Tang Jun Said: Wall Street Underestimated China'S Online Games Industry.

China's online gaming stocks have been caught up in Wall Street, and they seem to have been "abandoned" in the near future.

For the recent weak trend of China's online gaming stocks listed on Nasdaq, Tang Jun, a senior executive, told reporters yesterday that "the reaction of Wall Street is a bit extreme, but this is also a warning to online games companies. In a relatively turbulent stock market, every enterprise should make good commitments and continuously improve its performance."

Tang Jun pointed out that "recently, the global stock market has been adjusted, many stocks have been hit, and those who failed to achieve the anticipated performance of Wall Street have been hit the most.

Some of the recent Chinese concept shares have revealed the quarterly report, which has not reached the top end of Wall Street, and the market will be punitive on these stocks with more severe means.

However, the reaction of Wall Street is a bit extreme.

The performance of the stock market has been relatively stable, and some new online listings have become the worst hit areas. Tang Jun analysis shows that "the relative stability of the grand stock price is because Wall Street is not only optimistic about the performance of Shanda, but also optimistic about the long-term strategy."

Grand operation is not a two game, but there are more than 20 games running at the same time.

It is very difficult for 20 games to be successful, but it is even harder to be successful. Wall Street should be very confident about Shanda.

As for the new subprime stocks, many of them are studio companies that only make one or two games. At the beginning of the listing, Wall Street gave them high price earnings ratios, but these companies did not meet the requirements of Wall Street.

So, if we fail to meet the high-end projections set by the Wall Street, the result will be very unfortunate.

At the same time, the number of investment banks has been given a grand "buy" rating.

A few days ago, Shanda announced that it had reached an agreement with NCSoft, a South Korean game operator, to acquire the exclusive right to operate the AION in mainland China.

In addition, Shanda will invest strategically in NCsoft NCsoft China, a subsidiary of China, with a stake of 30%.

Pali Research, a research firm, said in its report that the quality of the Shanda product line will be improved after the authorization of the eternal tower.

In the past two years, people often criticize Shanda for not having the ability to authorize or develop a heavyweight game. In fact, Shanda has fully demonstrated that even without heavy weight games, the company can achieve steady growth by running an excellent platform.

In fact, Shanda just wants to be a "online game platform operator".

In an interview with reporters, Tang Jun made a description of the future direction of the grand future: "we hope that in 35 years, we can provide a platform for all online game manufacturers (including future network company manufacturers), our billing system, our technical support system, our security system, our marketing system, our Internet cafe system, our customer service system. All these will not only be provided to ourselves, but also to all the online game companies, to all Internet Co in China."

Wall Street has underestimated China's online game industry: Shanghai Securities Journal: compared to search, B2B and portal advertising, Wall Street's net earnings ratio to the online games industry is generally less than 20 times. Is this valuation level appropriate?

Tang Jun: Wall Street misunderstands China's online games industry as a content industry.

The benefits of the content industry are good and bad. Just like making movies, no one can predict the box office of the next movie.

This means that Wall Street has not yet understood our online game business model, so the price earnings ratio is relatively low, but this does not match the growth rate of China's online gaming companies.

As for the appropriate price earnings ratio, we should consider from several aspects: the first is the stability of the industry; the second is the growth rate of the industry in the future.

The stability of China's Internet industry needs no further demonstration.

Meanwhile, in the next five years, the growth rate of China's online games industry will remain above 35%.

Shanghai Securities Daily: since the online game industry is not a "good time and bad content industry", what is its stability?

Tang Jun: if a company runs only one or two games, the situation will be good and bad.

But for example, we operate more than 20 games on the operation platform. In fact, one of them is enough to support the grand development.

This is a grand strategy. We hope to solve the concerns of Wall Street on the company's future development in this way.

Shanghai Securities News: Recently, online games enterprises have concentrated on IPO. What is the reason behind this?

Will the tide of listing continue?

Tang Jun: IPO is the phenomenon that the online games industry has developed to the present stage.

Shanda, NetEase and other leading companies have jointly made the cake of the online games industry. Many people want to share this cake.

They entered the industry three years ago, and spent two or three years to make their enterprises meet the standards of listing, thus forming the second wave of online games listing.

I predict that in the next three to five years, ten to twenty online games companies will also be listed successfully.

Shanghai Securities News: now, Shanda, NetEase, giant and other large companies have accounted for more than 80% of the market share, while most of the rest of the game products can only struggle on the "food and clothing line", does this mean that the industry consolidation is about to start?

Tang Jun: online games industry is inevitable.

Online games are relatively low cost industries, so people will make large-scale acquisitions through financing.

But at the same time, online games are also a creative industry.

For creative industries, no enterprise can buy all the creativity in the world.

Every year there will be new ideas, which is the charm of the industry.