Power struggle among Chinese regulators stalls approvals of new video and smartphone games
The National Radio and Television Administration has not granted licenses for about four months, while the Ministry of Culture and Tourism has made game registration procedures more stringent
China’s regulators have frozen approval of game licenses amid a government shake-up, according to people familiar with the matter, throwing the world’s biggest gaming market into disarray.
The halt follows a restructuring of power among departments, said the people, who asked not to be named because they don’t have approval to discuss the issue publicly. Regulators have also been concerned about violence and gambling in some games, according to one person. Online, mobile and console games have all been affected.
The whole sector has been rattled as gaming companies from online giant Tencent Holdings to small developers await approvals. Tencent, the country’s gaming and social media goliath, has shed more than US$150 billion in market value since its January peak, while smaller players complain they are struggling to survive without new titles. China is the world’s largest gaming market with an estimated US$37.9 billion in revenue, according to research by Newzoo.
“For new game approvals, there will continue to be a drag,” Alicia Yap, Citigroup Global Markets’s head of pan-Asia internet research. “If they previously didn’t get an approval, it seems that there will continue to be a hold on that.”
Jane Yip, a spokeswoman for Tencent, declined to comment on game approvals. The ministries didn’t immediately respond to faxed requests for comment.