China's games market hit $51.8B in 2025 — but the export numbers are the real story. Adam Smart and John Wright on ARPU, casual 4X, 996, Steam bans and why China now out-executes the West.

China's games market hit $51.8B in 2025 and is forecast to pass $59B by 2030. But the domestic number is only half the story: Chinese publishers now account for 35% of all user acquisition spend outside China, and Chinese-developed games generated $20.4B overseas last year, with H1 2026 alone up 30% year on year.

In episode 3, Adam Smart and John Wright work through the Niko Partners data and disagree about whether China and the US are really at revenue parity (John isn't buying it). From there: why genre mix and ARPU explain most of the gap, the 10–15 year head start China has on free-to-play, how a Steam ban and a lot of VPNs distort the data everyone is quoting, WeChat instant games at roughly 20% of the domestic market, the casual 4X onboarding hook that finally brought CPIs down, and Tencent telling two studios to build the same game with winner takes all.

Also in this one: why competition breeds excellence and what that means for Turkey, the 996 work ethic conversation and where it stops being reasonable, what the Nordics still do better than anyone, and what Japanese whisky has to do with the whole thing.

Chapters

(00:00) Cold open: are we merging into one person?
(01:24) Why China, and what the Niko Partners numbers say
(02:53) $51.8B, 769M players, $70+ ARPU
(03:06) China vs the US: is it really parity?
(03:46) Chinese publishers = 35% of UA spend outside China
(05:16) Why China's scale shouldn't surprise anyone
(06:25) Genre mix: hardcore vs casual, and what it does to ARPU
(07:36) Steam is banned — VPNs and the data blind spot
(08:56) Web stores and DTC: China got there years ago
(09:13) How Western studios actually enter China
(11:35) WeChat instant games: around 20% of the market
(12:15) Trying to pay cash for a curry in Beijing
(13:07) The export story: $20.4B overseas, H1 2026 up 30%
(14:12) Strategy is half of China's overseas top-100 revenue
(14:36) Honor of Kings is the biggest game in the world
(15:16) Competition breeds excellence — and Turkey is next (16:26) Casual 4X: how they solved the CPI problem
(17:48) 42% of global PC revenue, and the free-to-play head start
(19:42) Live ops, gacha and meta mini-games
(20:04) McDonald's campaigns: games as mainstream culture
(21:14) 996 and the work ethic conversation
(21:52) Tencent: two studios, same game, winner takes all
(23:39) Nordics creativity vs Chinese execution
(24:15) Are Chinese companies better at the business of games?
(25:27) "We spent 20 years cracking China. China cracked us."
(26:06) Japanese whisky, cricket and tiddlywinks
(26:31) Wrap, and the TikTok episode we owe you

Mentioned in this episode

• Niko Partners, China games market forecast
• AppsFlyer, State of Gaming
• Newzoo, global PC games revenue

Adam and John Wright compare the current realities of mobile and Steam game publishing, with a focus on why the two markets demand very different strategies. They also dig into the biggest blind spot in current industry forecasts: direct-to-consumer revenue, which may be reshaping how investors and analysts read the gaming market.Speakers covered

• John Wright — Explains how mobile publishing used to be more predictable, why that changed after ATT, and why Steam is not an easier substitute
• Adam — Pushes on the market-size comparison, questions the shift from mobile to Steam, and raises concerns about missing revenue in industry forecasts

Key topics

• Mobile and Steam are not interchangeable markets, even if they can look similar from the outside
• Mobile publishing used to be driven by clearer KPIs, organic lift, and more calculable UA unit economics
• Post-ATT mobile became harder to forecast, with fewer new breakout games and larger drop-off points in the funnel
• Older games now make up a larger share of mobile revenue
• More of the new game pipeline appears to be coming from APAC rather than the West
• Steam is a different business, with premium pricing, heavier reliance on influencers, and far less visibility into its algorithm
• Hoping for a Steam breakout is not a strategy because success there is less predictable and depends heavily on community momentum
• Direct-to-consumer revenue may be missing from current market models and forecasts
• Negative industry sentiment may partly result from data tools failing to capture DTC performance

• • Analysts and investors may be making decisions without full visibility into where gaming revenue comes from

Welcome to episode 1 of Smart and Right, a weekly, no-nonsense catch-up on everything happening in mobile and console gaming, hosted by Adam Smart (AppsFlyer) and John Wright (Turborilla).
In this launch episode, we break down our biggest conversational takeaways from Gamescom 2026:

AI adoption has exploded, from supporting single departments a year ago to running across entire game studios today. But it's not all upside: we talk real stories of runaway token costs (one employee burned $30k in a month) and why "head of AI operations" might be gaming's next big hire.

Rising mobile CPIs are pushing studios toward web-to-app strategies to cut user acquisition costs, is it actually working?

AI is collapsing prototyping timelines from months down to weeks, letting studios take more shots on goal with less spend.

The slow death of physical media, PlayStation dropping discs, Switch 2's move to cartridge codes, and what the industry loses as a generation raised on Roblox and in-app purchases takes over as gaming's biggest spenders.

China's growing footprint at Gamescom, with major studios like miHoYo targeting female and casual audiences while Western studios stay risk-averse.

If you work in gaming, mobile marketing, or just want an honest, unfiltered take on where the industry is heading, subscribe new episodes every week.