Even though the VR industry isn't fully mature yet, it's slowly starting to establish itself within existing industries. If earlier years focused on solving the "have or haven't" problem, today it's diving deeper into specialized vertical areas. For instance, in the realm of VR gaming, "distribution" has become a buzzword alongside the games themselves.
When you think about VR game releases, the first thing that comes to mind might be the "Origin for CP" network. Back in January, Aoying Network announced they had secured tens of millions in angel funding, primarily targeting the nearly空白 VR game distribution services market. However, there’s more to the “VR release†business than just Austrian Britain. The content from CP TVR Time Machine also quietly announced its overseas PSVR agency business.
There’s also the VRCORE hard virtual reality developer competition launched in May. They announced they had obtained PlayStation global distribution qualifications and formally entered the issuance business. In June, Gamepoch announced contracts for "Rothland Planet" and two PSVR games, "Dark Legion," handling full global distribution and support; Touch Games also mentioned doing overseas distribution of VR games...
It’s quite lively.
One observer noted that while there are quite a few players in the "publishing" circuit, their goals are surprisingly aligned: either PC VR games or console VR games. Though some might opt for both PC/console VR and mobile VR, few teams focus on "mobile VR game distribution" as their primary business direction. So, when it was revealed that the next business focus of Pangji Network would be on publishing mobile VR games, it truly caught people off guard.
What exactly is Pangji Network up to?
In previous columns, we’ve already introduced Pangji Network to readers—it was founded in 2015. Its core members hail from renowned gaming companies like T4game TianTian You, KongZhi, and Kirin Gaming. On average, they have over ten years of experience. Up until now, they've released nearly 20 mobile VR games, boasting extensive experience in integrating with major platforms. In May this year, Pangji Network announced securing 10 million yuan in Pre-A round financing.
Li Hongli, a partner at Pangji Network, told us that in the future, they plan to walk on both legs ofè‡ªä¸»ç ”å‘ and product publication. For mobile VR game distribution, Pangji Network primarily helps domestic and overseas CPs access domestic mainstream platforms through a cooperative revenue-sharing model. For particularly high-quality content, they also offer certain financial and technical copyright support. Currently, Pangji Network has started introducing overseas products like "Lila's Tale" to domestic platforms, with plans to continue bringing in various high-quality overseas mobile VR games. Li Hongli expressed optimism about the development of mobile VR, saying "(mobile VR game distribution) this path has the potential to achieve profitability."
While the idea is promising, it remains untested in practice. To seize this opportunity, let’s consider a few questions: Can the mobile VR game release path succeed? How should it proceed? Who will lead the way?
What are the pain points in the mobile VR game market?
The traditional game market has developed quite comprehensively, with clear divisions of labor. The release of mobile VR games remains a relatively blank market. Even the PC/console VR games and offline distribution are still in the experimental stages. Fang Xiangyuan, co-founder of TVR Time Machine, described this typical scenario in an interview with the media.
CPs are envious: "Ah, Sony is doing great, hey, why is it so complicated for us?!"
PSVR scratched its head: "Come on, come on, hey, why is it so confusing?"
The same scenario applies to mobile VR. In three different dimensions—
CP: "Development costs are too high. Why are there so many platforms? The input-output ratio is too low, and we might as well focus on the B-side."
Channel: "Where is the good content? Where are the small and medium-sized CPs and overseas CPs? Show me!"
User: "Wow, this gunfighting game is cool! Wow, how is this gunfighting game similar to the one you just made! Wow... how is it still a gun battle game?"
In other words, there is serious information asymmetry between content CPs, channels, and users.
Is it reasonable to release mobile VR games?
The same problem exists in PC games or mobile games. It doesn’t seem to be an issue. However, the issue of mobile VR games stands out. At least some people are skeptical— the market isn't big enough, how many people can sustain it, and who will support it? All the world's laughter is profit, and profit drives the world. If the VR industry is just a new technology and industry without profitable space, would there be so many entrepreneurs/capitals pouring in out of charity? Those days are gone.
Ultimately, the reason why everyone pays attention to the release of PC VR games may be quite simple—"Raw Data" is profitable, and the other side of the console VR game is the same. Despite the tragic situation where numerous content providers have almost no revenue behind the profitability of one or several games, it still proves that VR games are fully capable of making money. That’s enough.
PC/console VR games can be, then mobile VR games can theoretically become, just need to wait for a typical work.
Pangji Network's Li Hongli tells us that "Mobile VR has already been paying off. Mobile VR has a large number of users, including a considerable number of high-quality users. As long as the product quality is good, it will be possible to achieve profitability." In other words, the mobile VR market already has the potential for profitability. This is also the root cause for PangJi Network to choose mobile VR games to launch this business.
There is also a key question. Is the mobile VR market large enough? A recent report on mobile VR circulating in the industry may tell us the answer.
The report shows that in 2016, global downloads of VR applications and mobile games on the App Store and Google Play reached approximately 226 million times, a year-on-year increase of 276% compared to 2015. In the first quarter of 2017, the total number of mobile VR software downloads across the two major stores exceeded 85 million, an increase of 205% from the first quarter of last year. From January 1, 2015 to March 31, 2017, cumulative downloads of VR-enabled mobile applications in the two largest stores in the world reached approximately 371 million.
Despite the exponential growth in mobile VR, the figure of "371 million" alone is enough to prove the huge potential of the mobile VR market. The domestic VR game industry has not yet reached a certain scale, with CPs still struggling. Can distribution be done? The words spoken by the overseas head of Touch Games, Li Wei, at GDC’s speech may represent the answer of many people—
"VR mobile content will quickly flow into all areas, especially in mobile games with the strongest liquidity, and its commercialization is only a matter of time."
Can mobile VR games make money and will there be no food for mobile VR games?
What do you want to do with mobile VR distribution? Who will do it?
For mobile VR games, it's hard to define what kind of behavior is a publisher, and exactly what a publisher wants to do—
Does content CP docking platforms count as issuance?
Does channel docking platforms and CP count as issuance?
So what can a publisher do to be called distribution?
Undoubtedly, all boundaries are ambiguous until the industry matures. But as we mentioned above, the market information of mobile VR games is not symmetrical and requires a publisher role similar to a “broker.†Regarding the issue of what mobile VR distribution should do, we’ve also interviewed many content teams. We may find some answers from their needs.
Docking China's platforms is a very labor-intensive task. We need a team that can help us accomplish this (from a CP overseas);
High development costs, if the distributor can subsidize a development fee, our pressure will be much smaller (from a domestic CP);
It is definitely hoped that the efficiency is higher and the effect is better (from a domestic CP);
......
Selecting high-quality teams and content in CP’s content CP, providing certain capital/technical support to CPs, quickly completing product optimization, docking various content platforms, and ultimately maximizing the value of a certain product. This may be a move. VR distribution should do something that should also be done.
It’s not difficult to come up with such an answer: wanting to do a good job of mobile VR game distribution business, at least should have the following conditions—
Understand VR, be able to narrow down the eyes and filter out high-quality content;
Have the technology to quickly optimize the product;
Understand the market, understand market demands and user needs, and have unique judgments about the preferences of the industry;
With funds, it can provide support for the CP and can support the day when the industry achieves large-scale profitability.
Therefore, mobile VR games can be used for the issuance of this business, but it must be the “four teams with experience, technology, capital, and strength.â€
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