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China's games market is officially open for business again

China's games market is officially open for business again

China’s games freeze is officially over after new industry regulator the State Administration of Press & Publication finished reforms and approved 80 new licences.

The greenlight for these titles was given just before the turn of the year and they mark the first licences to be issued to developers following a nine-month blockade.

During this time new games were still being released - those that had already obtained their licences - but newer titles were not able to get through. There were also issues with monetisation, as Tencent for example could not monetise one of China's most popular games, PUBG Mobile.

Despite a return to China issuing licences, it may take a while to get back on track, with a large backlog of thousands of titles for the new regulator to sift through and tougher rules to follow.

You can see the list of the 80 titles to be approved here. The country’s two biggest games publishers, the Mobile Games Awards-nominated Tencent and NetEase, have not made the first batch.

A long road

China’s games licensing freeze began in March 2018. A new regulatory body was formed in the month, the previously mentioned State Administration of Press & Publication, as part of the ruling Chinese government’s plans to better monitor and control content the public gets its hands on.

No specific reasons for the drastic measures were offered at the time. The move coincided with a government crackdown by the Ministry of Culture and Tourism aimed at tackling rule breaks on the country’s app stores.

Online games portal TapTap was hit with a fine and had its services suspended temporarily for violating games publishing laws in the country. Industry insiders also told us that companies such as Tencent, Xiaomi, 360, IM30, MOKI and others were also affected.

In August 2018, China’s Ministry of Education issued a notice suggesting fresh regulations for the games industry and its new regulator to follow, as part of apparent efforts to prevent myopia - near-sightedness - among children and adolescents.

Recommendations included limits on the amount of time children can play online games, the implementation of an age rating system (while one was in use, it has not been enforced), and a limit on the number of new game releases.

It’s not quite clear yet how big an impact the latter recommendation will have.

A report by China market analyst Niko Partners back in September suggested the impact may be felt most by small developers that churn out titles quickly and mah-jong and poker games.

Back in business

Just before Christmas, the news broke of the Chinese government’s intention to lift its block on new licences. The news was met with stock rises in public companies such as publishing giant Tencent, whose shares had been significantly hit by the games freeze.

PocketGamer.biz understands from multiple sources that some local media outlets in China pulled their initial stories reporting that game approvals were back on.

One rumour circulated was that some websites had published the story ahead of the government’s own official announcement and consequently had their articles pulled.

News that companies can once again launch new games will be cause for relief and jubilation for local and international developers and publishers, with China establishing itself as the world's most lucrative games market.

You can get the latest updates on what's going on in China's mobile games market from the East Meets West track and the local experts attending and speaking at Pocket Gamer Connects London 2019 on January 21st to 22nd.


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Senior Editor

Craig Chapple is Senior Editor of PocketGamer.biz and InfluencerUpdate.biz. He was previously Deputy Editor at Develop and Online Editor at Nintendo of Europe.

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Maciej Burno Director of International Business Development & Marketing
Still far from over. The first wave of approved games (total of 80) is all domestic games. 80% of them are from smaller developers, making me believe that the government is trying to protect smaller companies from going out of business. Giant in the market, Tencent and Netease, did not get any approvals in the first wave.

There are still over 8000 games waiting for approval.

Funny confidence, "8" in Chinese is a very lucky number.
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