Tencent to shore up gaming lead in China with Call of Duty, Ring Fit Adventure

Call of Duty: Mobile is expected to further grow Tencent’s share in China’s mobile games arena
Nintendo’s Ring Fit Adventure could give a much-needed shot in the arm to Tencent’s nascent console gaming business

Tencent

Josh Ye

Published: 8:15pm, 7 Aug, 2020

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Tencent Holdings aims to shore up its lead in China’s vast video games industry, after receiving the government’s go-ahead to publish popular titles Call of Duty: Mobile and Ring Fit Adventure for the domestic market, analysts said.

Industry regulator the National Press and Publication Administration on Thursday approved those two games and 26 other foreign titles, including Harry Potter: Magic Awakened from NetEase and Human: Fall Flat under local publisher XD Network.

Call of Duty: Mobile, developed by Tencent’s TiMi Studios, is expected to further expand the Shenzhen-based company’s share in China’s mobile games arena, while Nintendo’s Ring Fit Adventure could give a much-needed shot in the arm to its nascent console gaming business, according to analysts. Tencent is the exclusive local distributor of the Nintendo Switch console.

Tencent, which runs the world’s largest video games business by revenue and China’s biggest social media platform, did not immediately reply to emailed questions about the official domestic release dates for those two games.

The diversified internet giant is considered one of the few beneficiaries of the coronavirus pandemic, as millions of people in lockdown across China turned to games, cloud services, collaborative tools and other online services for entertainment, education or work.

Popular shooter game Call of Duty: Mobile recorded 250 million downloads as of June this year. Photo: Handout

“We expect Call of Duty: Mobile to be a strong performer for Activision and Tencent in China,” said Daniel Ahmad, senior analyst at market research firm Niko Partners. Activision, the publishing arm of US video games company Activision Blizzard, is one of the international publishers of Call of Duty: Mobile for Android and iOS.

The game recorded 250 million downloads worldwide in under nine months, showing potential to become the most successful game on the mobile platform, according to data from app tracking firm Sensor Tower. It has been available outside China since October last year.

In the domestic market, the game has the potential to further broaden interest in e-sports.

“We believe that the game can become a top e-sport in China, where there are over 350 million e-sports fans,” said Ahmad, citing Niko Partners’ latest market report.

E-sports’ local popularity is a testament to the convergence of online gaming and live-streaming – two prominent pillars of digital life in China.

China’s e-sports market revenue reached 117.5 billion yuan (US$16.9 billion) last year, up 25 per cent year from 2018, boosted by official recognition of the sector, according to iResearch Consulting Group.

Exercise action-role playing game Ring Fit Adventure was developed by Nintendo for its Switch console. Photo: Handout

While its regulatory approval was still pending in China, Ring Fit Adventure saw demand rise among local Nintendo Switch users who wanted to exercise while on lockdown even though it meant paying higher prices to online merchants.

“Due to a global shortage, the price of the game skyrocketed from 700 yuan to over 2,000 yuan within one month,” Niko Partners’ Ahmad said.

Hours after the game was approved for release, Tencent posted on Weibo on Thursday that Ring Fit Adventure will sell for 499 yuan.

“We believe it will boost sales of the Chinese Nintendo Switch console due to its affordable price and high demand,” Ahmad said.

Tencent’s domestic sales of Nintendo Switch had been hampered by the lack of games for the console. There are now hundreds of titles available on the Switch overseas, but only 10 games can be played in the domestic market.

China – with more than 720 million gamers across mobile, desktop personal computer and console hardware – is projected to generate about US$36 billion in revenue this year, up from US$33 billion in 2019, according to Niko Partners.

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