mesbooks Chapter 249 Foreign Capital Entry
Chapter 249 Foreign Capital Entry
Lu Ran's premonition soon became a reality.
A week later, two pieces of news arrived almost simultaneously—
Article 1: Nintendo, Japan's largest game company, announced the establishment of a "China Market Strategy Department" to specifically study the current situation and opportunities in the Chinese game market. Industry interpretation: Nintendo may be getting directly involved.
Article 2: A senior vice president from Electronic Arts (EA) of the United States quietly arrived in Shanghai. His itinerary was kept secret, but it was said that he was there to explore cooperation opportunities.
"President Lu," Zhou Mingzhe placed the two messages in front of Lu Ran, "take a look at this."
Lu Ran glanced at it, his expression calm: "As expected."
"As expected?" Zhou Mingzhe asked, somewhat surprised. "Aren't you nervous?"
"What's there to be nervous about?" Lu Ran laughed. "If someone wants to come, can you stop them? You can't. Since you can't stop them, then think about how to deal with it."
He picked up the news article about the EA vice president's visit and read it carefully.
"What's this vice president's name?"
"His name is David Morrison, the number two person at EA in charge of Asia-Pacific business," Zhou Mingzhe said. "He is said to be a powerful figure within EA, having spearheaded the release of several blockbuster projects."
Lu Ran nodded: "He didn't come to China for tourism. He's either looking for an agent, a partner, or—he's here to probe the situation."
"Testing the waters?"
"Right." Lu Ran stood up and walked to the whiteboard. "Think about it, what level of company is EA? It's one of the top three game giants in the world. Would they not care about the emerging market of China? They didn't care before because China's game industry was too weak; they could only import, not export. But it's different now."
"Two Chinese-made games are currently popular overseas. Although their scale is still smaller than some of their blockbuster titles, what does this show? It shows that Chinese game companies are now capable of creating global products. That's what they're really worried about."
Zhou Mingzhe pondered, "So they came to test our strengths and weaknesses?"
"More than that." Lu Ran shook his head. "They came to play chess."
"Playing chess?"
"That's right." Lu Ran picked up a marker and drew a few circles on the whiteboard. "The Chinese market used to be a blue ocean, where anyone could make a fortune. But now, Tencent, Tutu, and those mid-sized companies have almost completely divided up the market. Foreign giants that want to enter either have to cooperate with local companies or try to break in on their own."
"It's too costly for them to try to break into the market on their own. They're unfamiliar with China's policies, user habits, and channel rules. So the safest approach is to partner with a local company—through distribution, joint ventures, or strategic investment; there are many possible forms."
"And what about us?" Zhou Mingzhe asked. "If they approach us for cooperation, would we agree?"
Lu Ran thought for a moment, but did not answer immediately.
This is a question that definitely needs to be thought about carefully.
Cooperation means leveraging external resources, quickly opening up overseas markets, and learning advanced technologies and management experience. But what are the costs? It means giving up some benefits, being potentially controlled by the other party, and possibly being turned on one day.
Non-cooperation means having to slowly grind things down on your own.
It's stable, but slow. By the time you've developed your own system, others may have already captured most of the market.
"Let's see what conditions they offer first," Lu Ran finally said. "If the conditions are suitable, we can consider it. But there's one bottom line—no controlling stake, no interference in operations, and no touching TUTU's core user data."
Zhou Mingzhe nodded and wrote these down in his notebook.
"Oh, right," he suddenly remembered something, "it seems like Tencent is making some moves too."
"What's that noise?"
"I heard that the EA vice president went to Tencent first," Zhou Mingzhe said. "He arrived in Shanghai yesterday and went to Tencent's East China branch early this morning. They should still be talking right now."
Lu Ran raised an eyebrow: "They've already gone to Tencent?"
"Yes. It seems that in their eyes, Tencent is still bigger than us."
