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China has frozen all game license approvals due to restructuring. Which is a problem for everyone in the industry with a stake in China’s gaming. Because no game license, no game distribution in the country; everything has to be approved.
Apparently, the restructuring has been going on for a while, actually, because no new games have been approved for four months. Since there’s no clear line of leadership in the departments that handle these licenses due to that, regulators have been hesitant to approve anything. This affects all sorts of media, but games are the hardest hit. Mostly due to the fact that they’re the easiest to hide government dissent in, as well as their perceived addictive qualities. And the whole loot box/gambling fiasco hasn’t helped (good job, EA!).
This has affected the country’s largest game distributor, Tencent. They’ve lost $150 billion off their markedt value this year, due in thanks to the freeze. They’ve also been unable to get licenses for PUBG (both desktop and mobile versions), and the desktop version of Fortnite. That’s in addition to having to pull Monster Hunter World from their platforms due to licensing issues.
The freeze has also affected Japanese companies like Capcom and Konami, their shares dropping by 2.7 points and 4.2 points, respectively.That said, the hardest hit will be smaller, local developers, as usual. And the freeze shoows no signs of letting up soon. According to Alicia Yap of Citigroup’s pan-Asia internet research via Bloomberg:
For new game approvals, there will continue to be a drag. If they previously didn’t get an approval, it seems that there will continue to be a hold on that.
Source: PC Gamer
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