Chinese tech conglomerate Tencent Holdings Ltd. on Friday officially released its highly awaited party game ‘DreamStar,’ which is expected to be a strong competition for NetEase Inc.’s ‘Egg Party.’
DreamStar, which involves players racing through an obstacle course as cartoon characters, is considered the Shenzhen-based firm’s answer to the significantly popular game of its domestic rival.
NetEase introduced Egg Party in May 2022, and it has since gained considerable traction to help increase the shares in the Hangzhou-based internet company by over 40% this year.
Since its launch, the app has remained among the top downloaded games in China, with its ‘party-royale’ concept drawing in casual players, particularly young women. The game involves users competing in various obstacle courses and minigames as egg-like characters.
Tencent Introducing New Competition and Growth in Gaming
Analysts see the release of DreamStar impacting NetEase’s revenue by 2% to 3%. They have also cut their estimates for the company’s revenue for the next two quarters by 4% and 5%, respectively.
Egg Party is expected to generate annual revenue between CN¥7 billion ($980 million) and CN¥8 billion ($1.1 million) for 2023. As for DreamStar, the app is forecast to bring in between CN¥5 billion and CN¥6 billion in its first year.
Vice President at a US-based gaming consultancy firm, Xiaofeng Zeng, stated that party games as a genre are thriving in China, and with DreamStar entering the picture, the overall addressable market should find growth instead of only consuming Egg Party’s user base.
Egg Party currently caters to more than 100 million monthly active users.
NetEase’s market cap hit $67 billion on Friday after taking the fourth spot from Chinese food delivery giant Meituan in the country’s largest internet company category.
Still, Tencent continues to be China’s largest internet company. It is also recognized as the world’s biggest video games provider, which runs WeChat, the country’s leading social media platform.
Tencent has been exploring new successful game prospects as competition in the industry grew fiercer. Earlier in December, the company dropped a trailer for its new console open-world title, ‘Last Sentinel,’ which is set to be its most ambitious effort at a big-budget console game.
