Bloomberg News

Shanda May Buy IPhone Game Publishers, Diversify From Android

June 21, 2011

June 22 (Bloomberg) -- Shanda Games Ltd., China’s third- biggest operator of online games, plans to buy companies that develop titles for users of Apple Inc.’s iPhone to expand its mobile-game division, Chief Executive Officer Alan Tan said.

Acquisitions and in-house game development will allow Shanda to offer its first iPhone titles in 2012, Tan said in a June 20 interview in Hong Kong.

Shanda is boosting development of games for handsets and social-networking sites such as Facebook Inc.’s after losing market share for computer-based titles in China to rivals including Tencent Holdings Ltd. Last year, the Shanghai-based company spent about $200 million on acquisitions, including the purchase of Mochi Media Inc., a U.S. publisher of games that run on Google Inc.’s Android system.

“We have a very good track record on buying companies,” Tan said. Shanda is making Android and iPhone versions of its computer-based games including “World of Legend,” he said.

NetEase.com Inc., based in Beijing, accounted for 15.3 percent of China’s online games market in 2010 to become the second-biggest operator locally, overtaking Shanda, whose market share dropped to 13.6 percent, according to data from research company iResearch.

Industry leader Tencent’s market share rose to 29.1 percent, according to iResearch.

Shanda is also seeking to boost sales from new computer- based games such as “Dragon Nest” and “Legend of Immortals,” Tan said. The company still derives more than 90 percent of its revenue from PC-based titles.

Shanda will offer games for the social networking sites run by Facebook, Tencent, Sina Corp. and Renren Inc., Tan said earlier this month.

--Editors: Suresh Seshadri, Anand Krishnamoorthy.

To contact the reporter on this story: Mark Lee in Hong Kong at wlee37@bloomberg.net

To contact the editor responsible for this story: Young-Sam Cho at ycho2@bloomberg.net


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