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Take-Two Experimenting with Online NBA Game in China

VentureBeat, 6.24.09

Dean Takahashi

Take-Two Interactive announced yesterday that it’s going to launch an online version of its NBA 2K basketball game in Asia. It will do so in partnership with Tencent Holdings, China’s largest online game operator.

The deal shows that Western game publishers continue to experiment with launching online games in Asia, where the free-to-play business model prevails. That is, the basic games are available for free and players can pay to expand the experience via micro transactions or other fees. The experimentation is important as publishers get ready for the shift from retail to games as an online service.

Christoph Hartmann, president of the 2K Games division of Take-Two, told me more about the deal in a one-on-one interview. He said 2K Sports has cut a multi-year licensing deal with the NBA to launch the game in Asian markets, and it will co-develop the game with Tencent. The game will include all current NBA player likenesses, as well as those of retired players.

“We have been working on this for a while,” Hartmann said. “It’s a natural development, given that China is becoming the biggest market.”

China experienced significant online gaming growth in 2008 and generated $2.75 billion in revenue — a 61% increase from the prior year, according to Nikko Partners.  The Chinese market is projected to reach $8.9 billion in revenue by 2013, with nearly 120 million people playing games online.

China doesn’t seem like a natural market for a basketball game. But Hartmann said the NBA continues to grow in popularity, thanks in no small part to the popularity in China of Houston Rockets star Yao Ming, who is Chinese. For the third year in a row, more than one billion viewers have tuned in to watch the NBA season on TV. Hartmann said the 200-person Take-Two’s studio in Shanghai will work on the game with other parts of Take-Two, including the Visual Concepts sports studio.

Hartmann said the company will shoot for ultra-realistic graphics, which is hard to pull off in an online game. He said it remains to be seen if the team can use art from any of its existing games. He said the team would focus on pulling off the highest quality title and would try to make sure the game is relevant to local consumers. He said the company hasn’t set a launch date yet for the online basketball game.

Electronic Arts has launched an online version of its Fifa soccer game in Korea, where it has more than 5 million players. And THQ is also preparing to launch an online version of its Company of Heroes game in China. Tencent says it had 411 million active user accounts and a peak of 58 million current users as of March. Tencent runs an online game portal, QQ Game, the largest online game platform in China. Hartmann said Tencent made sense as the best long-term partner in China and that Take-Two had no qualms about trusting it.

Take-Two doesn’t disclose worldwide sales of its games, but NPD market research says the NBA basketball game sold 1.5 million units last year. Hartmann said the company has not yet decided on the exact business model it will pursue with the basketball game.