1.    AppLovin proposes to combine with Unity for about US$17B

• AppLovin, the mobile monetization platform, announced today it has submitted a non-binding proposal to Unity. Offering to “combine” with Unity, it’s more of a proposed acquisition for what would amount to about US$17 billion
• The proposal is for an all-stock deal valuing Unity’s stock at $58.85 per share, an 18% premium to Unity’s Monday closing price
• Unity would have to terminate its planned acquisition of Ironsource, one of AppLovin’s competitors. The company intended to use Ironsource’s tools to give its creators more options to monetize their creation
• Unity announce 9% revenue growth, but lower annual guidance in Q2 results - no comment on Applovin deal

2.    Chinese gamers diminish following regulations, but a rebound is high

• The NPPA (National Press and Publication Administration) further strengthened anti-addiction regulations and reduced the amount of time that minors can play online video games from September 1, 2021. The new rules stated that people under 18 years old will be allowed to play only on Friday, Saturday, Sunday and legal holidays, for one hour per day between 8pm and 9pm. This limits minors to 3 hours per week
• Gaming penetration peaked in 2020 with 60% of Chinese youth playing games (vs 52% of the overall population)
• After the 3-hour regulation was implemented, the percentage of youth gamers dropped to 40% (vs 49% of the overall population)
• Niko forecast a return to near peak levels by 2026 with 56% of the youth population playing games (compared to 51% of general population)
• 77% of Chinese youth play fewer hours per week as a direct result of the regulation
• 54% of youth gamers now only play within the approved hours set by the government as a result of the 3-hour regulation
• 54% of primary school students play video games, compared to 72% of junior high school students and 62% of senior high school students. The decline for senior high school students can be attributed to higher studying hours and less leisure time compared to other students
• 86% of youth gamers play on mobile, 30% play on PC and 6% play on console
• While we expect the esports talent pipeline to be negatively impacted, games with an esports component continue to remain the most played among youth and the older a child gets, the more likely they are to be interested in esports

3.    Capcom veteran Hiroyuki Kobayashi joins NetEase

• Capcom veteran Hiroyuki Kobayashi announced on Twitter today that he is joining NetEase after departing the Resident Evil publisher
• Kobayashi was a programmer on the original Resident Evil, which released back in 1996. He has served as a producer on several subsequent Capcom games, including Resident Evil 4 and Devil May Cry 4
• He isn’t the only Japanese developer to join the Chinese gaming conglomerate. NetEase acquired Suda51’s Grasshopper Manufacture in 2001

4.    Chinese tech giant invests alongside CIA fund in British Army software

• Tencent has disregarded rising tensions between Beijing and the West to invest in a British start-up building simulation software for the Army
• In a deal said to be too financially insignificant to trigger a National Security review, the Chinese gaming company took part in a £15m funding round for Hadean, which develops technology to allow tens of thousands of virtual soldiers onto digital battlefields
• In a further twist, Tencent joined the funding round alongside In-Q-Tel, a US venture capital investor backed by funds from the CIA
• Hadean was founded in 2015 to re-imagine distributed, spatial and scalable computing for Web3.0 and Metaverse. Its distributed cloud platform provides the basis for web3.0 applications for Metaverse, enterprise organizations and the defense sector

5.    Korean market key as Nexon experiences a record-breaking quarter

• Nexon’s record-breaking revenue in the Q2 was driven by a combination of great games and best-in-class live operations," said Nexon CEO and president Owen Mahoney
• The improved performance of MapleStory in Korea, and Dungeon&Fighter franchise in both China and Korea contributed to the growth
• Part of the company’s success was the result of the strong performance of FIFA Online 4 on PC and mobile
• FIFA Online 4 and Dungeon&Fighter Mobile were the company's biggest mobile hits
• The company’s revenue was within the range of US$623 million, an increase of 50% YoY on an as-reported basis and 40%on a constant currency basis
• Also, Kakao Games' Q2 operating profit surged 900% with Uma Musme's success - the highest since it foundation
• Overall, the Korean game industry's Q2 performance is weak due to high labor and marketing costs
• Many new Korean major games will be released in 2H 2022

1. Netmarble is releasing a total of six new titles, including the blockchain game 'Everyone's Marble: Metaworld'
2. Krafton plans to introduce 'Project M' in Early Access (Early Access) to the global game platform Steam, and launch 'Calisto Protocol' globally in December 2022
3. NCsoft plans to enter North America and Europe for 'Lineage W' and launch 'TL' (PC/Console) in the second half of the year
4. Com2uS will also release 'Summoners War: Chronicle' in Korea on the 16th Aug 2022

6.    Mobile games more profitable than console AND PC combined, reports Activision Blizzard

• Activision Blizzard earned US$831 million dollars from mobile sources between March and June 2022 - more than half of all of the company’s total revenue for the quarter - according to the company's Q2 financial results
• Call of Duty Mobile, Diablo Immortal and Candy Crush central to US$1.64 billion Q2 revenue
• Mobile revenue from Q2’ 22 compared with PC revenue & Console revenue: PC: US$332 million and US$367 million from assorted consoles
• Games by mobile developer King proved to be an exceptionally strong performer for Activision Blizzard, with its portfolio accounting for US$684 million of the company’s mobile revenue – more than 82% and just shy of 42% of the company’s total revenue for the quarter

