About this Blog

The purpose of this blog is for my personal use. It serves as my personal diary as I investigate Chinese internet/gaming companies for investment purpose. If you have any comments or disagreement, please give me feedbacks.

Tuesday, January 6, 2009

XY3 4Q2008 Prediction

My last article on XY3 can be found here:


The last PCU record is all the way back on 8/15/2008 and it has a PCU > 170k. In addition, on 10/22/2008, it released an expansion pact. Therefore, one would think this game shall perform strongly on 4Q2008, 1Q2009 and 2Q2009.

Now, let's do the 4Q2008 estimate for XY3.

The server counts for the XY3 can be found in the following table:

Considering that this is a very new game (commercial operation on 9/12/2007), and the company just released an expansion pact, this game performed unexpectedly weak during this quarter.

This is not supposed to happen this way. One year ago, XY2 is dying slowly. NTES build the XY3 from the ground up (it even build a brand new game engine). XY3 is supposed to replace XY2. These two are the biggest competitors against each other.

But it turns out players have a change of heart. They don't want to play the new game. For whatever reasons, many of the older players who had left XY2 for many years start to come back.

As a result, the 6 years old game is growing like it is a 1 year old game. And the 1 year old game is behaving like a 6 years old game.

If I am NTES's CEO, I would consider change the chief game designer of XY3.

NTES didn't release a figure for the ACU for this game for 3Q2008. My estimation for the 3Q ACU is 48k. Therefore, my estimate for the 4Q2008 ACU is 48k * 0.999 = 48k.

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