"That's normal." Lu Ran laughed. "After all, they're a giant, they have high standards. We're just a small company with only 50 million daily active users, it's normal that they look down on us."
He paused, then his tone became more relaxed: "Let them talk first. If they succeed, we congratulate Tencent. If they fail, we'll try again."
Zhou Mingzhe was taken aback: "Aren't you afraid that Tencent might actually cooperate with EA? That would give them a huge advantage."
"Like adding wings to a tiger?" Lu Ran shook his head. "Brother Zhou, you're too naive. Do you think EA is here to give Tencent wings? They're here to share the pie. Cooperation means Tencent has to give EA a large chunk of its profits. In the short term, it's a boost; in the long term, it's like finding a father figure for themselves."
"And—" he paused, a meaningful smile playing on his lips, "Do you think Tencent, given its nature, would willingly accept being a subordinate?"
Zhou Mingzhe thought for a moment, then slowly shook his head.
"So," Lu Ran patted his shoulder, "let them talk first. The longer they talk, the more conflicts they'll have. Once they break down, we'll step in, and then the terms will be easier to negotiate."
"What's the name of that move you used?"
"Let the snipe and the clam fight, and the fisherman benefits." Lu Ran smiled like a fox. "Go ahead and learn from him."
...
Three days later, the news arrived.
The first round of negotiations between Tencent and EA broke down.
According to insiders, EA's terms were quite harsh—it demanded that Tencent open up the overseas distribution rights for Half-Life, take 50% of the overseas revenue, and hold more than 30% of the shares in the joint venture.
Tencent, of course, wouldn't have it.
Half-Life may have been rushed out, but it's still our own creation. Why should we let you reap the benefits? Besides, giving us 50% of the profits and 30% of the shares isn't a collaboration; it's robbery.
Thus, the first round of negotiations ended in discord.
"President Lu!" Zhou Mingzhe rushed in excitedly, "You guessed right! Their negotiations broke down!"
Lu Ran was drinking tea when he heard this. He put down his teacup and asked slowly, "Tell me the specifics."
"I heard they slammed their fists on the table," Zhou Mingzhe said in a low voice. "The person in charge from Tencent slammed the door and left on the spot, and the vice president from EA turned green with rage."
Lu Ran smiled slightly; just as he had expected.
It's a pity I didn't get to see this scene in person.
"And now?" he asked.
"Now?" Zhou Mingzhe scratched his head. "It seems EA has started contacting other companies. I heard they met with Perfect World this afternoon and NetEase tomorrow. As for us—"
He paused, his expression somewhat subtle: "It seems I haven't received an invitation yet."
Lu Ran nodded, not surprised.
It's normal for EA to look down on itself.
After all, in their eyes, Tencent is the number one player in China's gaming market. Perfect World and NetEase are also established powerhouses. Tutu Technology? A small company founded less than a year ago, starting with just a few small games—what makes it worthy of their attention?
"No rush," he said. "Let them choose first. We'll bring in what's left."
"What if everyone else has picked everything, and there's nothing left for us?"
"Then let's play by ourselves." Lu Ran laughed. "It's not like we can't live without them. We have 'Seven Heroes of Jianghu,' TUTU, 50 million daily active users, and the artist resources of Star Shine, Star Glory, and Star Brilliance. If EA doesn't cooperate with us, it's their loss, not ours."
Zhou Mingzhe thought about it and felt it made sense.
"So we're just going to wait here?"
"No need to wait." Lu Ran stood up. "Let's do our own thing. The Super Girl finals are about to start, right?"
"Yes, next Saturday."
"Okay." Lu Ran nodded. "Then let's do a good job with the finals. Let's generate buzz, increase traffic, and expand our influence. Super Girl has a lot of buzz, and if we use it well, it can be a great asset. Once EA finds out that in the Chinese market, besides Tencent, there's someone as competitive as us, then it won't be them picking us, it will be us picking them."
...