Society

China's Gaming Industry: Why Online Games Dominate the Market

Chinese gamers playing online games

Before the release of Black Myth: Wukong in 2024, the consensus among Chinese game industry insiders was simple: "Chinese single-player games are dead." For decades, the Chinese gaming market had been dominated by online games—massively multiplayer online games (MMOs), mobile games, and free-to-play titles with microtransactions. Single-player games, the kind that dominated Western markets, were seen as commercially unviable in China.

What made China's gaming market so different? Why did online games flourish while single-player games struggled to survive? The answers lie in a complex mix of historical factors, economic realities, and business models uniquely adapted to Chinese society.

The Roots of China's Single-Player Game Crisis

To understand why single-player games failed in China, we need to look at two fundamental factors: piracy and wealth inequality.

1. The Piracy Epidemic

In the 1990s and early 2000s, piracy was rampant in China. Street vendors sold pirated game discs for a fraction of the price of legitimate copies, and file-sharing websites made it easy to download games for free. For most Chinese gamers, paying for a game was simply unnecessary—why spend money when you could get the same thing for free?

This created a death spiral for single-player games. Developers couldn't make money selling games, so they stopped making them. Players got used to getting games for free, so they were even less willing to pay. The few legitimate single-player games that were released often sold poorly, reinforcing the idea that single-player games couldn't succeed in China.

2. The Wealth Inequality Factor

But piracy was only part of the story. The bigger issue was China's extreme wealth inequality. In a country of 1.4 billion people, the gaming market follows a striking pattern: out of 100 gamers, 99 might never spend a single cent on games. But that 100th gamer? They might spend as much as the other 99 combined.

This concentration of spending power is unique to China's gaming market. In Western countries, spending is more evenly distributed—most gamers spend some money, but few spend extraordinary amounts. In China, the opposite is true: most gamers spend nothing, but a small number spend fortunes.

The Online Game Revolution: Monetizing the Few

Chinese online game developers didn't fight this reality—they embraced it. They created business models specifically designed to extract money from that small percentage of high-spending players, while letting everyone else play for free.

1. The "ATM/Cattle" Philosophy

In 2007, Feng Ji (later the creator of Black Myth: Wukong) wrote a scathing essay titled "Who Murdered Our Games?" In it, he laid bare the cynical philosophy driving China's online game industry:

"Those damn online game companies have spawned a bunch of people like me—bastards who spend every day thinking about five questions:

  1. How to make players addicted forever
  2. How to make players spend more money
  3. How to make players form gangs
  4. How to make players hate each other
  5. How to implement hidden cash gambling and gold trading"

Feng's essay exposed a dark truth: many Chinese online games weren't designed to be fun—they were designed to be addictive and profitable. Players weren't customers; they were "ATMs" or "cattle" to be milked for money.

2. Turning the Poor into Assets for the Rich

One of the most ingenious aspects of Chinese online game design is how it turns non-paying players into assets for paying players. In many games, the free players aren't just there to enjoy the game—they're there to provide content for the big spenders.

Think about it: in a competitive online game, what good is being powerful if there's no one to show off to? The free players are the audience for the paying players' displays of wealth and power. They're the ones who get crushed by the big spenders' overpowered characters, making the spenders feel good about their investments.

In this system, the poor aren't just irrelevant—they're essential. They provide the context that makes spending money feel worthwhile. And the spenders? They think nothing of dropping hundreds of thousands—even millions—of yuan on a game. It's not just common; it's normal.

The Case of Ski Safari: From $1 to Free-to-Play

The story of Ski Adventure (Ski Safari) illustrates this business model in action. When this popular mobile game was first released in China, it was sold for just 1 yuan—about $0.15. But sales were disappointing. Chinese gamers, conditioned by years of piracy and free games, weren't willing to pay even that small amount.

