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Chapter 503, page 0493: [The Imminent March into Japan and South Korea]

Most of the games developed by Youke have failed when they tried to enter the Japanese and South Korean markets.

The game "Sanguosha" was a complete flop in Japan. It operated in South Korea for three years with lukewarm reception, and shut down when its distribution contract expired.

Future Era was a complete flop in South Korea. It also performed poorly in Japan, being disliked by players along with Dungeon Fighter Online (DNF).

Plants vs. Zombies, on the other hand, became a minor hit in the Japanese market.

The Japanese game market is very strange; take this year as an example—

Final Fantasy XI remains strong, Monster Hunter Online is a huge success, and Ragnarok Online maintains its popularity. These three are the most profitable MMORPGs; the rest are not considered mainstream.

Japanese traditional console games have been enhancing their online multiplayer functionality in recent years, which can be seen as a type of lightweight online game.

Social games, in particular, entered their golden age in Japan.

The term "social games" here specifically refers to "social mobile games for feature phones".

You read that right, it's a feature phone game, not a smartphone game!
The most popular way to play games in Japan at that time was for a group of otaku or overworked office workers to chat and draw cards in WAP games on feature phones.

Simply outrageous.

……

The exhibition organizers provided a small meeting room specifically for business negotiations.

The representative from Gamepot handed over his business card and said, "Hello Mr. Qin, I am Ken Tanaka, the business representative from Gamepot."

"Hello." Qin Hao, the representative of the tourism department, also handed over his business card.

Ken Tanaka said, "Our company has extensive experience in distributing MMO games. For example, we distributed the Korean game 'Granado Espada' to Japan, and it once topped the popularity charts for MMOs in Japan."

Qin Hao asked knowingly, "How is 'Granado Espada' doing in Japan right now?"

"It's running very well," Tanaka Ken said, blatantly lying.

Actually, it's been failing for a long time. Gamepot is also struggling and is looking for new games to replace it.

Qin Hao asked, "How are your company's servers?"

Ken Tanaka said, "Stable and reliable."

This is true; Gamepot's servers are indeed renowned for their stability and reliability. They have standardized procedures for routine maintenance, data backup, and disaster recovery, and their customer service and technical support systems are also very strong.

The downsides are limited financial and technological resources, insufficient server flexibility, and the risk of server crashes if the server is under-prompted when distributing a wildly popular game.

It primarily operates as a game distributor and has extensive experience in this field. Its business model is similar to Shanda's, but it lacks Shanda's financial resources.

Its situation is similar to that of Shanda.

The older games it distributes have declined, and its new games from the last two years have also performed poorly. Although revenue has been increasing, net profit has continued to decline due to project failures and soaring costs, and it is currently operating at a loss.

Qin Hao and Tanaka Ken talked for a long time, but they couldn't even reach a preliminary agreement on cooperation.

Because the prices quoted by the two parties were too different.

Gamepot, operating at a loss, simply couldn't afford to offer a high price. Even with a performance-based agreement, Ken Tanaka had no authority to make any commitments, stating that it needed to be reported to the company for discussion.

Subsequently, Qin Hao contacted the South Korean distributor, but the price offered by the South Korean side was also too low.

……

Chen Guiliang accompanied Blizzard Vice President Michael on a tour of the game exhibition area before returning to the lounge of his own exhibition area.

Qin Hao came over to report on the progress of the negotiations.

“Let’s continue the talks, but don’t agree to Gamepot’s offer for now,” Chen Guiliang said.

Chen Guiliang plans to enter the Japanese market, but operating online games in Japan requires obtaining various qualifications, unlike in Ireland where you can just start a company.

Therefore, the only option is to acquire an existing Japanese company.

Last year, he began gathering information on Japanese game operators through a consulting firm.

Gamepot was Chen Guiliang's top acquisition target because it perfectly suited his needs: it had extensive experience in operating large-scale online and web games, stable servers and teams, and mature game marketing channels. Moreover, it was operating at a loss!
The direct cause of the losses was the failure of all the new projects.

In the Japanese game market, even World of Warcraft suffered a major setback, and League of Legends repeatedly encountered obstacles, making it extremely difficult to act as an overseas game distributor.

Chen Guiliang wanted to buy Gamepot and then operate "Wulin Gaiden" and "Oracle Era" in Japan himself.

The risk was extremely high, and failure was quite possible, but he still wanted to give it a try.

If projects fail one after another, they rely on browser games to recoup their losses.

Gamepot also has a browser game business, mainly developing web versions of MMO games. This browser game model lacks any unique features; Chen Guiliang prepared reskinned browser game gacha packages for Japanese players.

If all else fails, just bring out the ship girls!
A cross-border call came from Tokyo: "Boss, I just spoke with GPI, the parent company of Gamepot. They say they're not selling, but I think they're trying to raise the price."

"What's their initial quote?" Chen Guiliang asked.

"$7000 million."

"Are they robbing us? A game distribution company that has been losing money for two consecutive years and has run out of funds dares to make such a high demand."

"But we definitely can't get the $3800 million you asked for. This company does have some game copyrights, and although we think those copyrights are useless, they think they have great commercial value. The main problem is that we can't agree on the game copyrights."

"Can we not buy those copyrights?"

