Chapter 5 Chapter Four Disillusionment (1996-1999)

·In 1996, the world's first large-scale graphic online game "Meridian 59" came out. ·In 1998, Beijing Leading Software Co., Ltd., established with an investment of 4 million, withdrew from the game market, and domestic games fell into a trough. ·In 1999, China's first graphic online game "King of Kings" came out in Taiwan. In the fifth wave of mergers, American companies set off the fifth wave of mergers. At the end of the 1990s, the American game industry, which was in its development period, was also involved in this tide.Large companies acquire small companies, large companies merge with large companies, and large companies are acquired by larger companies..."recruitment" and "marriage" incidents occur frequently.

In 1999 alone, there were four major mergers and acquisitions in the US game industry: First, a French company acquired GT Interactive for US$135 million, acquiring all five major studios under GT.The second is that the French company Titus acquired 34% of Interplay's shares, and in 2001 controlled 51.53% of the company's shares by exchanging shares.The third is that Hasbro Interactive acquired Wizards of the Coast for US$325 million and acquired the copyrights of "Dungeons and Dragons" and "Magic: The Gathering". The next year, Hasbro Interactive was acquired by Infogrames.Fourth, Vivendi of France acquired Cendent Software of the United States for US$700 million. Cendent is the parent company of Blizzard.

It now appears that the frequent mergers and reorganizations at this stage are actually fierce shocks before the US game industry is finalized.After that, the monopoly of large companies on the industry was further strengthened, the living space of small and medium-sized companies was squeezed, and publishers replaced developers as the central link of the industry chain.It was also in 1999 that Electronic Arts of the United States established its dominance, and its operating income exceeded the 1 billion mark that year, while the annual sales revenue of the British game industry was only 800 million US dollars.

Although mergers are conducive to the enhancement of the overall strength of the industry, they will have many negative effects on creative activities such as game development.The most prominent point is the loss of vitality. The power of life and death of the game is held in the hands of a few large companies with strong funds and smooth channels.Computer games at this stage have changed from artworks in garages to giant Hollywood-style monsters. Each work requires a lot of investment, and the consumption of development resources is astonishingly fast. Few developers can survive the fierce competition.

On the other hand, mergers have also brought development opportunities for some well-known developers, enabling them to have sufficient resources to develop and promote some epoch-making works. In the fall of 2010, "Meridian 59", independently developed by Archetype, came out. This should be the first large-scale graphics online game in the history of games.But the reality is that the title of "No. 1 Online Game" was taken away by "Online Genesis" launched by Origin a year later, and "Meridian 59" was quickly forgotten by the market.Although this aspect is inseparable from the quality of the game, on the other hand, it is also related to the abundant funds and strong marketing power of Electronic Arts, which acquired Origin.Compared with stand-alone games, the successful promotion and operation of online games requires a higher budget and stronger market operation capabilities, especially when there is no precedent.

The success of "Online Genesis" opened up the online game market in the United States. After that, more and more professional game companies began to get involved in the research and development of online games, such as Sony's "Ever Quest" and Microsoft's "Call of Elsaron". and Mythic's The Dark Ages of King Arthur. While the computer game industry in the United States continued to grow through mergers, the computer game industry in Taiwan, China fell to the bottom after the glory of "Legend of Sword and Fairy". Homicide or Suicide Since 2010, the "Madman Creation Group" has declined due to internal conflicts, and the veterans have left one after another.

The decline of Daewoo is not accidental. In addition to internal conflicts, changes in the general environment of Taiwan's game industry are the main reasons for this result. In May 1995, a reporter from Japan's "Login" magazine concluded after interviewing several Taiwanese game developers: "Although Taiwan is currently dominated by PC gamers of low age, it is undeniable that its growth is rapid and amazing. Yes, it will have a great impact on Japan... The most frightening thing is Taiwan's geographical location. Due to Taiwan's strong international competitiveness and more contacts with the outside world, its game software will enter South Korea, the United States, and even Europe and the world. The market is not difficult. In addition, Taiwan has begun to invest a lot of money in large-scale game development, which can not help but make Japan restless. Although Japan's software is still leading today, it is unknown what will happen in the future."

In 2010, a Japanese man named Takahashi went to China Taiwan, China Hong Kong and South Korea and other major Asian game markets to investigate and wrote a series of reports. He made the same evaluation of the Taiwan game market: "In recent years, Taiwan's software has developed rapidly. Fast, although immature, but due to the continuous improvement of the level, it is also a great threat to Japanese game software... The world game industry must pay close attention to Taiwan's trends, and it will be in the United States, Europe and Asian markets including Japan. occupy an important position.”

