Outside China the summer months are normally not the best months for online gaming portals. But in China things are different, July and August are always the best period for Chinese entertainment sites. Last year we broke all records for Spil Games’ Chinese sites during the summer and this year looks like it will be exactly the same.

The reason is that a lot of people visiting our sites are students, and they have a lot more time on their hands during the summer holiday than during the rest of the year. Chinese kids normally don’t go on long holidays or play outside a lot, like their European counterparts, and so they spend a lot of their free time behind a computer screen. Furthermore, it’s too hot to do much else in large parts of China, so the internet is a good way to avoid being bored.

We saw the effect in our July stats today. Game.com.cn grew an amazing 50% in July to over 15.2 million unique users and xiaoyouxi.com added about 25% new users to a total of 13.5 million unique visitors during this month. This means we now have a monthly reach of 28 million Chinese players, which is far above my expectations (note: there is likely some 10-15% overlap between the users of the sites, so real reach will be a bit lower). Guo Haibin and his team: congratulations for this amazing result!

Sales are also growing each month (figures are confidential), a sign that the online advertising market is finally starting to grow in China. Of course having sites with huge traffic makes it easier as well, ad agencies and advertisers take us a lot more serious than just a year ago. Too bad most ad sales are still for a fixed period of time (buying a banner position for one day or one week) instead of based on total views (CPM) or clicks (CPC). In that regard the Chinese online advertising market is still years behind.

The only thing that does not take off yet is in-game advertising. Zlong Games (our in-house game development studio) can easily create advertising space in the games it makes, but there is no demand yet from advertisers. Surprisingly, because that is where you can really interact with your audience – if you do it right.

I think one major reason is that the advertising agencies are not selling in-game advertising to their clients yet. Either because they don’t understand the benefits or because they are happy with the status quo. In-game advertising agencies are not gaining much traction yet either, but because of the potential impact of ads in games they eventually will. Until then we just keep on growing our gaming portals!