Shanda bringing 'DOA' to China

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BEIJING -- Shanghai-based Shanda Interactive Entertainment, a leader in online gaming in China, said Tuesday that it will operate hit Japanese video game "Dead or Alive" in China's huge gaming market.

Speaking at a Beijing karaoke parlor amid bikini-clad models -- a la the game's fighting heroines -- executives from Nasdaq-listed Shanda and "DOA" creator TECMO said they will jointly develop a PC version of the game for release in China, Hong Kong and Macao before next August when the 2008 Beijing Olympics begin.

The deal for "DOA ONLINE" is the latest in a string of international partnerships looking to tap China's market of roughly 32 million mostly young and male gamers who play online at least once a month.

In March, Hong Kong-based CDC Games, a unit of Nasdaq-listed CDC Corp., invested in MGame, the South Korean developer whose hit game "Yulgang" it has operated in China since 2004 (HR 3/23).

Shanda president Jun Tang said that about 20 million of China's active gamers, people from ages seven to 70, play at least one of the 25 games Shanda offers, from fighting games to online chess to games for young girls.

"DOA" will operate on the "come-stay-play" revenue model that -- rather than charging a subscription fee -- allows gamers to play for a fee and then makes additional money by selling them added powers for their online avatars.

Jun said Shanda expects to earn more than $250 million in 2007, based on the most recent quarter's earnings of $60 million. He also projected a 30% revenue growth in China's overall gaming market over the next three to five years as more homes get broadband Internet connections.

"As the market leader, we hope to grow faster than that," Jun said.

The original "DOA" has become Tokyo Stock Exchange-listed TECMO's flagship title, selling 7.5 million copies since its creation as an arcade game in 1996. It is available for the Sega, PlayStation, Dreamcast and Xbox home gaming consoles.

But console gaming has not taken off in China, where the imported hardware is considered too expensive.

To reach more Chinese gamers, Shanda also will launch "DOA ONLINE" on its EZ Platform, a software package that allows the use of a joystick with a PC instead of the PC's keyboard and mouse.

Further to this end, Shanda games will later this year begin to appear pre-loaded in the PCs made by such Chinese manufacturers as Lenovo, the company that bought IBM's struggling laptop business, Jun said.
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