The two Japanese did not expect that Taiwan's local game industry would fall apart within a few years, let alone that this was caused by the influx of Japanese games. In 2000, many game companies in Taiwan, such as Bird of Paradise Information, Huayi International and Happy Box, etc., began to engage in the transplantation, Sinicization and introduction of Japanese PC-98 games, most of which were H-Game (adult games). A PC-98 craze quickly formed in Taiwan's game market. Under the lure of profits, some established companies including Zhiguan also began to get involved in H-Game. The proliferation of PC-98 games, on the one hand, caused computer games to be misunderstood by the public and criticized by public opinion just like arcade games more than ten years ago; The vitality of Taiwan's local game industry, which has only grown in recent years, has been severely damaged.Then Taiwan's game industry collapsed, and all kinds of studios that had sprung up like mushrooms in the past few years all went bankrupt, and original works entered the Great Depression period.

In fact, Mr. Takahashi has seen some clues. He mentioned in the report: On the one hand, although Taiwan has some excellent game works, overall, the overall quality of Taiwanese games is not very high. The sales volume of Japanese PC-98 games is much higher than that of Taiwan's local games; on the other hand, there are misunderstandings when Taiwan introduces Japanese games, and too many H-Games are introduced, so that many Taiwanese players think that Japanese games are such games. Type of. He said: "Actually, the problem lies with the Taiwanese software companies that have contracted with Japan to transplant Japanese games. In the future, shouldn't it be enough to import and transplant more ordinary games from Japan? The Japanese side is also very concerned about this issue." Confused. I did some research on Japanese games released in Taiwan, and found that many games that cannot be released in Japan have been imported and transplanted in Taiwan.”

