3 Reasons Why Japan’s Mobile Gaming Giant, DeNA, is Here in Singapore

Arrived at Singapore! Image credit: Flickr: Roving

After day one at TechVenture last week, I sat down with Tetsuya Mori, managing director of DeNA’s Singapore office. We had a really long chat, and I found him to be a nice chap who shares his stories in a very casual but yet insightful manner.

As we sipped our orange juices and munched our puffs, we talked about DeNA’s local and regional strategy at length. If you have been a diligent reader of this blog, your know by now that DeNA has recently set up an office in Singapore. And the office manages not just the Southeast Asia market, but also the India market.

But the strategic function of the office is the real question here, and I asked Mori directly, who shared three reasons why they did so.

To lower development cost

Mori explained that lowering development cost is one of the reasons why they are here in Singapore. He said DeNA’s development firms in Pakistan and Vietnam are equally capable developers, plus they cost less to hire. Mori says that with rising demands and expectations from gamers, mobile games tend to get bigger in memory size. So the very fact that DeNA is looking abroad for developers is a long term commitment to reduce development cost as gamers’ demand will surely scale according to time.

Mori pointed out Punch Entertainment Vietnam, a development firm which DeNA recently acquired as one of the most efficient firms they have in the region. I asked whether DeNA is still hiring or acquiring companies. Mori just smiled and said there’s a possibility as long there’s a fit between two companies. However, he remained tightlipped when asked which are the few companies DeNA is looking at right now.

To understand the market

DeNA admits that it is new to this region and it takes time to understand the market. Mori revealed that the company is likely to offer Mobage in Southeast Asia soon, probably around early or mid 2012. But he did specify that his team is still considering which country to launch Mobage in first. It could be Indonesia, India, or Malaysia — Who knows?

He says that DeNA is careful because the company didn’t want to fail in its first attempt in the Southeast Asia market. His team has and will continue to work closely with local and regional telcos and developers to understand the market better. And Singapore as a starting point is perfect since it is the hub of Asia.

To reduce tax

Tax in Japan and California could go over 40 percent, while Singapore is pretty tax friendly in contrast, especially with the tax concession. “It’s all about cutting cost on a global scale,” explained Mori.

So that’s why DeNA is in Singapore. Stay tuned for more on my sit-down with Mori-san.