CGTN Europe interviewed Santosh Rao, Manhattan Venture Partners Head of Research
Category
🗞
NewsTranscript
00:00Welcome back to Global Business Era.
00:02New figures show the increasing popularity of Chinese-made video games in foreign markets.
00:08Revenue from sales to countries including the United States jumped by more than 4% in the first half of this year.
00:15However, domestic demand dipped, with overall revenue falling by more than 3%.
00:20Well, Santosh Rao is head of research at Manhattan Venture Partners and joins us now.
00:24Good to see you again, Santosh. Welcome back to the program.
00:26Thank you.
00:27So, a bit of a mixed story, really. Revenue in China from games made worldwide went up. Why was that?
00:36Yeah. Thanks for having me.
00:39Well, there's a dichotomy there.
00:42You know, the games, their sales in China may be slightly down, but games outside China are doing very well.
00:50And the macro variables have a lot to do with that as well.
00:54So, you have to look at China slowing down, consumer spending slowing down, the GDP kind of on the lighter side.
01:01I think all those things are playing into that.
01:03But when I look at the numbers, the first half numbers in China itself, I think that they're tracking very well.
01:10I think this is seasonally a down low quarter.
01:13Most of the sales happen towards the end of the year, I think.
01:16So, you will see it pick up.
01:17So, if you just extrapolate the first half numbers to the full year, I think you're pretty much trending in line with what it would be like last year as well.
01:25And last year was a banner year.
01:27After 2022, when it slowed down.
01:30So, it's like going up and down, just reflecting the macro environment.
01:35You have the regulatory crackdown a little bit, 22.
01:38Then 23, it relaxed.
01:39It went up.
01:4024, it's starting slow, but it's still trending pretty well.
01:43So, overall, I think it's doing well.
01:45But the answer to your broad question is that the international markets are doing much, much better because there are less regulatory requirements.
01:56And it's popular outside.
02:00Well, that's what I wanted to ask you.
02:02Why are they popular?
02:03What is it about Chinese games that sell so well overseas?
02:07Well, the games are very good.
02:10I mean, they will do well in China as well.
02:13But there's a secular change going on in the sense that the app games are doing much better.
02:21The social media companies, social media sites are much better.
02:24They're attracting a lot of attention.
02:26The eSports, which is big in China, they're attracting all that at the cost of consoles and other more expensive games.
02:34So, I think that shift you're seeing, and people have less time, they want to spend less.
02:39So, I think those are easily available.
02:41The mini games, as they say.
02:43So, I think that's very popular.
02:45So, the games overall are very popular.
02:48I think Asian countries are the biggest consumers of gaming.
02:52And China is one of the leaders in that.
02:54A little up and down is fine and reflecting the macro trends as well.
02:59But China, I feel net-net overall the trending is in line with prior years.
03:06And what about AI, artificial intelligence?
03:09We're seeing that change many things, of course.
03:11How do you think it will change the gaming industry?
03:14I think it will help, absolutely.
03:16AI will help the gaming industry, including the VR and the virtual reality and all the other stuff as well.
03:23So, all those technologies are going to converge.
03:26So, AI is going to be big in terms of discovery and doing more things with the gaming.
03:32More applications are going to come because of AI.
03:34So, all those things are going to have a net positive effect on the gaming industry.
03:38And you're seeing that everywhere.
03:39And AI is cutting across all sectors and everywhere.
03:42It's going to boost productivity and just the variety of products that can be offered.
03:48So, you're going to see that in gaming as well.
03:50And gaming has always been the biggest beneficiary of technology, of AI all along.
03:55Because that's easy to do, easy to apply, and you're seeing the benefits.
04:00And we've seen that for the last one or two years.
04:02Santosh, good to talk to you as always.
04:04Thank you for joining us.
04:05Santosh Radha from Manhattan Venture Partners.