Research Areas:  animation, game, creative, digital entertainment, etc.
Enterprises Involved:  Shanda, Sunchime Cartoon, Kingsoft, Greatdreams Cartoon, etc.

Report Summary

As information infrastructure keeps improving worldwide, people's demand for entertainment has started to grow.  Since the middle and late 20th century, major developed countries and regions have been in the transition from production-dominated society to consumption/entertainment-dominated society.  The digital entertainment and cultural creative industries including animation and games become global industries with broad development space that promote communication and exchanges between different cultures, starting to play an increasingly important role in the global economic stage.

Thanks to active efforts made by competent departments, local governments, and enterprises concerned, a host of national digital entertainment, animation and game, and creative bases have been approved in China.  In mid-July 2006, the General Office of the State Council forwarded the Opinion on Promoting the Development of China Animation Industry, which requires that "layout and planning of national animation industry bases shall be made", that "relevant standards shall be set and evaluation mechanism established for the bases", that "the survival-of-the-fittest mechanism shall be adopted for national animation industry bases, with evaluation and adjustments conducted once every three years", and requires governments and competent departments on all levels to map out implementation rules and specific policy measures in light of actualities.

China is becoming a fast growing area in the global digital entertainment and creative industries.  With broad market prospects, China digital entertainment industry holds an increasingly important status in the world.

Nevertheless, on the whole, China animation and game industry faces a slew of problems, such as shortage of professionals, narrow financing channels, and poor original development capability.  For a long time, animation works and games from the U.S., Japan, and South Korea have been occupying China original creative market.  A profound phenomenon is that some animation works and games from the U.S., Japan and South Korea are originated from the Chinese culture.  For example, based on the Mulan Poem, which is widely known in China, Disney animation Mulan is wildly popular worldwide.

On a deep level, the development of the digital entertainment industry including animation and games is a process of cultural inheritance and constant innovation.  The deep cultural heritage of the Chinese nation lays solid foundation and is the rich source for the development of China digital entertainment industry.  On the one hand, thanks to broad market prospects, China has become a new market that foreign giants compete for; on the other hand, apart from national industry bases approved by the State, many cities take the animation and game industry as a new growth point, and competition between cities across the country is escalating.

In the face of the situation and challenges mentioned above, how to understand the present situation and development trend of the animation and game industry, how to draw upon domestic and foreign experience, how to tap investment opportunities, how to seek potential opportunities in various links of the industry chain for boosting competitiveness, and how to analyze key factors affecting the improvement of competitiveness and resources that match the factors and take relevant measures are important questions to enhance the competitiveness of China animation and game industry.

Tracking the animation, game, digital entertainment, digital content, and media industries for a long term, we released the 2006-2007 Annual Report on Investment Opportunities in China Animation & Game Industry.  The report provides reference for operation and investment decisions to domestic competent departments on all levels, industry bases, domestic and foreign media groups, animation and game companies, and investment institutions in the following aspects:

1.  External Environment:  the report presents the present situation and development trend of the global and Chinese animation and game industries, and depicts the overall industry layout.
2.  Experience:  it analyzes and discusses the successful experience of major countries and typical international enterprises in the animation and game industry, based on which presents experience that are practical for Chinese competent departments, industry bases, and enterprises.
3.  Analysis of the Industry Chain:  the report provides an overview of China animation and game industry. With the industry chain for animation and games as thread, it examines competition and profitability of various links of the industry chain to analyze opportunities for improving competitiveness, thereby enhancing the overall competitiveness of China animation and game industry.
4.  Practice in China:  it sums up the experience of typical cities, industry bases, and enterprises concerned.
5.  Assessment of Competitiveness and Investment Opportunities & Recommendations:  it analyzes key factors that the animation and game industry needs to match, and gives the factors of competitiveness evaluation and description of the factors.

Through competitiveness assessment index system, it conducts overall and specific assessment of the animation and game industry in major Chinese cities and industry bases, to provide decision reference for vendors and institutions to select investment locations.  Meanwhile, it presents recommendations and strategies for improving the competitiveness of China animation and game industry.

Report Outline

Main Conclusions
Key Findings

Chapter 1    Overview of the Global Animation & Game Industry, 2006

1.1    Present Situation
1.2    Basic Characteristics
1.3    Experience from of Major Countries
    1.3.1  U.S.A.
    1.3.2  Canada
    1.3.3  Britain
    1.3.4  Japan
    1.3.5  South Korea
1.4    Experience from Leading Enterprises
    1.4.1  Disney   
    1.4.2  Toei Animation
    1.4.3  DreamWorks
    1.4.4  SEGA
    1.4.5  NC Soft

Chapter 2    Overview of China Animation & Game Industry, 2006

2.1    Profile
2.2    Basic Characteristics
2.3    Overview of Major Cities
    2.3.1  Hangzhou
    2.3.2  Chengdu
    2.3.3  Beijing
    2.3.4  Shanghai
    2.3.5  Shenzhen
    2.3.6  Changsha
    2.3.7  Dalian
2.4    Experience from Major Enterprises
    2.4.1  Shanda
    2.4.2  Kingsoft
    2.4.3  Sunchime Group
    2.4.4  Tencent
    2.4.5  Netease

Chapter 3    Analysis of the Industry Chain for Animation & Games in China, 2006

3.1    Industry Chain
    3.1.1  Composition of Industry Chain
    3.1.2  Analysis of the Industry Chain
3.2    Competition & Profit Status in Field Segments
3.3    Competition & Profit Status in Various Links of the Industry Chain

Chapter 4    Competition Situation in China Animation & Game Industry, 2006

4.1    Competition Situation
4.2    Assessment of Leading Enterprises Competitiveness

Chapter 5    Analysis of the Growth of China Animation & Game Industry, 2007-2011

5.1    Factors Affecting the Growth of the Industry
5.2    Analysis of the Growth of the Industry

Chapter 6    Development Trend of China Animation & Game Industry, 2007-2011

6.1    Development Trend
6.2    Forecast of Size

Chapter 7    Investment Opportunities in the Key Fields of China Animation & Game Industry, 2007-2011

7.1    Analysis of Investment Opportunities
7.2    Assessment of Investment Value
    7.2.1  Overall Assessment
    7.2.2  Assessment of Field Segments

Chapter 8    Recommendations

Tables

Table:  National Animation & Game Bases in China
Table:  Animation & Game Bases in Major Cities across China
Table:  Comparison of Competition and Profit Characteristics of Various Links of the Industry Chain for Animation & Games
Table:  Comparison of Competition and Profit Characteristics of Various Links of the Industry Chain for the Industry Segments
Table:  Overall Assessment of the Investment Value in China Animation & Game Industry
Table:  Assessment of the Investment Value of China Game Industry
Table:  Assessment of the Investment Value of China Animation Industry

Figures

Figure:  Size of the Global Online Game Industry, 2001-2006
Figure:  Size of the Global Animation Industry, 2001-2006
Figure:  Size of China Online Game Industry, 2001-2006
Figure:  Size of China Animation Industry, 2001-2006
Figure:  Compressive Assessment of Major Chinese Cities' Competitiveness in the Animation & Game Industry
Figure:  Assessment of Major Chinese Cities' Competitiveness in the Animation Industry
Figure:  Assessment of Major Chinese Cities' Competitiveness in the Game Industry
Figure:  Forecast of the Size of China Animation Industry, 2007-2011
Figure:  Forecast of the Size of China Online Game Industry, 2007-2011