China doles out 87 new video game licences in February, with Tencent and NetEase among the recipients
- Tencent, the world’s largest video games publisher by revenue, got the green light for ‘Wang Zhe Wan Xiang Qi’
- NetEase, China’s second-largest gaming company, won approval for a new PC game related to its hit mobile title Fantasy Westward Journey
China approved 87 new video game licences in February, in a further sign that regulatory pressure is easing in the world’s largest video games market.
The National Press and Publication Administration (NPPA), the agency that oversees online games in China, published its latest list of approvals on Friday, with titles from Tencent Holdings and NetEase – the country’s two biggest video games companies – among the beneficiaries.
Tencent, the world’s largest video games publisher by revenue, got the green light for Wang Zhe Wan Xiang Qi, a strategy game based on its flagship mobile title Honour of Kings.
Electronic Arts to shut down popular mobile game title co-developed with Tencent
The mobile game was first revealed by Tencent in November 2022, along with two other mobile games adapted from the hit multiplayer online battle arena (MOBA) game.
Honour of Kings, released in 2015, was ranked as the most lucrative mobile game in 2022 after racking up US$2.2 billion in sales, according to data from Appmagic.
NetEase, China’s second-largest gaming company, won approval for a new PC game related to its hit mobile title Fantasy Westward Journey, which was ranked ninth by global revenue in 2022, according to Appmagic. NetEase has yet to disclose any information about the game.
Although the number of new licences given to the two top game publishers fell from January, when Tencent and NetEase received four licences in total, the latest award is nevertheless a signal that the regulator has adopted a more positive stance in recent months.
01:14
Lab-grown brain cells play Pong video game after learning with real-time performance feedback
Tencent and NetEase secured eight and five licences in 2022 respectively, down from nine and 12 in 2021. The market valuation of both companies dropped sharply over the past year.
The latest batch of approvals comes after the regulator gave out 88 licences in total for domestic games in January, higher than any monthly domestic approval tally seen in 2022.
The 175 licences approved in the first two months accounts for nearly one-third of the total amount given out throughout 2022, when 468 domestic games and 44 imported games were approved.
Star Wars robot maker seeks IPO in boost to Hong Kong’s capital markets
Lingxi Games, the gaming subsidiary of e-commerce giant Alibaba Group Holding, also received a licence for a mobile game named Chun Qiu Xuan Qi. Alibaba owns the South China Morning Post.
Other companies appearing on the latest approvals list include Hong Kong-listed XD Inc and Leiting Games, which is owned by Shanghai-listed G-bits Network Technology.
China’s gaming industry has been gradually recovering from a year-long crackdown that started in late 2021, when Beijing began an eight-month freeze on new game approvals and imposed a strict limit on the weekly game time for minors. As a result, the industry endured a sluggish 2022 amid regulatory and economic headwinds.
Video game sales in China slumped over 10 per cent to 269.5 billion yuan (US$39.6 billion) in 2022, marking the first drop in at least two decades, with the number of gamers slipping 0.33 per cent to 664 million, according to a report published in January by the country’s semi-official gaming industry association.
