The mobile game market in China is the largest in the world, with a value estimated at $27 billion in 2023. Mobile gaming has rapidly grown in prominence over the past decade, driven by the widespread use of smartphones, the rapid expansion of 4G and 5G networks, and the increasing penetration of mobile gaming platforms across both urban and rural areas. China’s mobile gaming market is highly diverse, encompassing a wide range of genres such as casual games, role-playing games (RPGs), strategy games, sports games, and multiplayer online battle arenas (MOBAs).

With over 700 million gamers in China, mobile gaming has become a central part of the country’s digital entertainment landscape. In addition to the revenue generated from direct game sales and in-app purchases, mobile gaming in China also benefits from the booming eSports, live streaming, and social media ecosystems, all of which heavily involve mobile platforms.

This report delves into the key segments, growth drivers, major players, challenges, and emerging trends that are shaping the mobile game market in China.

Key Drivers of Growth in the Mobile Game Market

Widespread Smartphone Adoption

The most significant driver of mobile gaming in China is the widespread adoption of smartphones. China has over 1.6 billion mobile phones in use, and over 80% of the population uses smartphones, with a large portion of them actively engaged in gaming. With a broad and diverse demographic using mobile devices, mobile games have become more accessible than ever before.

Chinese smartphone brands like Huawei, Xiaomi, Oppo, and Vivo are also integral to the mobile gaming ecosystem, providing affordable and powerful smartphones designed specifically for gaming. The increasing affordability of smartphones means that gaming has become available to a wider audience, including younger individuals, the elderly, and people in rural areas.

4G and 5G Networks

The rapid expansion of 4G and 5G networks has been a major enabler of mobile gaming in China. By 2023, over 70% of mobile internet users in China had access to 5G, and this technology has brought significant improvements in speed, connectivity, and latency, allowing for smoother and more immersive gaming experiences.

5G technology is particularly crucial for cloud gaming, where game content is streamed from the cloud rather than being run locally on devices. This allows players to access high-quality games without needing powerful hardware. The roll-out of 5G is expected to further accelerate mobile gaming adoption, especially for high-definition and multiplayer games that require lower latency and higher data throughput.

Government Regulation and Support

The Chinese government has played an essential role in the development of the mobile game market, both through regulation and support. On one hand, the government regulates the content of mobile games to ensure that they align with national guidelines on social and political issues. The National Press and Publication Administration (NPPA) is responsible for licensing new games and ensuring they meet content standards. This has led to delays in game approvals and stricter guidelines around in-game purchases, particularly for minors.

On the other hand, the government has supported the growth of eSports and mobile gaming as part of its broader goal to enhance the digital economy. The government’s investment in digital infrastructure and innovation has encouraged the development of high-quality mobile games and their integration with social media, live streaming, and eSports platforms.

Rising Disposable Income and Gaming Culture

The expanding middle class in China, with rising disposable income, is fueling the demand for premium mobile games and in-app purchases. According to recent estimates, China’s middle class will exceed 400 million people by 2025, providing a significant market for gaming. As more consumers become willing to spend on entertainment, the revenue generated from in-game purchases, including skins, characters, virtual currency, and loot boxes, has contributed to the massive growth in mobile game revenues.

Gaming has also become a dominant part of Chinese culture, especially among younger demographics. The increasing popularity of live-streaming platforms such as Douyin and Bilibili, as well as social media platforms like WeChat, has further ingrained mobile gaming into the broader social and entertainment ecosystem. Mobile games are no longer just individual experiences but are increasingly social, with players interacting with friends and other players in real-time.

Market Segments in the Mobile Game Industry

Casual and Hyper-Casual Games

Casual games are the most popular and lucrative genre in China’s mobile gaming market, accounting for nearly 40% of total mobile gaming revenue. These games are easy to pick up, have simple mechanics, and often involve puzzle-solving or quick challenges that can be played in short bursts.

