The cloud gaming market in China is expected to grow by 400% in the next 24 months, as the rollout of 5G nationwide spurs growth, said research group CNG.
The Beijing-based group, which released the 2020 Cloud Gaming Industry Survey Report in June, says the relatively new marketplace will become a US$141 million sector by the end of the year. In 2022 it could grow fourfold to $588 million if it can navigate regulation and technological roadblocks.
Cloud gaming is a gaming platform where, instead of downloading data or inserting a disc, the game is run from remote servers and streamed directly via the internet. While conceptually cloud-based gaming is nearly as old as the internet, slow internet speeds, latency and data caps have all played a role in limiting the platform’s potential.
China’s national 5G rollout, which began ahead of schedule late last year, has accelerated consumer internet speeds to unprecedented levels and made high-quality cloud gaming experiences a real possibility.
Lu Chungcong, deputy director at the Information and Communications Administration of the Ministry of Industry, told the media that network providers, China Mobile, China Unicom and China Telecom, had built more than a quarter of a million base stations in China this year.
Lu said by the year’s end Chinese 5G towers dedicated to supporting the 1GB per second download speeds enjoyed in Chinese cities would number close to 600 000.
Although 5G is still in its infancy – with about two-thirds of China’s critical 5G infrastructure still needing to be laid out – and the ongoing trade war with the United States hampering 5G’s global rollout, Chinese gaming developers are pushing cloud-based gaming.
Tencent, the world’s largest gaming company, is developing and re-issuing popular Asian titles like PUBG Mobile, and later this year, Street Fighter, Metal Slug and Pokemon Unite.
Newcomer to the gaming market, Huawei, has paired with gaming giant NetEase to create cloud-based games. The telecoms giant has formed a number of strategic partnerships this year, including working closely with Tencent since March.
China’s domestic gamers number close to 650 million according to gaming firm, Niko Partners.