Firms bet big on games market

Alongside its Singapore partner, Infocomm Asia Holdings, Philippine games company IP e-Games launches online game Granado Espada .
Written by Joel D. Pinaroc, Contributor

PHILIPPINES--Local online games company IP e-Games and Singapore's Infocomm Asia Holdings (IAH) are seeing huge potential in the Philippines online games market, following the launch of a game title that the two companies hope will ring in the cash registers.

The online games arm of Philippine-listed company IPVG, IP e-Games on Saturday announced the commercial launch of Granado Espada , in partnership with IAH.

IAH and IPVG earlier this year signed a deal to address the Philippines premium games market, including the distribution of Granado Espada , though financial details of the agreement remained under wraps.

The two partners said they have poured millions of dollars in licensing fees to exclusively distribute the online game, which was developed in South Korea.

Both companies said the announcement is significant because Granado Espada  is one of several premium game titles expected to churn revenues not only in the Philippines market, but also for the whole Southeast Asian region.

IAH said online games are starting to mean big business for various Asian markets including Singapore, the Philippines, Malaysia and Indonesia.

In an interview with ZDNet Asia, IAH Deputy CEO David Ng said these countries "represent emerging markets in Asia with huge potential" and added that his company is intensively looking to invest more in these areas. The Singapore company aims to be a major games distributor in Southeast Asia, and is backed by five main investors including Singapore government-linked investment arm Infocomm Investments and Germany's Commerzbank Asset Management.

"It takes more than US$62 million to develop Granadao Espada , and a few more million dollars to license the game... So yes, we are looking at these emerging market very seriously," Ng said.

Aside from licensing fees, he added that a company also needs to shell out more money to acquire high-end servers to support development work. He declined to disclose figures on how much IAH has poured into the Granadao Espada  joint venture with IPVG.

Elaborating on IAH's decision to invest in online games, Ng said the Singapore government has long recognized the huge potential and impact of games.

"Southeast Asia currently has 15 million online gamers and an average Internet penetration of 15 percent," he said, emphasizing that these figures are growing at a torrid rate.

"We are seeing the growth of online games outside South Korea," he added. "For instance, in China alone, there are about 6 million online individuals playing World of Warcraft ."

Meanwhile, IP e-Games is looking at a hefty target to lure a paying gamer base of at least 900,000 for Granado Espada , according to IP e-Games President Steve Tsao.

He added that the game will not be offered on a free-play scheme, but will instead be targeted at gamers willing to pay just to play.

Tsao said: "What we are targeting are not really the first-time players. Granado Espada  is a premium title, which means it has more to offer than most existing online games in the market."

Joel D. Pinaroc is a freelance IT writer based in the Philippines.

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