Niko has been following China's growing fascination with social networking games, and the large audience sizes for the leading social networking site (SNS). Venture Beat's article about farming games shows that China's SNS game market could easily be larger than the US market already, but if not yet then it will be very soon. The question remains how many of the SNS gamers are additional to the existing traditional gamer user base, and how much money is being generated in online game service revenue by these games. Since all of the games are free now, they do not add to the Niko revenue estimate ($3.65 B for 2009), but in the future with all of those users it may be possible to convert to a different business model for fee generation and then help drive some of the forecasted growth in the market over the next few years.

Initial reports indicate that the reception for Apple's iPhone in China has not been as hot as anticipated, but Niko will follow official numbers as they are posted to see whether or not those initial reports are valid. In friendly conversations with people in Shanghai and Beijing we have learned that people are eager for smart phones, and it remains to be seen if the iPhone is at the right price and service offering for their desires.

NetEase and Blizzard China continue to forge ahead with the commercial operations of World of Warcraft, and their role as the pawn in the battle between the Ministry of Culture and GAPP has not held the companies back from pursuing their strategy to serve Chinese gamers with online game operations. Niko has read reports that state that the Ministry of Culture is reviewing WoW's second expansion, Wrath of the Lich King, but until the battle between the two agencies is won we will not know whether or not approval for that game can be granted by the MOC.