Niko Partners, the leading market intelligence firm on China's video game industry, today announced results from its latest report citing China's 46 million gamers spent $1.7 billion on online games in 2007, up 71% from 2006.

Advanced casual and casual online games made up 21% of the total, and new flash-based casual versions of popular MMO and RTS games demonstrated the hardcore gamers' appetite to play casual games along with subscription MMOs. Online revenue is expected to reach $2.5 billion in 2008 and $6 billion in 2012, for a 29% compound annual growth rate in the five-year period.

"China's spending on games is up thanks to their booming economy," said Lisa Cosmas Hanson, managing partner of Niko Partners. "14 million hardcore Chinese gamers play online games more than 22 hours per week. They play online, LAN, and single-player offline PC games in China's 185,000 Internet cafés and increasingly on their PCs at home, thanks to falling prices and higher disposable income."