later, a similar scene was staged again. In the second quarter of 2010, Shanda Games revenue was 1.131 billion yuan. With the "World of Warcraft" and other products led, Netease game business received 1.2 billion in revenue. Shanda Games again with NetEase's "contest" at a disadvantage, retreated to the third position in the industry. The general trend of the industry stable After nearly two years, the top three rankings as mentioned in the opening paragraph mentioned changes. It seems that 2012 Changyou has been waiting to surpass the grand game of the day. In fact, the second quarter of last year, net profit margin in this financial indicators, for the first time over Shanda Games, however, until after two quarters of revenue beyond the reach. NetEase game business has reported earnings of 317 million U.S. dollars in the fourth quarter of last year, swims at 173.3 million U.S. dollars, Shanda Games at 172 million U.S. dollars and air network game business at 28.01 million U.S. dollars. However, from the annual game revenue, Shanda Games 745 million US dollars is still higher than the tour of 623.4 million US dollars. By the end of August last year, Shanda Games Chairman and CEO Tan Qunzhao left. Chen Tianqiao took over as chairman and Zhang Xiangdong took over as CEO - the third CEO of Shanda Games. Can we reverse the trend in 2013 and test a new team? Regaining the big game is not easy later than Changyou released the fourth quarter earnings, it seems that no longer attached to the figures. Some people inside the grand previously Sina technology and communication, the above changes will not be seen very seriously. In fact, Shanda Games revenue in the fourth quarter of last year, less than the fourth quarter of 2009 received 195.7 million US dollars. To know the same in 2009, Changyou fourth quarter revenue of 70.7 million US dollars. Why four years, the grand game almost stagnant, has been Tencent, Netease, more than swim? Of course the product is the key factor. In the grand game a large number of product layout, there has been no emergence of new "legend" as expected. A former executive at Shanda said to SINA Technology that the product is the biggest problem for Shanda Games: on the one hand, there are few genuine masterpieces in agency games; on the other hand, there is no real improvement in independent R & D capabilities. Shanda Games Some products have high hopes, but often for a variety of reasons did not become a pillar, especially last year, some games also did not come on schedule. According to the plan "space-time rift" will be open beta in March, and "zero world", "Final Fantasy 14", "Light City" is still under preparation. Failure to effectively build the platform is another factor. Peer in the online games, Tencent games, Netease games, Changyou have their own platform for the corresponding support, to continue to introduce new games to the game user. Relatively speaking, Shanda Games due to the grand group structure and other reasons have not been able to establish such a support, the growth system has always been lacking. In addition, as the "cash cow" business grand game has been under pressure. In the process of building the ideal nation of Chen Tianqiao, Shanda Games has always been the most important source of cash for Shanda. A self-hematopoietic system is not perfect, but is responsible for a huge blood transfusion task, which makes the grand game some faltering in the progress. Privatization into ideological trend Earlier this morning, Shanda Games shares closed at 3.01 U.S. dollars, with a market capitalization of 843 million U.S. dollars. The peer market, Tencent overall market value of about 630 billion US dollars (nearly half of revenue from online games), Netease the overall market capitalization of 67.79 billion US dollars (85% of revenue from online games), market cap 1.571 billion US dollars, the giant market value of 1.418 billion US dollars, perfect Market value of 487 million US dollars. However, these six companies account for about 80% of China's online game market, most of them in the capital market, especially for the five listed in the United States generally lower valuation. As of this morning, Grand Games P / E of 4.36 times, 4.97 times the perfect world, 5.99 times the swim, 7.83 times the giant, Netease is 12 times. Over the years, online games companies have been complaining about this, but the situation rarely changed. Due to the special nature of the game, while there is usually sustained cash flow, too much uncertainty leads to a loss of capital. Valuation is too low, the stock price downturn, so that privatization gradually become the trend of online games business. The privatization of delisting has several advantages. First, it can reactivate the incentive mechanism. The current share price has made many online game companies' options less attractive. Second, they can re-elect the market with higher valuation to refinance such as A-shares. Once again, they can get rid of public companies Cyclical pressure. Prior to Shanda has been delisted way privatization, Shanda games have always been considered. However, one of the fetters is that the current share price of Shanda Games (only 24% of the issue price) is beneficial to privatization from the capital expenditure but is very likely to incur investor litigation and other related disputes. Grand game is not alone in this regard. According to insiders in the industry, companies that hold similar ideas include online games companies like Perfect and Giant, but who can really put them into practice now is hard to answer.