China’s online games market raked in an impressive $2.8 billion in 2008, up 63% according to Pearl Research’s latest estimates. Online games, which consist of massively multiplayer online games such as Blizzard’s World of Warcraft and quick and easy-to-play casual games, are one of the most popular past times for Chinese Internet users.

Online gaming continues to be the top revenue generator among the digital media companies in China, even surpassing those of search engines and portals. The top two gaming companies, Shanda (SNDA) and Netease (NTES), generated $522 million and $436 million in revenues respectively in 2008. Their online gaming revenues exceed those of search engine company Baidu (BIDU) with $469 million and media firm Sina (SINA) with $369.6 million in revenues.

While China has received substantial attention with its gaming market, South Korea is still a market leader in online games. Pearl Research forecasts the online games market in South Korea will exceed $1.7 billion by 2009, driven by new releases and a fervent gaming culture.

One of the fastest growing segments is casual games, that are free-to-play, easy-to-learn and can be played in “micro-slices” of time of ten minutes or less. Pearl Research’s key findings published in our “Games Market in Korea” study include:

A common question from our clients at Pearl Research is how we would rate the content and services from game operators Shanda (SNDA), Netease (NTES), The9 (NCTY), Giant Interactive (GA) and Tencent (TCEHF.PK).

To fully understand how these titles will perform, Pearl Research conducts deep competitive of these titles through our playtesting, interviews with Chinese consumers and our exclusive online surveys.

China, the world’s largest mobile market, remains an untapped market for the new Apple (AAPL) 3G iPhone. On June 9, Apple announced a 3G iPhone retailing for $199 at its worldwide developers conference, half the price of its $499 original iPhone model.

China could be a significant market for Apple with its 565 million mobile phone users and trend-conscious consumers. The iPhone has not been officially released in mainland China, but can be found on store shelves through gray imports.

The year 2007 was a banner year for China’s online games industry and 2008 is expected to be just as robust. China’s online games market raked in an impressive $1.66 billion in 2007, up 60% according to Pearl Research’s latest estimates.

Online gaming continues to be the top revenue generator among the digital media companies in China. The top two gaming companies, Shanda (SNDA) and Netease (NTES), generated $338 million and $265 million in revenues respectively. Their online gaming revenues eclipse the revenues of search engine company Baidu (BIDU) with $239 million and media firm Sina with $246 million.