Gaming is back on in China
Much to the relief of Chinese gaming giants like Tencent and NetEase, Chinaโs industry regulator has approved dozens of foreign and domestic gaming licenses in yet another thaw in Beijingโs sweeping technology crackdown.
Popular games like Pokรฉmon may soon come to China now that the countryโs video game regulator today approved 44 foreign game titles, signaling a further thaw in Beijingโs crackdown on the worldโs largest gaming industry.
Chinese gaming giants Tencent and NetEase were some of the firms that were granted foreign licenses (in Chinese) by the National Press and Publication Administration (NPPA). The industry regulator said in a separate statement (in Chinese) today that it also granted licenses this month to 84 domestic games.
- Tencent received licenses for first-person shooter game Valorant co-developed by U.S.โs Riot Games, as well as for multiplayer battle arena game Pokรฉmon Unite co-developed with Japanโs Nintendo.
- NetEase, a rival to Tencent, also won the approval for Nintendoโs Fantasy Life.
The NPPA has now approved more than 500 video games this year since it unfroze the licensing process in April. This is a huge relief for Chinese tech companies, which have been starved of Chinaโs more than 700 million gamers. They derive a large chunk of revenue from publishing both self-developed and imported games.
- China requires that gaming companies receive government approval before they can be released in the country.
- Many domestic gaming companies like Tencent and NetEase have diverted their energies to developing games for international markets, as well as investing in fewer games with higher potential to increase their chances of success at home.
- โGaming licenses are starting to get approved again. That is very significant for Tencent. Half of the companyโs revenue is actually coming from gaming, so itโs huge for that company,โ Hong Kongโbased market strategist Hรณng Hร o ๆดช็ told The China Project earlier this month.
The approvals signal an end of a painful industry crackdown by Beijing. Authorities in August 2021 launched a campaign to rein in the tech industryโs growing power in areas like ecommerce, fintech, and even education, before it spread to the gaming sector.
- For the first half of this year, Chinaโs game industry recorded a โdouble dropโ of negative revenue growth and a decrease in users for the first time, signaling a steep decline.
- China also limited anyone under the age of 18 to only three hours of gaming per week as per rules introduced in August 2021.