After saving Jinshan's life for a year, WPS was defeated in the face of Word's offensive.Microsoft said to Qiu Bojun earnestly: "Work hard, you will have a future with us." Qiu Bojun rejected this precious food. Qiu Bojun pinned his hope of fighting back against Microsoft on WPS 97, but the project was delayed again and again, and there were problems with funds and confidence. "The second half of 1996 was the most difficult time. Funds began to be tight, confidence was lacking, and the future felt bleak." So Qiu Bojun sold the villa for 2 million yuan to maintain the research and development of WPS 97, " The deeds of selling a house to make software" became a good story for a while. But selling the house can only solve a temporary emergency. In order to support the company, Qiu Bojun began to look for other outlets, including games. "At that time, we vigorously promoted game software and tested other markets, but we estimated that the game would not make much money. Now, I still think that making games does not make money. Foreign games make money because their main markets are abroad, and there is nothing in China. Invest so you can make money.” In fact, the game still made some money for Jinshan, although Qiu Bojun thought it was just "a drop in the bucket". In January 2010, the debut work "Apocalypse of Zhongguancun" by Xishanju Creation Studio was released. In April 1996, the game "China Civil Aviation" planned and developed by Qiu Bojun was completed in only three months and launched to the market. In May 2010, the famous work of Xishanju was put into research and development. In March 2010, half a year before the release of WPS 97, it came out.The development cost of the game is very low. The underlying technology of the game is based on an immature engine developed by Qiu Xin. The whole project took only ten months. Calculated, the development cost of the game is only 300,000 yuan, plus 800,000 yuan in management and marketing expenses, the total expenditure is about 1.1 million yuan.Everyone's initial optimistic estimate of sales was 10,000 sets, but they didn't expect the game to become a hit, and eventually sold 10,000 sets. If it wasn't for the fact that it was out of stock in the middle, it would not be a problem to break through 30,000 sets. We can calculate that the price is 128 yuan, after deducting the expenses of 1.1 million yuan and the profit of the channel, the profit brought to Jinshan is at least 1 million yuan.Therefore, some old employees of Xishanju believed that the game saved Jinshan's life. The Yuan theory year is the leading development period. Although the sales of "Guandu" in the domestic market are not satisfactory, it has recovered 70,000 US dollars in royalties from overseas.In addition to independent research and development, Qianleader is also actively seeking to represent excellent foreign games. At the end of 1996, the leader introduced "Command and Conquer" and "Legend of Kailandia", among which "Command and Conquer" Set a record of 10,000 sets shipped within a week and all payments were settled. 2010 is the leading expansion period. The "Red Cliff", which was launched in that year, was bundled with Lenovo computers, and took the lead in breaking through the 100,000 sets of domestic game software sales. Leading software is seen as a model for successfully attracting venture capital. At the beginning of 1998, Bian Xiaochun made an analogy when talking about his understanding of venture capital: "If you have 50 yuan in your hand, how should you manage it? The usual way is to invest in the market, get 10 yuan profit, and then use 60 yuan to continue to operate. My approach is to only take out 30 yuan to invest in one major market, and start two new projects with the other two 10 yuan, and then bundle these 3 projects together to find investors. 200 yuan investment to develop these 3 projects.” However, only half a year later, the leading company announced its withdrawal from the game market.A year later, Bian Xiaochun reflected on his "50 yuan theory": "I was indeed wrong, because this concept did not make the leading company out of crisis. So what's wrong?My current understanding is: if you lose all the 30 yuan, no one will invest in your three projects, although these three projects may indeed be good projects in the future.In other words, as a venture capital enterprise, although it must and can only obtain the impetus for rapid development from the capital market; however, only the product market is the foundation of the enterprise. " Breaking the halberd and sinking into the sand "Chaos first opened, and the game came in. At that time, how many heroes and heroes galloped in the wilderness of the desert, and countless knights ran across the world with swords and halberds. Virtual life has everything that one expects. If you are so proud, what can you ask for? ? "After several trips, my eyes gradually opened. Looking at the Three Kingdoms and the Demon Realm, or the East, or the West, and the majestic Chinese Heaven, there is no long-term possession. Thousands of descendants of Yan and Huang have to devote themselves to foreign affairs, or linger in the arms of Oriental beauties, or Indulging in Western European Might and Magic... "Finally one day, a group of people with lofty ideals yelled at the case and rose up! "Jinshan was the first to launch an attack in Zhongguancun, and Jinpan counterattacked against the Opium War; With the life and death talisman, Jinshan launched a mine warfare! "When the halberd falls into the sand, the soldiers of the country shed tears; when the city is plundered, the red hair raises the sword. After several fights, the scene is bleak. The twilight is vast, tragic and desolate. A thunderous thunder resounds in all directions. Looking back suddenly, there is a golden mountain! The swordsman comes back, the ambition If you don't get paid, you won't return; the hero is here, would you be willing to hold the heaven and slay the dragon to slay the wolf?" This passage written on Kingsoft’s homepage in 2010 vividly describes the process of the original game in mainland China from scratch and then died halfway, and this process took only three years. A few years ago, there were only five relatively standard game R&D companies in China: Jinpan Electronics, Xishanju, Leading Software, Tengtu Electronics, and Shangyang Electronics, as well as production teams of some foreign-funded companies in mainland China, such as Creative Yingxiang under Lidi Company, Red Ant, a subsidiary of Beijing Zhiguan Company, etc. 2010 was the golden age of the mainland game market. At that time, a game of above-average quality could sell 10,000 sets, and one with outstanding quality could sell more than 50,000 