Popular Casual Games

• Candy Crush Saga: A global hit, Candy Crush Saga has been a long-time favorite in China, generating substantial revenue through its ad-based model and in-app purchases.
• Subway Surfers: A popular endless runner game, Subway Surfers has seen immense success in China, with millions of downloads and active users.
• Clash Royale: Combining strategy and card-based gameplay, Clash Royale is another leading mobile title that has captured a large Chinese audience.

These casual games benefit from simple mechanics that appeal to a broad audience. They are usually free to download and rely heavily on in-app purchases (IAPs) to generate revenue. The low barrier to entry makes these games accessible to players of all ages, contributing to their massive success in China.

Role-Playing Games (RPGs)

Role-playing games (RPGs) have a significant following in China, especially in the mobile RPG market. These games typically offer complex narratives, character progression, and immersive worlds. In 2023, the RPG segment of the mobile gaming market was valued at over $8 billion, accounting for 30% of the market share.

Popular Mobile RPGs

• Honor of Kings (王者荣耀): Developed by Tencent, this game is one of the most successful mobile RPGs globally and has become a cultural phenomenon in China, boasting millions of active users. It is a multiplayer online battle arena (MOBA) game, featuring short, fast-paced matches and a variety of heroes with different abilities.
• The King of Fighters All-Star: This mobile adaptation of the popular King of Fighters series has found success in China, particularly among fans of fighting games.
• Genshin Impact: Developed by miHoYo, Genshin Impact is a cross-platform action RPG that has become a massive global success. The game has captivated Chinese players with its stunning graphics, open-world exploration, and gacha-based character acquisition system.

Mobile RPGs like these combine the deep narratives and immersive gameplay of traditional RPGs with the accessibility and convenience of mobile devices. The ability to make in-game purchases for new characters, skins, and abilities is a key revenue model in this genre.

Strategy and Multiplayer Online Battle Arena (MOBA) Games

The Strategy and MOBA game segment is one of the most competitive and lucrative in China’s mobile gaming market. These games often feature complex strategies, team-based gameplay, and high levels of interaction among players.

Popular Strategy and MOBA Games

• League of Legends: Wild Rift: The mobile version of the popular League of Legends PC game has been hugely successful in China, attracting millions of players.
• Mobile Legends: Bang Bang: A mobile MOBA game that is popular in China and Southeast Asia, Mobile Legends has a competitive player base and frequent updates to maintain user engagement.
• Clash of Clans: A classic strategy game that focuses on building, attacking, and defending in a fantasy world. It continues to perform strongly in China.

MOBA games, such as Honor of Kings and League of Legends: Wild Rift, have generated billions of dollars in revenue, thanks to their live-streamed eSports tournaments and in-game purchases. These games also benefit from being highly social, with players forming teams, communicating via voice chat, and competing in global tournaments.

eSports and Competitive Mobile Gaming

eSports in China has evolved into a multi-billion-dollar industry, with mobile gaming being a significant contributor. In 2023, the eSports market in China was valued at approximately $4.6 billion, with mobile games accounting for 40% of this total. Mobile eSports have gained considerable traction due to their accessibility and the widespread popularity of mobile games.

Mobile eSports Platforms and Tournaments

• Honor of Kings Pro League (KPL): This mobile eSports league is one of the most popular in China and attracts millions of viewers. It features top-tier players competing for significant prize pools.
• PUBG Mobile Pro League (PMPL): The mobile version of PUBG has a dedicated eSports scene in China, where players and teams compete at the highest level.

The growing interest in mobile eSports has led to investments in broadcasting, live streaming, and game commentary. Streaming platforms like Douyin, Huya, and Bilibili play an essential role in the popularity and revenue generation of mobile eSports, where viewers watch tournaments and interact with streamers.

Game Distribution Platforms

Game distribution platforms play a critical role in the success of mobile games in China. These platforms allow developers to reach a vast audience by distributing their games directly to consumers.

Key Distribution Platforms

• Tencent MyApp: As the largest mobile gaming platform in China, Tencent MyApp offers a wide variety of games and services for Chinese gamers. Tencent’s position as a dominant force in both the publishing and distribution of mobile games is unparalleled.
• Xiaomi Game Store: Xiaomi, a major smartphone manufacturer, has developed its own game store to offer mobile games to its large user base. The Xiaomi Game Store has become a crucial part of the mobile game distribution ecosystem.
• App Store (Apple): Apple’s App Store remains an essential platform for distributing mobile games in China, especially for iOS users. Games like Genshin Impact have achieved massive success on the App Store.

