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.

Sunday, August 4, 2013

XYQ got a record high for 2013, part 9

This is part 9 of a long running series, the previous article in this series can be found here:
part 8 here

In February this year, NTES increased the money it charges its players by 50%. Considering that XYQ and XY2 are one of very few paying games in the world while the market is dominated by free to play games, NTES was conducting a very dangerous gamble.

But since XYQ and XY2 are the largest revenue generators for NTES, if this gamble is successful (that there are not a lot of player loss), it would mean great news for NTES.

On 8/4/2013, at 14:55pm Beijing time, NTES achieived a PCU=2633380 players. Please see the following news (in Chinese):
2nd highest in record

To put this is perspective, the Peak Concurrent Users (PCU)
PCU = 2630k for 2013
PCU = 2710k for 2012
PCU = 2300k for 2011
PCU = 2600k for 2010
PCU = 2560k for 2009
PCU = 2320k for 2008

While this is not the all time record, it is still amazing considering each players are spending 50% more to play comparing previous years.

It is clear that NTES is able to reverse the player loss due to fee increase. NTES adds a lot of new contents for XYQ and add a mobile game option, XYQ is actually starting to grow again. This is clearly beyond my wildest imagination.

I am extremely impressed by NTES ability to understand its customers. I don't know of too many other cases where a company can increase its fee by a whopping 50% at one time and proceed to starting major growth 6 months later.

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