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In This Issue

+ Chinese online games market grew more than 63% to reach $2.8 billion in 2008.
+ Available Pearl Research studies

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April 2009 Newsletter

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- Digital Music

- Taiwan, India and other emerging markets

- Online Games Market

- Casual Games

Games Market in China up 63% to $2.8 billion

Pearl Research forecasts the online games market in China will exceed $5.5 billion in 2012. The market grew more than 63% to reach $2.8 billion in 2008. These findings are contained in Pearl Research’s new 140-page “Games Market in China” study. Table of contents: http://www.pearlresearch.com/files/PearlResearch_2009_Chinareport_TOC.pdf

Many Chinese game operators continue to be optimistic in 2009, stating that the
worldwide economic downturn has had little effect on their business. Games constitute a
small-ticket item and users have not cut back as much on this type of discretionary
spending.

Trends to track in 2009 include the growth of social networking sites in China, with over 55 million users, and their cross-pollination with games.

One overall concern is the lack of diversification with many game operators relying on a single title for the bulk of revenues. In addition, a glut of content with more than 200 games on the market, makes releasing a breakout hit increasingly difficult.

Pearl Research’s findings:
- China’s most popular online game, Netease’s “Fantasy Westward Journey”
achieved 1.8 million peak concurrent users, followed by Giant’s “Zhengtu
Online” with 1.5 million users, Tencent’s “Dungeon and Fighter” at 1.2 million
users, and Blizzard’s “World of Warcraft” at 1 million. Average concurrent user numbers are also available in the report.

- Game operators in China experienced strong revenue growth in 2008. Six game
operators, Tencent, Changyou (CYOU), The9 (NASDAQ: NCTY), Netease
(NASDAQ: NTES), Shanda (SNDA: NTES) and Giant (NYSE: GA) crossed the
$200 million revenue mark.

- Approximately 70% of China’s 298 million Internet users are under the age of 30.
This group is most likely to seek out online entertainment, including games,
music, and chatting, which Pearl Research believes will drive revenues for the
online gaming market.

The report contains 2006 to 2013 forecasts; inhibitors and drivers to growth; deep marketplace analysis; profiles of key market players; and strategic conclusions. Please call (+1) 415-738-7660 or email research (at) pearlresearch.com to purchase this report. Table of contents: http://www.pearlresearch.com/files/PearlResearch_2009_Chinareport_TOC.pdf

Studies and Updates

i. Emerging Markets: Online Games Market in Vietnam and Korea Available Now

Click here for a table of contents of our Korean digital entertainment study, available now. This study tracks emerging trends, identifies any opportunities for international companies and examine lessons learned from the world’s most dynamic digital entertainment market.

This comprehensive study contains an executive summary, market forecasts up to 2011, deep marketplace analysis, company profiles and strategic recommendations. Visit this link for more information: http://www.pearlresearch.com/newsl/GamesMarketKorea_0808_PearlResearch.pdf

For the Vietnam table of contents, visit this link: http://www.pearlresearch.com/files/Sample_PearlResearch_OnlineGamesVietnam_0811_TOC.pdf

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