sets.So since 1997, a large number of well-known or unknown companies have poured into the game market, including publishing houses, hardware manufacturers, software manufacturers, and many interest groups that do not have R&D capabilities at all.Rolling up their sleeves, they went forward one after another, setting off a wave of stand-alone game fever in China, and they are likely to catch up with Taiwan and look at the United States and Japan.It is a pity that these fast-moving entrepreneurs, whether investors, operators or developers, lack a basic understanding of the market environment and game development, which paved the way for the bursting of the bubble. In the second half of the year, the domestic game environment took a sharp turn for the worse, and a large number of small and medium-sized companies even collapsed before their products came out.This year, the number of exiters far exceeded the number of entrants, such as Genesis, Jiehong Software, Master Computer, Zhiqun Software, Huiying Software, Daheng CD-ROM, Wansen Electronics, Hongda Electronics, Admiralty Electronics, Raytheon More than a dozen companies, such as Information and Xionglong Company, withdrew one after another, and only a few entered, such as Kingstar, Kudingxiang, Jinzhita, Pangu, and Polaris.At the bottom of the industry, there are many more production groups that have no financial support in the first place and are struggling. In 2019, with the withdrawal of Jinpan Electronics, Tengtu Electronics and leading software, domestic games were all red.Bian Xiaochun could not restrain his grief: "This team is still broken up. The largest game software development team in China. Raise your hands and ask the heavens! Does this mean that the Chinese market does not need us?" This team?! My heart is already broken. It doesn’t matter where I go. Is it cruel? This is reality!” Looking for a scapegoat Many people marked the turning point of domestic games from prosperity to decline on April 27, 1997. On this day, Shangyang Electronics launched "Blood Lion". The false marketing promotion of "Blood Lion" is in great contrast with the poor product quality, which has caused many players to distrust domestic games.Yao Zhen, the former general manager of Creative Eagle, mentioned in 1999 when explaining why the sales were not good: “On the one hand, this is because the market is not able to bear it enough; During that period, I didn’t watch domestic games at all.” Now it seems that it is a bit extreme to attribute the market downturn to the failure of a certain product.But in fact, for a long time afterwards, "Blood Lion" was indeed used by many gamers as an excuse for product failure, "Blood Lion" The negative impact on the market has been exaggerated. What is the reason why the mainland's original games were defeated just after they started?Five years later, when we look at the collapse of Shanghai Fengyun Interactive, we will find that its cause of death is so similar to that of many stand-alone game developers back then. Li Lanyun, the chief planner of Xishanju, mentioned in an article written to Southern Weekly in 1998: "The news that foreign game companies are making a lot of money will gradually spread in China. , It is estimated that some people who have money and have nowhere to spend it carelessly throw a handful of funds into the black hole of game production.” The capital threshold for domestic game development is not high, and many production teams lacking experience and necessary resources join in under the drive of profit. If a product cannot be launched smoothly, it will face the danger of dissolution.R&D companies supported by external funds, because the investors are too optimistic about the future of the market and lack a clear understanding of the risks of game R&D, they only invest blindly with short-term speculative ideas, and if there are some changes in the project or environment, they will withdraw quickly. .Even if the investor has enough patience and the R&D personnel have sufficient technical strength, the lack of management experience and marketing ability will often become a fatal bottleneck. Of course, if the market is large enough, the above disadvantages may not be so fatal.So what was the state of the Chinese game market at that time? 2010 was the year when piracy spread like wildfire in China. The variety and quantity of pirated software increased significantly, covering more and more areas, and the price dropped to about 10 to 15 yuan.Although the government has stepped up its crackdown, piracy is still deeply rooted in the hearts of the people in the shortest possible time, and the sales of genuine software have been greatly impacted. At the same time, overseas (including Hong Kong and Taiwan) games also flooded in this year.As the local market was captured by PC-98 games, game manufacturers from Taiwan moved to the mainland one after another, setting up R&D teams and sales teams in the mainland, such as Spectrum Information, Third Wave, Lidi, Jingtian Software, etc.Its purpose has changed from reducing R&D costs initially to directly entering the mainland game market.Taking Zhiguan as an example, after the establishment of the Guangzhou branch in 1992, Zhiguan’s development strategy in the mainland for the first four years was mainly based on research and development; R&D turns to the market. In 2010, Electronic Arts of the United States and Ubisoft of France set up branches in Beijing and Shanghai respectively, using them as outposts to introduce their products to the mainland.At the same time, professional game agency companies represented by Ogilvy Electronics and Xintiandi were established successively, and high-quality European and American games began to flow into the domestic market.According to statistics, in the mainland computer game market in 1998, domestic games accounted for only 6% of the total number of games listed, and the rest were imported products. According to the sales figures of Lianbang Software, in 1998, the mainland's legitimate computer game market was below 80 million RMB, most of which were taken away by foreign companies.Calculated in this way, even if we control the R&D expenses and management and marketing expenses of a game within 500,000 yuan, the market at that time could only support less than ten local game R&D companies. Facts have proved this point. Among the games released in 1998, 75% of the sales were below 5,000 sets, and the profit and loss point of self-developed games was around 10,000 sets.In the case of limited funds, the company was unable to sustain after one or two products lost money, so there was a comprehensive retreat in 1998. Piracy of genuine products Many people still clearly remember