(Yicai) Dec. 22 -- China’s game market, which logged record-high revenue and user numbers this year, is shifting to a phase of fierce competition as many industry leaders, such as ByteDance Technology and miHoYo, lay off staff and shut down projects to stay ahead of the game, an analyst told Yicai. 

The gaming industry has entered a stage of fierce internal competition from one of external expansion, and innovation and technological strength are the key factors that will determine the future of a game developer, Zhang Shule, a game industry analyst, told Yicai. 

China’s gaming market logged a 14 percent jump in revenue this year from the year before to CNY303 billion (USD42.4 billion) and the number of users climbed 0.6 percent to 668 million, both new highs, according to a report recently issued at the 2023 China Game Industry Annual Conference. 

But despite the encouraging figures, since the second half of last year many big game publishers such as ByteDance, miHoYo, Lilith Games and Papergames started to lay off employees and halt projects amid an industry slowdwon. 

MiHoYo called off a project called ProjectSH led by Chief Executive Cai Haoyu at the end of last year. Lilith Games shut down three projects last year. Papergames also cancelled a project in May and nearly 100 employees were dismissed, a staff member told Yicai. 

It is hard to find new jobs as there are fewer projects, an industry veteran told Yicai. People are waiting six months to a year to find a new job, he added. 

Bilibili’s Guangzhou game studio reduced its headcount by over 200 employees in two job cuts in June and October. While ByteDance’s five-year old gaming business, in which the TikTok operator has invested tens of billions of yuan which is equivalent to billions of US dollars, started laying off staff last month. 

The good days are over and the industry will face more competition as overseas game developers make greater efforts to develop mobile games, the veteran said. 

Editor: Kim Taylor