7.    Netflix games only engage a slim minority of its streaming audience

• Netflix Games have engaged less than 1% of its subscribers, which currently stand at 220.67 million worldwide - or around 2.5 million players - since its launch last November. This information comes from a data analytics report from Apptopia, as first reported by CNBC
• Downloads on the games service come in at approximately 23.3 million, with the service averaging 1.7 million daily users
• The company’s greatest success in the games space came with a crossover between Stranger Things and the popular horror game Dead by Daylight, which Netflix ended last year as part of its strategy of increasing its own profile within the industry. The Queen's Gambit Chess by Ripstone Games will be released later this year
• MI Insight

1. Less than 1% of Netflix subscribers downloading games is "not a bad start. Netflix is only just getting started with its video games offering
2. Neftlix hoping to bring its catalogue from 24 titles currently to 50 by the end of the year, which would double its offering
3. Main challenge is ramping up release schedule and publishing on other platforms
4. Historically there have been hugely popular platforms that have added instant games or storefronts to their offerings that haven’t been wildly successful  but the difference with Netflix is that it has that all important IP that could cut through

8.    PlayStation Mobile seeking to acquire mobile studios to help realise expansion goals

• PlayStation Mobile is looking to increase its profile within the mobile games space, starting with the search for a new director of business development
•  Acquisitions are in the pipeline once the company appoints its new director of business development
• PlayStation has a huge catalogue of diverse first-party IP that can transition to smartphone gaming and complement our triple-A games or live service games
• This recent push into the mobile market comes as a part of PlayStation diversifying its portfolio, including upcoming adaptations of hit titles The Last of Us and Ghost of Tsushima
• Recently, allegations have been flying that the company is eyeing an acquisition of Final Fantasy developer Square Enix

9.     Tower of Fantasy is launched globally on 11th Aug, topped US, Japan & Korea, Taiwan & HK iOS Free lists

• Tower of Fantasy topped  iOS free list in the United States, Japan, South Korea, and Hong Kong, Macao and Taiwan regionson the first day of launch, and has also ranked among the top 10 iOS free lists in more than 90 countries and regions around the world
• In addition, the overseas PC version of this game was released at the same time
• The game was published by three companies in different markets. Among them, Iwplay World published the game in China's Hong Kong, Macao and Taiwan regions, Perfect World did self-publishing in South Korean Market and Tencent’s :Level Infinite published the game in Japan, the United States and other major regions
• The game achieved Pre-reg globally with 4 million players, with great localization events

10. Dynasty Warriors: Overlords Officially Released

• New mobile ARPG 'Dynasty Warriors: Overlords' officially released on Aug 10th for SEA markets by VNG Games Publishing for both AOS and IOS devices
• The hack-and-slash game genre adapted from one of the best Dynasty Warriors series 'Dynasty Warriors 7', with additional game PvE, PvP and Guild features, and stunning 3D gameplay graphic
• Players will enjoy to use their favorite generals in Three Kingdoms history, with their unique abilities and bond skills with other generals.
• Players would get bonus advantage by joining the pre-registration and following 8 days daily login event to get popular general 'Guan Yu'

11. Global revenue ranking of Chinese mobile game publishers in July: Tencent NetEase miHoYo continues to be the top 3

• A total of 39 Chinese Publishers are shortlisted in the TOP100 Grossing global mobile game publisher list, with a total revenue of more than US$2.03B, accounting for 38% of the global TOP100 mobile game publisher revenue
• Tencent

1. With the opening of the SS19 season, the revenue of Game of Peace surged by 23% in July
2. League of Legends E-sports Manager was launched on July 20, making Tencent’s current revenue increase by 6% MoM

• NextEase

1. The Knives Out launched summer event in Japan Market in July, pushed the game doubled the revenue from June
2. On July 25, "Diablo: Immortal" was successfully launched in China market, and quickly ranked among the top three Grossing on China iOS.
3. Driven by these two games, NetEase's game revenue increased by 6.8% MoM

• China iOS App Store Top Grossing Ranking

1. League of Legends E-Sports Manager", "Diablo: Immortal" and "Aobi Island: Dreamland" have been successfully launched this summer, due to the easing of the epidemic and the recovery of travel, the revenue of China's iOS mobile game market is basically the same as June, a decrease of 14% from the peak in April this year and a decrease of 10% from Jul’21

12. Casual mixed genre’s rising: Casual Mobile Games in China market will reach US$5 B in 2022, oversea revenue will increase dramatically

• Overseas market revenue of China's self-developed mobile games is expected to exceed US$17B in 2022, of which casual games account for less than 5%, while mature markets such as the United States and the United Kingdom account for more than 20%. Therefore, China casual games still have a lot of room for growth in the oversea market
• Today's casual games are no longer a simple matching 3 game, but more of a combination of gameplay and moderate tendencies. Among the top products with more than one million downloads, the most common match-3 fusion object are mixed with simulation genre ( accounted for 17% of total 1 million downloaded products) and Puzzle( accounted for 8% of total 1 million downloaded products, also its quite common that matching 3 can be mixed with shooting, action, both accounted for 4% of total 1 million top downloaded products
• There are more and more big gaming companies are marching into the matching 3 / casual games genre such as 37 games with their Puzzle & Survival
• The number of mobile casual game users in China is 520 million, and the penetration rate among the overall game users will be 80%
• Most of casual games rely on ads as requiring revenue, the reason behind is apps that rely on apps as revenue don’t need to apply for game licenses in China Market
• Stumble Guys as a new party game with game play such as Marching 3 & battle royale achieved 50 million downloads, 4 million MAU and US$4.5 Million monthly revenue
• Match Master as a matching 3 mobile game with game plays such as matching 3 & PvP & Social elements achieved 1.5 million downloads & US$2.4 million monthly revenue