NOV. 25, 2010 • Crytek GmbH announced it first online F2P first-person shooter title, Warface. The game uses the CryENGINE 3 platform for high-quality visuals, and was developed at Crytek Seoul primarily for the Korean market. Multiplayer co-operative and PvP features are planned. Chinese publisher Tencent has acquired the exclusive rights to market the Warface in China.
Impact: Outside of Blizzard’s World of Warcraft, few Western developers have had significant traction in the Chinese and Korean online games market mainly due to regulatory and language barriers along with intense competition from local games companies. We see Crytek’s strategy of creating a local development studio to penetrate the Asian market as the likeliest path of entry into Korea. Chinese regulatory requirements necessitate partnership with a domestic operator such as Tencent, but since Korean games companies already have a foothold in the Chinese market via such partnerships the choice to develop content in Korea was obvious to Crytek. We suspect other western companies currently not publishing in mainland Asia will follow the same strategy.