MAY 5, 2014 • The three major China mobile carriers – China Mobile Ltd., China Telecom Corp., And China Unicom Ltd. – have agreed to jointly publish 100 smartphone games by the end of the year. The three telecoms will set up a panel to weigh submissions from game studios and will then manage the incorporation of those titles selected onto their platforms, oversee payment processing, as well as marketing the content. The initiative is based on the conclusion that there are a good number of excellent games going un-noticed amidst the thousands being developed for the Chinese market. The three carriers have set a modest revenue target of 1 million yuan ($160,000) per year for each of the titles they publish.

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Impact: The expansion of 3G networks in China during the last three years has been explosive, and the growth in smartphones as game platforms has been equally off the charts. Blink and you probably will miss a major opportunity in the market. That’s why we believe these three telecoms are likely late to the game publishing party. All of these carriers already have their own game platforms that combined currently service more than 300 million users, according to China Unicom. China Telecom, for example, operates both its own Ai Youxi platform, plus has a joint venture with Netease to develop a chat platform called YiChat to compete with Tencent’s ascendant WeChat. Our question is how many great, unknown smartphone titles are out there that can draw in existing players to telecom game platforms? Also does the market really suffer from having too few games for consumers to choose from? The carriers do have the ability to ship hardware with their own game titles pre-installed, which might rope in new smartphone owners who have yet to become mobile gamers. But that’s a lot to ask for from undrafted rookies, borrowing the National Football League term for college players who are not taken by pro teams in the draft. China Mobile, China Telecom and China Unicom might find some gems, but we suspect the number will be too few to sustain and grow a meaningful mobile publishing operation.