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An employee of Tianjin Pictograph Technology Co showing a mobile game product. Tianjin Pictograph is among the many Chinese companies that are engaged in developing mobile games based on Android and iOS operating systems for smartphones, targeting customers in China and overseas markets. [Photo/Provided to China Daily]

Mobile gaming developers look to the West, as competition heats up in the East

Fierce competition in the Chinese mobile gaming market has prompted several international game developers to scale back their aggressive China expansion plans and forced some domestic developers to set their sights overseas.

Thanks to the nation's wider adoption of smartphones, the country has seen rapid growth in mobile gaming in recent years. However, a mere two out of every 10 mobile application developers in the country actually made profits, said a report published by consulting firm iResearch.

A majority of the game developers are losing money and only a very small share of mobile games, such as Fishing Joy, become the lucky ones in terms of popularity and profits, analysts said.

"Capital and software development teams have thronged the mobile gaming field, leading to chaos and overheating," said Wang Ying, an analyst with the Beijing-based research firm Analysys International.

There were 220 million smartphone game players in China by 2012, a year-on-year increase of 31.8 percent, statistics from Analysys International showed.

The market volume of China's smartphone gaming industry reached 6 billion yuan ($963 million) in 2012 and the figure is expected to grow to more than 20 billion yuan over the next three years, Wang said.

However, foreign gaming developers are now having second thoughts on China and have tended to cool their urge to expand in the market aggressively.

"The Chinese mobile gaming industry is very competitive," said Kevin Chou, co-founder and chief executive officer of Kabam, a US-based free-to-play game provider.

"Kabam has decided not to expand to the Chinese market right now but instead focus more on introducing good Chinese web and mobile games to the Western world," Chou said.