October 21, 1999. On that day, Qiu Bojun and Lei Jun jointly announced the "Red Genuine Storm" plan. The reduction from the original 168 yuan to 28 yuan caused an uproar in the industry.Although the sales volume of software such as "Kingsoft PowerWord" has exceeded 10,000 sets, the profit of each set is only about 2 yuan. In fact, as early as a year ago, "Red Storm" had already set off in the game software market. In March 1998, the leading company launched "Water Margin: Juyi Chapter" at a price of 48 yuan. In June 1998, Beijing Zhiguan launched it to the market at an ultra-low price of 100 yuan. At the beginning of building channels in mainland China, Zhiguan determined the development policy as "low-price, large-scale marketing strategy". Genuine product piracy" method, through streamlining product packaging, to control the price at a low level.Wang Junbo copied the "$3" strategy he used in Taiwan when he fought the country back then.It is under the guidance of this strategy that 19 yuan was born.It was also from this year that most domestic game software dropped to less than 100 yuan. If Jinshan's "red storm" is a kind of suicide, then Zhiguan's low price strategy is a kind of colonial plunder.Jinshan also has to pay the price for its own "red storm", while Zhiguan does not need to care whether the mainland's original game industry will collapse because it has sufficient product lines, because it has a strong presence in South Korea, Malaysia, Japan and the United States. Open up your own market. Although the low-price strategy has brought benefits to consumers, it has seriously disrupted the order of the industry.Players' psychological bottom line on the price of genuine games has been completely broken, and the domestic game industry has thus entered an era of meager profits. 1997 The price of "Swordsman Love 2" in 2000 was only 38 yuan. Although the latter sold more than 100,000 sets, the profit may not be much higher than the former. Under the pressure of pirated and genuine products, more and more companies regard reducing R&D costs as their primary goal, prior to product quality, which makes the development of enterprises enter a vicious circle. After being hit hard by this blow, the domestic games that were in a low ebb completely fell to the bottom.The entire market has undergone a major reshuffle, and a large number of small and medium-sized game developers have been purged out. Game manufacturers that are still struggling have also embarked on the path of emphasizing agency over R&D, and emphasizing quantity over quality. One day in the year of playing mud, Lei Jun started dialing at 7 o'clock in the morning without washing his face. After dialing for half an hour, he finally got on the stop. Lei Jun took down the letter and quickly disconnected.After reading the letter and writing a lot of replies, Lei Jun went to dial again.After dialing, first write a letter, and then upload the reply I wrote, and then immediately disconnect, so that the netizens who dialed desperately behind have a chance to get on the site. This is the Internet of that era, slow and expensive.In the eyes of people at that time, graphic online games were still out of reach, and text MUDs were the only entertainment for netizens.In that year, domestic stand-alone games were still just starting, and a simplified Chinese version of a Taiwanese MUD—"New Oriental Story 2" (ES2) had already been circulated on the network of the Chinese Academy of Sciences.In the same year, "Xia Ke Xing" developed by Fang Zhouzi and others, and later "Journey to the West" and "Fengyun" And other text MUDs are all developed on the basis of ES2. The original Chinese MUD servers were all set up abroad. For example, the server set up in the United States, the domestic connection speed is very slow. In January 1997, a group of MUD enthusiasts in Hainan developed "Sword of Books" with the background of Jin Yong's martial arts novels and ES2 as the bottom layer of the system. The server of "Book Sword" is set up by Hainan Jinxinhua Network Company, which is the first MUD game whose server is set up in China. In 2008, stand-alone games were in trouble, but MUD games were extremely popular. A number of MUD games such as "Reappearance of the Sunset", "Blue Sea and Silver Sand", "Ride the World", and so on appeared in China. Most of these games are modified on the basis of ES2 and ES2, and some are simply copied directly. Therefore, the quality and playability of the games are uneven. It ended in a hurry. Many technologies of graphic online games are developed on the basis of text MUD. For example, Taiwan Leijue's "King of Kings" and Beijing Xia Kexing Company's "Xia Ke Tian Xia" are both evolved from the text MUD of the same name. This has also caused many disputes, such as the dispute between Fang Zhouzi and Dong Xiaoyang on copyright issues. Lei Jue's "King of Kings" is the first graphic online game in China. Its text MUD of the same name was opened at the end of December 1996. The developer is a husband and wife doctoral student at the Institute of Materials Science of Tsinghua University in Taiwan - Chen Guangming and Huang Yuzhen, they met and fell in love because of the Internet, and embarked on the road of starting a business together because of online games. The development experience of "King of Kings" is quite tortuous. The shortage of developers' time and money has always been the biggest factor restricting its growth in the early days. In 1997, Chen Guangming won a computer sponsored by Huacai Software, and the number of online users exceeded 600.In December of the same year, the "Graphical Multi-User Network Space" proposal written by Chen Guangming and Huang Yuzhen participated in the "Creative and Innovative Software Concept Competition" jointly organized by the Software Innovation Incubation Center of Sun Yat-sen University and the Acer Foundation. Hundreds of entries were selected Stand out and win the "Excellent Work Award".This made Chen Guangming full of confidence in the prospect of graphical online games in the future software market. In 2010, Chen Guangming and Huang Yuzhen completed the MUD architecture of the distributed system, making "King of Kings" The number of online users exceeded 1,000.In the same year, CLS decided to invest in the development camp of MUD graphics, and the first R&D team specializing in the development of online games - "Game Factory" was officially established. In 2010, the graphics MUD of "King of Kings" was successfully developed.In April of the same year, Leijue Information Co., Ltd. was formally established, becoming the first online game research and development company in China to apply graphical MUD technology to the commercial consumer market.