More than 100 online game developers gathered at China Digital Entertainment Forum in Shanghai yesterday to discuss marketing, technical, and regulatory issues affecting the multi-billion yuan industry in China.

Among the more than 20 speakers were senior executives from the leading foreign and domestic IT companies and game developers, including Sony, Microsoft, IBM, Netease, The9, Blizzard and Tencent.

The forum is a prelude to the 3rd China Digital Entertainment Expo and Conference, opening today at the Shanghai New International Expo Center in Pudong. The expo is being organized by various central government departments, in addition to the Shanghai Municipal Government.

Yesterday's event focused on the development, diversification trends of the digital entertainment industry, as well as technical and market challenges.

Influential foreign digital entertainment associations have shown support through their participation, including the International Game Development Association, Korea Game Digital Institution and ESA, an US online game developers' association.

According to the organizers, hundreds of online entertainment companies from around the world will display their latest products and services at the expo over the next three days.

China's online game industry is developing rapidly. According to figures compiled by IDC, a major IT industry research company, the mainland market for online games grew 46 percent from a year before, while the number of online game developers more than doubled. The number of new games placed on sale in 2004 rose 139 percent from 2003.

The number of online gamers has reached 20 million, government figures show.

"In this new age, online games will become an increasingly popular form of entertainment," said Chen Tianqiao, CEO of Shanda Interactive Entertainment.

Industry sources predicted that more than 100 new online games will be developed, with a total investment of between 1 billion and 1.5 billion yuan (US$120 million and US$180.7 million).

Developers are also expected to more widely apply the new technology of virtual reality in game development. Two new virtual reality games, TianXia and DaTang, are expected to be released soon by Netease, according to the company's founder Ding Lei. Netease is one of the largest online game developers on the mainland. It achieved a one-time record of 1.13 million players online.

"However, we still face lots of challenges," said Chen, noting that the industry's biggest constraints are limited technological skills and financial resources.

"Too many developers have only one product to offer," he said. "They will need to develop a range of products to survive the increasingly fierce competition."

The ever increasing functions built into mobile phones are creating a strong demand for what industry experts called "mobile content," Joe Lin, general manager of Softstar from Taiwan, said in a speech. "With the rapid growth of penetration of mobile phones, mobile content has become the next focus of development after mobile terminals."

He said that traditional game developers have played a "crucial" role in the early stages of development that has paved "the road of success" for "mobile gaming."

However, the online game industry, as a whole, is still plagued by the shortage of talent, developers said. Many speakers at the forum expressed concern that they were experiencing difficulties in finding enough specialists to develop new and more complicated games to meet market demand.

The government is known to be planning to launch a '1+10' programme to nurture the next generation of creative IT professionals.

Another nagging issue that has been troubling game developers for years is inadequate intellectual property rights protection. However, many speakers at the forum said they are taking comfort from the latest government efforts in addressing the issue.

"We will monitor and deal with piracy severely," said Yan Xionghong, deputy director of National Copyright Administration.

"We encourage creativity and are most serious in protecting the rights of the original developers," he declared.

Recognizing the increased popularity of online games among young people, Yang Xiaodu, deputy mayor of the Shanghai municipal government, said the community should create a healthy, balanced and entertaining environment for youth.

"We hope this exhibition will help to spark the fire of imagination and creativity in the fast-developing on-line game industry," said Yang.

(China Daily July 21, 2005)