These distribution platforms are critical to the growth of the mobile gaming market in China, serving as gateways for players to access and purchase games. Developers also benefit from these platforms’ ability to reach a broad audience and from the revenue share models, which provide a steady income stream for successful games.

In-App Purchases and Monetization

In-app purchases (IAPs) are the primary revenue model for mobile games in China, making up the majority of the revenue generated by mobile games. Players can purchase virtual goods, such as skins, characters, boosters, and loot boxes, which enhance their gaming experience. This model has proven highly effective, particularly in mobile RPGs and MOBAs, where in-game purchases are deeply integrated into the gameplay experience.

Monetization Strategies

• Gacha Mechanics: Games like Genshin Impact use a gacha system, where players can “pull” for random rewards in the form of characters, weapons, and in-game currency.
• Seasonal Events: Many games, especially MOBA and battle royale titles, feature seasonal events that encourage players to make in-game purchases for limited-time items or skins.
• Ad-Based Monetization: In addition to in-app purchases, many casual games use advertisements as a secondary monetization strategy. Players can watch ads in exchange for rewards, such as in-game currency or extra lives.

The integration of in-app purchases and ads is a key reason why China’s mobile game market continues to experience strong revenue growth. In 2023, the mobile game market in China generated 70% of its revenue from in-app purchases and 30% from ads, further demonstrating the dominance of IAPs in the overall monetization strategy.

Major Players in China’s Mobile Game Market

Tencent

Tencent is the dominant player in China’s mobile gaming market. As the owner of Honor of Kings, PUBG Mobile, and a controlling stake in Riot Games, Tencent’s influence on both the development and distribution of mobile games in China is unparalleled. Tencent also operates WeChat, which is integrated with gaming services, and Tencent Cloud, which supports cloud gaming and streaming services.

NetEase

NetEase is another major player in China’s mobile gaming market. The company has partnerships with global gaming giants like Blizzard to publish popular games such as World of Warcraft and Overwatch in China. NetEase also develops its own mobile titles, such as Identity V and Knives Out, which are extremely popular in the Chinese market.

miHoYo

miHoYo is the developer of the highly successful Genshin Impact, a mobile RPG that has gained immense popularity both in China and internationally. The game’s stunning visuals, deep world-building, and gacha mechanics have made it a standout success in the Chinese mobile gaming market.

Xiaomi

Xiaomi has emerged as a significant player in the mobile gaming market, both through its mobile devices and its Xiaomi Game Store. The company’s smartphones are widely popular among Chinese gamers, and its proprietary app store offers a broad range of mobile games.

ByteDance

ByteDance, the parent company of Douyin (the Chinese version of TikTok), is involved in mobile gaming through its investment in Moonton (the developer of Mobile Legends: Bang Bang) and other mobile game publishing efforts. ByteDance has capitalized on its expertise in social media and content distribution to enter the gaming market.

Future Outlook for the Mobile Game Market in China

Continued Growth of Mobile Gaming

The mobile gaming market in China is expected to continue growing at a strong pace, driven by the expanding mobile user base, the roll-out of 5G networks, and the continued popularity of cloud gaming. As smartphones become more powerful and the digital ecosystem continues to expand, mobile games will likely become even more immersive and engaging, attracting an even larger audience.

Expansion of eSports and Competitive Gaming

Mobile eSports is expected to continue its rise in China, with Honor of Kings, PUBG Mobile, and other mobile games becoming major components of the competitive gaming scene. The growing popularity of mobile eSports tournaments, along with increasing investment from major brands, will continue to drive the development of the mobile gaming industry.

Innovation in Monetization and Game Design

Game developers in China are expected to continue innovating in monetization models, particularly through gacha systems, seasonal events, and in-app purchases. The popularity of subscription models and premium content will also continue to rise as developers find new ways to engage paying users.