VANCOUVER, Bristish Columbia, April 29, 2004 (PRIMEZONE) -- CYOP Systems International Inc. (OTCBB:CYOS), the leading provider of online video games and tournaments of skill, commented today on the estimated growth projections of the online gaming industry in Asia.
The market for online games in the Asia-Pacific region was $640m in 2003, and will grow to $720m in 2004. Government support of broadband and the PC availability phenomenon both contributed to the runaway growth of online gaming in Korea, which is now being replicated in hyper-growth markets Taiwan and China.
Population-wise, China's Internet had more than 22 million new users on the Web last year, bringing the total number of Chinese online to 80 million. That makes China second only to the U.S. in Internet subscribers, however, by 2006, it is expected to overtake the U.S., with 153 million Chinese online. The surge is being driven by several factors, including a strong economy that's letting people buy PCs, and the opportunity the Internet provides to skirt China's tight government censorship. China also has over 40,000 PC cafes nationwide, mirroring the South Korean Internet phenomenon in the late 1990s. Out of fourteen hours per month spent online, the average Chinese Internet user spends eight hours playing games.
The recently published IGDA 2004 Online Gaming White Paper (http://www.igda.org/online/) reported that South Korea has demonstrated the fastest growth in the online gaming market, which is being driven by the highest broadband penetration rates in the world, with over 73% of households with multi-megabit access and PC cafes on nearly every street corner.
The Company believes that there are no major companies marketing skill video games in Asia yet, and that there exists an opportunity for CYOP to establish a foothold. As an early adopter, CYOP believes that it will be able to capture a significant market share of the industry within the next twelve months, and gross profit margins after direct costs and revenue splits will be in the 20% range.
For example:
Percentage of market
share (2004) Revenues Gross Profit Margin
1/2% $3.6 million $720,000
1% $7.2 million $1.4 million
2% $14.4 million $2.88 million
5% $36 million $7.2 million
Patrick Smyth, President of CYOP, commented, "I-Gaming is flourishing in English-speaking countries, however, a tremendous market has been undervalued in regions that are realizing formidable growth in online access. Out of the key world trading blocks, China and Korea lead the number of online gamers on the planet. China's strong economy and a large population, inclined to spend its disposable income on leisure goods and services, makes it a natural objective for our growth. Korea's fondness for gaming and the status that its society puts on this form of entertainment make it a primary country in which to market games. We believe that the Asia is set for several years of strong growth driven by advanced infrastructure, increased Internet access, and a population that, simply put, loves to play online games."
About CYOP
CYOP is a developer and provider of online skill-games and services for the online entertainment and gaming industries. CrediPlay, CYOP's licensed application, is an online transaction platform that is based on charging a fee for each game of skill played over the Internet. CYOP's central games portal, www.skillarcade.com, features virtual sports games, puzzles, card games, action games, strategy, driving, racing and adventure games where people play popular skill games against other players and compete in tournaments to win real money prizes.
For more information please visit www.cyopsystems.com.
This press release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Exchange Act of 1934 and the provisions of the Private Securities Litigation Reform Act of 1995 and is subject to safe harbor created by these sections. Actual results may differ materially due to a number of risks, including, but not limited to, technological and operational challenges, needs for additional capital, changes in consumer preferences, legal risks associated with Internet gaming and risks of governmental legislation and regulation, risks associated with market acceptance and technological changes, risks associated with dependence on software providers, URL providers, risks relating to international operations, and risks associated with competition. This document is not intended to be and is not an advertisement for any securities of the company.