Page 65 - The Economist

The Economist December 9th 2017 Business 65
2 rea, Singapore, Australia and Hawaii have
also made disapproving sounds. In Britain
the Gambling Commission has said that
publishers of games must buy a gambling
licence only if the contents of loot boxes
can be converted back into money. Often
they cannot, at least in theory. In practice
the distinction is murkier. There are plenty
of grey-market websites that allow gamers
to buy and sell accounts for individual
games. (On one such site, for instance,
punters can buy the login details for an
“Overwatch” account boasting of several
rare “skins”, orcostumes, for$295.)
Noteveryone isworried. The Entertain-
ment Software Rating Board (ESRB), an
American organisation that provides vo-
luntaryage ratingsforgames, saysthatloot Foreign brand names in China
boxes are not gambling, on the grounds
thatplayersalwayswin something, even if Found in translation
itisoflittle value. Butthe controversyis un-
likely to end, for loot boxes are a response
to a long-standing problem within the vid- Westerncompanies are daring to getcreative with theirChinese names
eo-games industry. The retail price of a
blockbuster game has stayed at between CDONALD’S drew ridicule in China 2.8m trademarkapplications in China,
$40 and $60 for over twenty years, thanks Mwhen it changed its registered name more than treble those in America and
to the price-sensitivity of customers and there to Jingongmen, or“Golden Arches”, the EU combined. Companies consid-
widespread discounting of games online. in October, afterit was sold to a Chinese eringenteringthe Chinese market might
Accounting for inflation, prices have fallen consortium. Some on Weibo, a micro- often find that theirproducts have al-
in real terms by a third or more at a time bloggingsite, thought it sounded old- ready been given local names, thanks, for
when production budgets have ballooned fashioned and awkward, others that it example, to coverage in the press.
to tens or hundreds of millions of dollars had connotations offurniture. The fast- Some even find that theirChinese
fora high-quality game. food chain was quickto reassure custom- name has already been trademarked,
So publishers have been searching for ers that its restaurants would continue to says Matthew Dresden ofHarris Bricken,
new revenues. Many split video games go by Maidanglao, a rough transliteration a law firm, eitherby theirown distrib-
into smaller chunks and charge separately that has, overthe years, become a recog- utors, competitors seekingto block its
for each, selling a base game for $60, then nisable brand name. But formost compa- entry, counterfeiters hopingto pass as the
releasing extra downloadable content a nies now enteringChinese markets, company, orsquatters intendingto sell
fewmonthslater. Anotheroption isto offer transliterations are a thingofthe past, the trademarkto the highest bidder.
expensive “collector’s edition” boxes with says Amanda Liu, vice-president ofLab- Counterfeiters might also take advantage
soundtrackCDs and the like. brand, a consultancy based in Shanghai ofsoundalikes, says MrDresden, who
Loot boxes, though, cost nothing to that advises firms on brand names. advises clients to trademarkthose, too.
make. Even though most players indulge Companies are instead choosing Such complexities have often tripped
only sparingly, that makes them extremely Chinese names with meanings that up foreign brands. Pfizertried to stop
profitable. The industry also uses psycho- capture people’s imagination. That often Viaman, a Chinese drugmaker, from
logical tricks long known to makers of involves goingbeyond a direct transla- usingthe local name forViagra—Weige, or
gaming machines. Some games announce tion. New entrants are takinginspiration “mighty brother”—but was unable to
when a player’s friends have won big, en- from BMW, which is the evocative convince the courts that ownership of
couraging them to think they could be Baoma, or“treasure horse”, in China, and the trademarkshould be transferred to it.
next. Others tweak the algorithms in va- from Coca-Cola, which is Kekoukele,or (Pfizerdid manage to stop Viaman and
rious ways, such as making sure droughts “delicious happiness”. otherlocal companies from mimicking
do not last too long, which encourages The namingprocess is forcingcompa- Viagra’s diamond shape, though.) After
players to keep buying. nies to thinkharderabout the image they years oflitigation, Michael Jordan won
The backlash against loot boxes is not want to project in China, says Ms Liu. the rights to his name in Chinese—the
coming only from regulators. Many play- LinkedIn, a professional-networking site transliteration Qiaodan — last yearfrom a
ers are unhappy, too. Pressure from cus- owned by Microsoft, chose the name local sportswearcompany which had
tomersthisyearpersuaded EAtemporarily Lingyin, or“leadingelite”, in 2014, signi- registered the trademark(although the
to remove the ability to spend real money fyingmore exclusivity than its Western court ruled he had no rights to the Chi-
on loot boxes in “Star Wars: Battlefront 2”. name. Herothercorporate customers nese name when it was spelt in the
In the end, that sort of bad publicity may have included Airbnb, Marvel Comics Roman alphabet).
prove a bigger stick than gambling laws. and Haribo. Labbrand tests proposals Perhaps thanks to these mishaps,
Laws, after all, can be complied with. But with focus groups, ensuringthat the foreign firms are gettingwiserto the
the video-games industry has spent de- name has no negative associations in any importance ofnamingin China. More
cades trying to shed its image as an un- ofthe majorChinese dialects. Chinese firms are also seekingadvice on
wholesome pastime for oddballs. It has Avital part ofthe process is checking foreign names, says Ms Liu, as they seek
been succeeding, slowly. A public associa- that candidate names have not already to conquerWestern markets. Both know
tion with gamblingwill do thatcause no fa- been snapped up. The Chinese are ener- that ifthey blunder, the social-media
vours. Better, perhaps, to simply raise getic trademarkers: in 2015 there were critics will be waiting.
prices and take the consequences. 7