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What does the mobile and PC gaming landscape look like in Taiwan and what is Garena's role and positioning?
Hello and thank you for your question regarding the mobile and PC gaming landscape in Taiwan, along with Garena's role and positioning. The most useful sources I found to answer your question are this report on Taiwan mobile gaming, and this write up on the benefits of the Taiwanese gaming market.
The short version is that Garena is a well known brand name within Taiwan, especially in relation to professional gaming within League of Legends. There are opportunities to branch into the growing mobile gamers market, which is largely dominated by RPG style games at the moment, as hardware becomes more sophisticated.
Below you will find a deep dive of my findings.
MARKET IN TAIWAN
The video game industry is a strong, mature market in Taiwan, experiencing 26% growth in 2015 alone. The industry was valued at NT$29.4 billion in 2015. The market is supported by a fast, easily-accessible internet infrastructure throughout Taiwan.
The largest portion of the market belongs to Sony. Companies like Blizzard however have targeted Taiwan as a location for testing games and response from customers. They have also recently set up a large data centre with an investment of around NT$100 million in order to better understand local gamers. Taiwan's shared language of Mandarin make it a prime target for Western companies to test their game reception, as well as mainland China testing to open to Western markets.
Twitch, a popular streaming service used by gamers to gain live audiences, had a recorded 23 million hits. About one-fifth—or 4.5 million people--in Taiwan use the service every month. The two most popular games for viewing and streaming include League of Legends, and second Hearthstone.
The opportunity as well as challenges here lie with the fact that Taiwan is a large consumer, not producer or developer of games. Gaming hardware like Asus and Acer however have made their mark on internationally-recognized brands from Taiwan. There have been efforts by the government to encourage growth and funds towards internet-based startups, as well as successful Taiwanese crowdfunding campaigns for gaming.
MOBILE GAMING
In 2014 a reported 7.8 million gamers played on their mobile phones. That is an estimated 81.7% of all gamers within Taiwan.
A huge explosion of growth was found in 2015 when the revenue of mobile gaming jumped up by 226 %, according to Taiwan's Market Intelligence and Consulting Institute. The market overall was set to hit $474 million by the end of 2015.
As far as gamer base and flexibility with types of games played, Android will collect the most players. However in terms of revenue, Apple games are the star "with 3X the ARPU". MMORPGs are expected to grow in popularity as mobile phones become more sophisticated. Cute animated games along with wuxia style games are also popular on this platform.
Taiwan is #2 for casual gaming on mobile platforms. The top games are from the Line based platform according to AppsAsia. The report also notes that mobile gaming habits of Taiwan are similar to Korea.
PC GAMING
The PC market has faced some slowing growth recently. The hardware market is challenged by lower prices from hardware exported by China. In 2014, a reported 9.3 million gamers played on their personal computers. That is an estimated 96.3% of all gamers within Taiwan. Interestingly, gamers in Taiwan and other countries have begun learning and broadcasting in English so that they may cultivate a wider fan base.
GAMING CAFES
There is limited information about the expanse and popularity in stats regarding gaming cafes. They are certainly popular enough to be frequented often, but reports on their status are linked to various deaths that have occurred inside of them from excessive gaming sessions. The only note I found was that there had been a downward trend of operating cafes; 2015 there marked 135,000 from the high mark of 350,000 shops across the country a decade before within China. If they have similar trends, we can assume the number of internet cafes within Taiwan have also decreased over time.
GARENA POSITIONING
Garena should attempt to expand, or offer more English based games. They could position themselves as an exclusive supplier for games that want to test out Taiwan audiences from either Western companies or Chinese companies like possibly getting beta license to monitor gamers, and using the platform to report back to game developers. While mobile gaming has continued to grow and penetrate the market, there is the possibility that the number of gamers will cap out within Taiwan. As gaming industries like Blizzard tap into Taiwan, Garena can continue to build partnerships, tap into stadium events, and pushing the platform to offer more to their users. For example the Kek.tv Hong Kong-based app has raised millions and provides users a way to "consolidates gaming video and news content from around the world". Staying ahead of these edges, and potentially offering internet based services that are attractive to Taiwan's interest with expanding business models may also help Garnea secure funding for project from the government.
Continuing to monitor other Asian markets and expanding offerings is also important. A focus in supporting or increasing English capabilities for players may also help attract new players to the platform. Highlighting the potential for mastering both Mandarin and English is what makes Taiwan such an interesting and competitive space.
Other platforms that offer similar services include Steam. They have approximately 1,166,476 ± 93,242 active users in Taiwan. Luckily the most popular games on Steam for Taiwan users include Counter-Strike, Grand Theft Auto V, Left 4 Dead 2, Wallpaper Engine and Dota 2, meaning they do not compete in the MMORPG space. However, they are dominating the first person shooter market for Taiwan gamers. Potential opportunity is here for Garena to offer FPS based games to keep gamers using Garena more exclusively.
PUBLIC PERCEPTION
There are only a few articles about Garena that express a sort of public opinion. One includes a sad farewell to the GPL, as gamers feel the company expanding out and beyond gaming. But the pull away isn't without its rewards as Garena subsidiary Beetalk has gathered success within Taiwan.
CONCLUSION
To wrap it up Gamera already has a large fan base but captures part of the share of gamers. The gaming community has already noted the company's pull away from gamers, but there is a large niche of casual and cute based games that Gamera may tap into.
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