So the developers did what many Chinese game companies do: they made the game free-to-play and added in-app purchases. Suddenly, the game started making real money. Players who wouldn't pay 1 yuan upfront were happily spending 12 yuan for a map pack, 30 yuan for a coin bundle, or 128 yuan for a special package.

The transformation was striking. By giving the game away for free, the developers lowered the barrier to entry. Once players were hooked, they were willing to spend money on in-game items. And while most players spent little or nothing, a small number spent a lot—enough to make the game far more profitable than it ever was as a paid title.

The Essence of Chinese Games: Making Money from the Few

The Ski Safari story isn't an anomaly—it's the rule. In China, the gaming business model isn't about making a little money from a lot of people. It's about making a lot of money from a few people.

1. The Whale Economy

In gaming industry jargon, these big-spending players are called "whales." They're the ones who drop thousands or even millions of yuan on a single game. In China, whales are the entire business model.

A 2025 report on China's gaming industry found that just 0.15% of players accounted for over 50% of all game revenue. That's an extraordinary concentration of spending. It means that for every 1,000 players, one or two are effectively funding the game for everyone else.

2. Designing for Whales

Chinese games are specifically designed to appeal to whales. They feature:

These systems don't just allow spending—they require it. If you want to be competitive in many Chinese online games, you have to spend money. And if you want to be at the top, you have to spend a lot.

Black Myth: Wukong: Breaking the Single-Player Curse

Then came Black Myth: Wukong. When it was released in 2024, it shattered every expectation for a Chinese single-player game. It sold over 10 million copies in its first week, generated over $700 million in revenue, and became a global phenomenon.

But Black Myth: Wukong didn't succeed because it "fixed" the Chinese market. It succeeded because it was a perfect storm of factors—timing, quality, and cultural resonance.

1. The Right Timing

By 2024, China's gaming market had changed. Piracy was less rampant than it had been in the past, and a growing middle class was willing to pay for quality games. The success of games like Genshin Impact had shown that Chinese players would pay for games that offered something special.

2. Uncompromising Quality

Black Myth: Wukong wasn't just a good Chinese game—it was a good game by global standards. Its graphics, gameplay, and storytelling were on par with the best Western and Japanese single-player games. For the first time, Chinese gamers had a single-player game that they could be proud of, one that could compete on the global stage.

3. Anti-Piracy Measures

The game also implemented strong anti-piracy measures. It used Denuvo anti-tamper technology, which made it much harder to pirate than previous Chinese games. And it was released simultaneously on Steam, a platform with strong anti-piracy protections.

4. Cultural Resonance

But perhaps most importantly, Black Myth: Wukong resonated culturally. It was based on Journey to the West, one of China's most beloved classic novels. It told a story that was deeply Chinese, but in a way that was accessible to global audiences. For Chinese gamers, it was more than just a game—it was a source of national pride.

5. The Breaking of the Curse

Black Myth: Wukong proved that a Chinese single-player game could succeed commercially. But it's important to put that success in perspective. Even with all its achievements, Black Myth: Wukong's revenue is still dwarfed by China's biggest online games. Honor of Kings, for example, generates over $2 billion in revenue every year—several times what Black Myth: Wukong made in its entire first year.

Black Myth: Wukong broke the single-player curse, but it didn't overturn the online game dominance. It showed that a single-player game could succeed in China, but it didn't change the fact that online games are still vastly more profitable.

The Evolution of China's Gaming Industry

To understand how China's gaming market got to this point, we need to look at its evolution.

1. The Early Days: Piracy and Shared Gaming

In the 1990s and early 2000s, gaming in China was mostly a shared experience. People played at internet cafes, where they could play pirated games for an hourly fee. This created a culture where gaming was social and communal, not solitary and personal.

Single-player games didn't fit this culture. They were designed to be played alone, but Chinese gamers preferred to play with friends. Online games, which emphasized social interaction and competition, were a much better fit.

