By Rhee So-eui and Michael Wei
Reuters

SEOUL/BEIJING–Flush with cash from IPOs and a lucrative online game operating business, Chinese companies are trying to expand into game development, breaking free from their dependence on foreign titles and boosting incomes.

After long relying on foreign hit games such as U.S.-based Activision Blizzard’s “World of Warcraft” (WOW) and “Kartrider” from South Korea’s Nexon, China now wants to develop its own blockbusters and eventually lead the fast-growing market.

It may be a while before China overtakes South Korea, which dominates Asia’s online gaming market, but there are growing signs that Chinese firms such as Netease.com and Tencent are now in a strong position to compete globally and are catching up with rivals quickly.

Successful online games can generate earnings for years from monthly service fees, character customization and other micro-transactions and carry higher margins than classic console games. Developing games in-house also reduces uncertainties over license contracts and renewals.

“We consider in-house development a sound business model, which brings relatively high margins,” said Phyllis Sai, spokeswoman for Nasdaq-listed Chinese game firm The9.

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Fresh from its stint as a participant in the recently concluded 2009 Game Developers Conference in San Francisco last month, MoAnima is confident that the Philippines will emerge as one of the leading global outsource destination for the games industry.

This year, more than 17,000 game industry professionals took part in world’s largest industry-only event.

As a Filipino gaming outsource company, MoAnima represented the Philippines in a series of meetings with leading game developers, publishers and other luminaries in the field.

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MAKATI CITY, Philippines–After acquiring a majority stake in an animation and digital studio and a mobile content developer, Internet services provider Intellectual Property Ventures Group (IPVG) is now looking at game development.

IPVG Chief Executive Officer Jaime Enrique Gonzalez said that the company is supporting the creation of more original intellectual property for the local gaming industry.

“We’ll be advocating original content to help our game developers and this will be our main focus for the next two years,” Gonzalez said during a presentation at the Ayala Foundation’s regular Innovation Forum.

While IPVG, which also owns online game publishing firm IP E-Games, has been offering licensed online games, the company is willing to invest in game development, the executive said.

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