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Video gaming
TechPolicy

Tencent and NetEase video game drought continues as China approves another 69 titles, mostly from small developers

  • The National Press and Publication Administration has approved 241 video game titles for sale in China this year, far behind previous years
  • Tencent and NetEase have not had new titles approved in more than a year and have relied on unpublished games approved before the licensing freeze

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The Tencent Games logo seen on a mobile phone in this illustration picture taken August 3, 2021. Photo: Reuters
Ann Cao
China’s publication regulator granted 69 new video game licences on Monday, once again excluding Tencent Holdings and NetEase from the biggest batch of approvals so far this year.

The latest list from the National Press and Publication Administration (NPPA), China’s top watchdog for video games and other online media, includes 65 mobile titles, with two others for the Nintendo Switch, one for personal computers and one browser-based game. Without any new titles approved in over a year, the two largest developers in China’s US$49 billion video gaming market have been left out of the gradual recovery since the end of an eight-month licensing freeze in April.

The continued drought in August marks 14 months since Tencent last had a new game approved and 13 months for NetEase. With the exception of two prolonged suspensions in 2018 and 2021, the NPPA typically releases a list of new game approvals every month.

Tencent’s shares have slumped 37.4 per cent in Hong Kong since the end of last July, when the last list was released before the licensing freeze. NetEase’s shares have fallen about 10 per cent in the same period.

The companies, which already own some of the most popular and lucrative mobile games in the country, have been able to put out new titles approved before the licensing freeze. On July 20, Tencent released League of Legends Esports Manager, which was approved in June of last year. NetEase’s long awaited Diablo Immortal was released in China on July 25, which was approved in February 2021.

That brings Tencent and NetEase closer to using up the last of their licensed unpublished games. In 2021, Tencent obtained licences for publishing or operating nine games in China, six of which have yet to be released. NetEase received 11 licences last year, with only three left to be released.

The freeze on new licences last year, accompanied by a gameplay time limit that bans gamers under 18 years old from playing online for more than three hours per week, dealt a heavy blow to the world’s largest gaming market. An economic slowdown has also dampened consumer spending in the country.
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