Zynga enters China:
Zynga Partners With Tencent to Offer Chinese Version of ‘CityVille’ Game
By Jun Yang - Jul 26, 2011 2:25 AM CT
Bloomberg
Zynga Inc., the largest developer of games on Facebook Inc.’s site, will offer a Chinese version of “CityVille” via Tencent Holdings Ltd.’s service to bring its most popular game to the world’s biggest Internet market.
Called “Zynga City,” the game will be available on Tencent’s Pengyou service within days before a broader release, San Francisco-based Zynga said in a statement today. The game will be offered in the Chinese language and feature elements inspired by Chinese traditional and pop culture, Zynga said.
The tie-up with Tencent, China’s biggest provider of online games, marks Zynga’s first push into the country, where Mirae Asset Securities Co. forecasts the social mobile-game market will more than quadruple to 27 billion yuan ($4.2 billion) by 2015. The partnership also builds on Zynga’s plans to expand beyond Facebook as it seeks to raise $1 billion in an initial public offering.
“Tencent’s strategy is to offer platforms with a wide variety of games and other services,” said Jim Tang, an analyst at Shenyin & Wanguo Securities Co. in Shanghai. “They have a huge client base. If you cooperate with them, Tencent can guarantee a very large user base.”
Shares in Tencent rose 1 percent to HK206.20 as of 3:17 p.m. in Hong Kong trading.
Tencent had about 101 million users for its Pengyou site, President Martin Lau said on May 11. The company plans to increase spending this year on services including social media, Chief Executive Officer Ma Huateng said in March.
Zynga said in its IPO filing on July 1 that revenue surged almost fivefold in 2010 to $597.5 million, compared with 2009. The game maker also turned profitable last year, recording net income of $90.6 million, following a loss of $52.8 million.
The company cited its reliance on Facebook as a risk factor for its business in the filing, with “substantially all” of its first-quarter sales generated on Facebook.
To contact the reporter on this story: Jun Yang in Seoul at jyang180@bloomberg.net
To contact the editor responsible for this story: Young-Sam Cho at ycho2@bloomberg.net
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