FAST-GROWING BUSINESS: AsiaSoft's Mr Tan (above) and IAH's Mr Ong now control the lion's share of Singapore's rapidly expanding online gaming market. Overall, subscriptions are currently growing at 14.2 per cent a year, according to International Data Corporation. -- ASIASOFT CORPORATION, INFOCOMM ASIA HOLDINGS

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Mr Sherman Tan, 48, and Mr Roland Ong, 42, distribute a wealth of popular games - from World of Warcraft to Granado Espada - in a market that knows only good times.

The games - known in industry jargon as 'massively multiplayer online role-playing games', or MMORPG - are played by millions across time zones and borders. The market worldwide is tipped to exceed US$13 billion (S$17.6 billion) by 2012. It is still a relatively young sector in Singapore, but it is already growing at a stunning rate.

Players usually pay monthly subscriptions. Local subscriptions rose by almost 600 per cent from US$1.19 million in 2005 to US$7.9 million in 2006, according to International Data Corporation.

With subscriptions growing at an estimated 14.2 per cent a year, the figures for last year - expected to be out in July - will surely be even greater.

And that is only the tip of the iceberg. Online subscriptions can form as little as 10 per cent of revenues, estimate industry experts.

Most of the money is in the sale of pre-paid cards used to buy the games' items.

It all adds up to a winning score for Mr Tan and his firm, AsiaSoft Corporation, and Mr Ong, who heads Infocomm Asia Holdings (IAH).

They control the lion's share of the Singapore market, and both are the sole publishers and operators of the titles in their stables.

'Internet penetration of Singapore households is at 66 per cent. Online games are now more accessible than ever; one just needs an Internet connection,' Mr Tan told The Straits Times.

Before starting AsiaSoft, he worked in marketing at software firm Berkeley Multimedia, which operated alongside top game developers like Sierra-On-Line, Lego and Blizzard, which created the hit World of Warcraft.

Mr Tan started AsiaSoft with his partner, Mr Pramoth Sudjitporn, in 2001 in Thailand, where it is still based. It reaped such huge successes that Mr Tan decided to expand elsewhere in South-east Asia, including Singapore.

AsiaSoft's hottest titles include MapleStory, which has more than two million registered users in Asia, and World of Warcraft, which has a player base of 5.5 million in the region.

Success has also come to IAH, founded in 2004 by Mr Ong, a veteran of the information technology and gaming industries. He helped design the infrastructure for the joint project by the Ministry of Education and National Library Board to stream multimedia content to all schools and libraries in Singapore.

IAH, which has more than 40 employees, boasts titles like Hellgate: London and Granado Espada, a favourite among 600,000 Asian users.

The online gaming industry runs on an unusual model, one that evolved because of the huge cost - estimated at US$10 million or more - of developing multi-player games.

Game developers usually approach publishers like AsiaSoft and IAH with an initial idea. If the publishers like what they see, they will each partially finance the project and buy the rights to market the game in their region. Game developers then get a cut of the profits.

Many games can be played for free, but some require subscriptions. Playing World of Warcraft for two months, for instance, will cost $59.90.

Most of the revenues for firms like AsiaSoft and IAH come from the sale of 'in-game items', such as weapons, upgrades and accessories, for online characters.

It may sound like easy pickings, but anyone keen to get on the gaming bandwagon needs to think twice given the high initial capital outlay.

'The start-up costs run into the millions, with funds going into licensing, infrastructure, marketing and opening up of distribution channels,' Mr Ong said.

ongbihui@sph.com.sg