Chapter 76 Asset-light vs. Asset-heavy

Author: Dr. Yingman

Chapter 76 Asset-light vs. Asset-heavy

Moreover, Sugon's new mobile phone factory is still under construction. Even if a new mobile phone is developed at this time, it is just a competition for production capacity. There is no need to launch a new mobile phone.

Of course, the reason why Lin Chen thinks so is that he has the King of Copycat system. He really wants to launch a new mobile phone with a configuration that is basically just a case change and upgraded configuration. It will not take long in reality.

For Lin Chen, one month is enough. During this window period, he might as well spend his energy on porting more games.

After all, the selling point of their Sugon A1 mobile phone is that in addition to being durable and of good quality, the most important thing is that it can play Famicom games.

However, facing the admiring looks from Huang Hua and Chen Dong, Lin Chen did not feel complacent, but looked at Chen Dong and said seriously:

"Our company is facing negative public opinion pressure, which makes some people dislike it and choose to leave. This is a good thing. The instability factor has left our Sugon Technology.

The remaining people who are not leaving are all trustworthy people. Next, you need to investigate and select our internal staff at Sugon Technology, and then set up a mobile game transplant team.

In the future, we will find ways to transplant all popular games from the Famicom and old arcade machines to our Sugon mobile system.

As for the problem that old arcade machines have too high performance requirements for mobile phones and cannot run Sugon A1 mobile phones, there is no need to worry.

The performance of mobile phone processors will also gradually improve in accordance with Moore's Law. The performance of this year's mobile phone processors is too low to run, so the new mobile phone processors next year and the year after may be able to support it.

I heard that Texas Instruments is developing the next generation mobile phone processor OMAP1710. The next generation OMAP171 mobile phone processor is said to improve performance by 40%.

So our current mobile phone processor may not be able to support old arcade games, but the next OMAP1710 mobile phone processor should be able to barely play old arcade games with low performance requirements.

Therefore, it may be possible to transplant all old arcade games such as "King of Fighters 97", "Dino Fighter", "Street Fighter" and "Three Kingdoms" to new mobile phones."

Upon hearing this, Huang Hua and Chen Dong's eyes suddenly lit up, and then they looked at Lin Chen in shock.

Here in Daxia, the influence of arcade games is many times greater than that of home console games!

Because many people may not have a home console due to lack of funds or pressure from their parents, but many of them have been to arcades and played arcade games!

And although it’s not impossible to play games by yourself, it’s more fun when there are more people.

Fighting with heaven is endless fun, fighting with earth is endless fun, and fighting with humans is even more fun.

Therefore, the player base of arcade games is actually ten times larger than the home console game base. If Sugon Mobile can really transplant those popular arcade games to the next generation Sugon Mobile phone.

Let the next generation Sugon mobile phone play those popular games, and preferably if it can play arcade games online, then it is very possible to defeat the Hashishima mobile phone based on this alone!

After all, don’t underestimate the people’s love for games in Daxia.

It is said that Chen Tianqiao, the boss of Shengda Network, which operates online games, can earn 56 million yuan every month with only four games such as "Legend", "New Hero Gate", and "Crazy Tank" and is expected to have an annual income of 690 million yuan!

A monthly income of 56 million and an annual income of 690 million are terrifying figures, figures that would make Sugon Technology envious.

Because the current monthly production capacity of Sugon mobile phones is only 120,000 units, the profit of each mobile phone is only more than 400 yuan, and Sugon Technology is an asset-heavy industry.

The other party is an online game agent in a light-asset industry. Shuguang Technology is an asset-heavy industry and needs to invest huge R&D costs and purchase various equipment.

So in the end, when calculating which company can really save the most money that can be distributed as dividends, the answer is undoubtedly Chen Tianqiao, Shengda Network, a company that operates light-asset online games.

Therefore, in terms of the final real dividend capacity, Sugon Technology needs to spend more funds to expand production and develop new technologies and new mobile phones.

The final calculation will definitely reveal that although the monthly profit difference between Sugon Technology and Shengda Network is less than 10 million, Sugon Technology needs to invest huge operating and R&D costs because it is an asset-heavy industry.

In the end, you will find that the actual dividend income that several Sugon Technologies can get is not as good as the dividend income of Shengda Network. Therefore, it is really profitable to engage in an asset-light model such as online games in this era.

Or to be more precise, it’s not just this era, even if you engage in Internet oil in 2023, it will be really profitable. This is the benefit of the asset-light industry!

Of course, the asset-heavy model is not without its benefits. The advantage is that it is easy to form a disguised monopoly. The asset-heavy model has low competitive pressure and can continue to make money for many years.

Because the cost of investing in heavy assets is very high, if a new enterprise wants to grow, it will need more funds to build factories.

We need to allocate more funds for scientific research and development, and we need to find ways to bypass other people's patent barriers and develop our own technology patents.

Therefore, the cost of playing heavy assets is quite high, which can scare away a lot of capital, which ultimately leads to low competitive pressure in the industry.

At this time, if you can become one of the top players in the industry and master many patents, you will be able to reap the dividends of the industry, and your income will be very stable, and you will also be able to gain a disguised monopoly because there are relatively few competitors.

After all, if light assets require less investment, then there will be many more peers, and the competition pressure is high and the company may overturn at any time, so both light assets and heavy assets have their own benefits.

"Can you play arcade games on your phone? It would be great if you could do that."

Chen Dong on the side felt very excited when he heard Lin Chen's words.

"Of course you can."

Lin Chen nodded slightly. It is indeed a bit difficult to play arcade games on mobile phones in this era.

But it will only take two or three years at most. According to Moore's Law, there will definitely be a processor that can support all arcade games and meet the performance standards.

Of course, it doesn't matter even if the performance doesn't meet the standard in 2 to 3 years. Sugon Technology can develop its own high-performance mobile phone processor.

But in this case, the gameplay of the game will not be the same. The new gameplay is to cultivate your own game ecosystem, software ecosystem, and hardware ecosystem to form a perfect closed loop.

Just like Pingguo mobile phones in later generations, mobile phone processors are produced by themselves, and the mobile phone system and software game ecosystem are also controlled by themselves, eventually forming a complete software and hardware ecosystem!

Of course, these are still too far away, and are not what Sugon Technology can think of now. Sugon Technology is qualified to do this only if it defeats the current domestic mobile phone leader Boda Mobile.

So as Lin Chen made a decision, the following meeting became quite boring. Soon, Sugon Technology fell into a busy working state.

…

The morning three days later.

There are currently 42 Shuguang Electronics directly-operated stores across the country, and at the same time, 42 grand events were held that were destined to shock the country.

First of all, thank you Yumi for the reward!

In addition, let’s talk about the plan to put this book on the shelves. After 4 rounds of recommendations, this book failed to advance and was unable to be recommended by Sanjiang. It had no choice but to be put on the shelves next Friday (April 14, 2023).

There will definitely be plans to update the game on the day it goes on sale. The number of updates depends on how exciting that day is. If the day of release is dull, then maybe the chapter 2 will be updated as usual without any updates.

Of course, if it's exciting enough, it's not impossible to release all the current 10 chapters in one go. Anyway, let's look forward to next week's Friday.
Chapter completed!