"They insist on selling it all together as a package." "Let's continue negotiating."

Damn it, they have a bunch of copyrights to old games that are just sitting on my hard drive taking up space, but they insist on selling them as a package before they'll sell the company.

Chen Guiliang came out of the lounge and returned to the "My Own Swordsman" booth.

Countless players were queuing up to experience the game. Chen Guiliang picked up the microphone and shouted, "Isn't 'Wulin Gaiden' awesome?"

"Awesome!" the players answered in unison.

Chen Guiliang then asked, "After the public beta launches, will you spend money on in-game purchases?"

"charge!"

"No way!"

The majority of people shouted "No charging," completely drowning out the voices that said "charge," which immediately caused a burst of laughter from the audience.

Chen Guiliang said, "You can't play without paying; this game requires prepaid cards. I solemnly promise that since it's a prepaid game, we will never sell any paid items. There's a very bad trend in the domestic online game industry right now: people buy prepaid cards and sell items, treating players like fools! Do you want to be fools?"

"I don't want to!"

This time, the answers were louder and more resolute, and the responses were remarkably consistent.

Chen Guiliang said, "Youke's mission is to put the player experience at the center. If the players are happy and the company makes money, we are all happy. If the company makes money but the players are unhappy, we will never do such a thing!"

"Old Master Chen is awesome!"

"Support Youke!"

Shouts came and went.

Chen Guiliang laughed and said, "I'll make you willingly hand over your money!"

These words were quite blunt, but surprisingly, the players present didn't seem offended; instead, they burst into laughter.

There were also game media reporters invited by Youke at the scene. They had all received red envelopes, so naturally they would report on the interaction that just happened. And it would definitely be a positive report.

After making his appearance here, Chen Guiliang returned to the hotel to attend the afternoon e-sports sub-forum.

……

This year is clearly the lowest point for the esports industry.

A global downturn.

In the Chinese esports industry, this is reflected in the fact that not only have the owners of major clubs withdrawn their investments, but also in the absence of large-scale tournaments at this year's ChinaJoy expo.

The highest-level event was actually the G-League Shanghai Regional Finals, which was hosted by Gamefy Channel.

Other events were even lower-level, all just exhibition matches organized by some company. These included Dota exhibition matches on the HaoFang platform, Infi exhibition matches on PPTV, StarCraft 2 exhibition matches at the Blizzard booth, and so on.

Under Chen Guiliang's leadership, the bosses who entered the e-sports industry this year have not yet really made a big push.

Chen Guiliang stated in his speech at the esports sub-forum: "Since the economic crisis, the esports industry has been in a slump, and the situation has been deteriorating in recent years. This year is even worse than last year; the CJ exhibition couldn't even attract any major tournaments to participate..."

"Everyone here is a representative of Chinese game developers and esports clubs. This year's 'Oracle Era' National City Championship will hold its offline finals after the ChinaJoy expo. Anyone interested is welcome to come and watch; we're giving away free tickets..."

"I plan to create a national professional league for 'Oracle Era,' abbreviated as OPL. At the same time, I also plan to create a European professional league. The best teams from these two leagues will compete in a China-Europe showdown next year..."

"The champions and runners-up of this year's City Championship will automatically qualify for the OPL. The remaining slots will be awarded to professional esports clubs. Clubs wishing to participate in the OPL should form their Oracle Era teams and register as soon as possible..."

"The prize money is substantial, stay tuned!"

The esports club representatives present were all eager to try their luck, believing that Chen Guiliang would set a very high prize amount.

Putting aside the prize money, the current esports downturn and the establishment of professional leagues by large companies offer them another way out.

After the sub-venue activities ended, the representatives of the e-sports clubs all rushed over and surrounded Chen Guiliang.

Chen Guiliang said, "For specific details, please contact Youke's esports department. I won't go into details here. Once our professional esports events grow bigger, Youke will also establish a dedicated esports subsidiary to be responsible for esports events in China and around the world!"

After saying this, Chen Guiliang left.

Next, we need to accelerate the promotion of "Oracle Era" and not just focus on the Chinese and European leagues.

South Korea definitely needs to pay attention, as it has a highly developed e-sports market.

But should I find a Korean company to act as my agent, or should I open my own company in Korea to operate it?
Chen Guiliang plans to run it himself!
No matter how difficult it is to get started, you have to do it yourself.

Incidentally, League of Legends has not yet entered the Korean market.

Riot Games' delayed announcement of its expansion into the South Korean market, which was supposed to be announced this month, may be due to setbacks in the European market. It's highly likely that Riot is facing financial difficulties; they've wasted too much money in Europe, and Tencent has not continued to invest.

Currently, Youke is not only in talks about acquisitions in Japan, but also in South Korea.

Since building a company requires applying for various qualifications, it's better to acquire a Korean company directly. Chen Guiliang set his sights on Mgame, the developer of "Yulgang".

Mgame suffered huge losses last year and is now laying off employees like crazy.

If the acquisition of Mgame fails, then recruit employees laid off by Mgame, especially mid-to-senior level employees who were marginalized and laid off. Then, use this group to establish Youke's Korean branch.

The European market has been secured; the next step is to expand into Japan and South Korea.

(End of this chapter)