2. The Rise of Free-to-Play

In the late 2000s and early 2010s, free-to-play games became dominant. Companies like Tencent and NetEase perfected the model, creating games that were free to download but made money through microtransactions.

This model was perfectly adapted to the Chinese market. It lowered the barrier to entry, allowing millions of people to play who couldn't afford to buy games. And it monetized the small number of players who were willing to spend, making the games extremely profitable.

3. The Mobile Gaming Boom

The rise of smartphones in the 2010s supercharged China's gaming industry. Mobile games were even more accessible than PC games, and they were perfectly designed for the free-to-play model. Titles like Honor of Kings and Genshin Impact became global phenomena, generating billions of dollars in revenue.

Mobile gaming also cemented the dominance of online games. Most mobile games are online, and they're designed to be played in short sessions throughout the day. This fits perfectly with the busy lives of many Chinese gamers, who often don't have time for long single-player sessions.

The Future of Chinese Gaming

Black Myth: Wukong's success raises an important question: is this the beginning of a single-player game renaissance in China? Or is it just a one-off phenomenon?

1. The Potential for More Single-Player Games

There are reasons to be optimistic. Black Myth: Wukong has shown that Chinese gamers will pay for quality single-player games. It has also inspired a new generation of Chinese game developers, who now see single-player games as a viable option.

In the years since Black Myth: Wukong's release, several other Chinese single-player games have been announced. Some are from established developers, while others are from independent studios. It's too early to say if they'll succeed, but they show that the single-player game scene in China is more alive than it's been in decades.

2. The Continuing Dominance of Online Games

But it's important to be realistic. Online games will continue to dominate China's gaming market for the foreseeable future. They're simply more profitable, and they're better adapted to the realities of the Chinese market.

Even if single-player games become more common, they'll likely remain a niche. Most Chinese gamers will continue to play online games, and most of the money will continue to come from a small number of big-spending whales.

3. The Globalization of Chinese Games

One of the most interesting trends in recent years is the globalization of Chinese games. Titles like Genshin Impact and Black Myth: Wukong have shown that Chinese games can succeed globally. This is creating new opportunities for Chinese developers, who are no longer limited to the Chinese market.

For single-player games, this is especially important. The global market for single-player games is much larger and more established than the Chinese market. By targeting global audiences, Chinese single-game developers can reduce their dependence on the Chinese market and create games that appeal to players around the world.

Conclusion: A Market in Transition

China's gaming industry is at a crossroads. For decades, it was defined by online games, piracy, and a business model that monetized a small number of big-spending players. But Black Myth: Wukong has shown that another path is possible.

Feng Ji, the man who wrote "Who Murdered Our Games?" back in 2007, is now the creator of Black Myth: Wukong. His journey—from angry critic to successful single-game developer—mirrors the evolution of China's gaming industry. The industry he criticized in 2007 still exists, but it's no longer the only option.

The story of Ski Adventure shows how the old model works. By giving the game away for free and monetizing through in-app purchases, the developers turned a commercial failure into a success. It's a reminder of why online games dominated China's market for so long.

But Black Myth: Wukong shows that things can change. It's not just a game—it's a symbol of what's possible when Chinese developers focus on quality, cultural resonance, and creating games that players actually want to play.

China's gaming industry will never be exactly like the Western market. The economic realities, the cultural preferences, and the business models are too different. But it doesn't have to be. Black Myth: Wukong has shown that China can have its own successful gaming industry—one that combines the best of Chinese culture with global standards of quality.

As we look to the future, it's clear that China's gaming industry is in transition. Online games will continue to dominate, but single-player games are no longer dead. And as Chinese games become more global, they'll shape the future of gaming not just in China, but around the world.

The question isn't whether single-player games will replace online games in China. They won't. The question is whether they can coexist—and whether Chinese developers can create games that succeed both commercially and artistically, both in China and around the world. Thanks to Black Myth: Wukong, we now know the answer is yes.