The Chinese government has a policy of constraining gaming addiction among the youth. Therefore the government body, NPPA (The National Press and Publication Administration), ceases to grant licenses to domestic and international games periodically, severely limiting the release of new games.
After 18 months, China’s NPPA finally granted licenses to 45 international games, according to Reuters, although the South China Morning Post states the number as 44. This number is lower than the last time the agency granted licenses in bulk, which was in 2021, and 76 companies were granted licenses. This represents a pattern of decreasing amount of licenses granted. Looking further back, the agency granted 97 licenses in 2020, 180 in 2019, and 456 games in 2017.
International games cannot be directly released in China, They have to be localized under strict regulations, and a Chinese company must carry out the localization. Riot Games’ world-famous Valorant is among the games that acquired a license to be imported. The game will be localized by China’s Tencent, the world’s largest video game company by revenue. Pokémon Unite by The Pokémon Company is another game that acquired a license and will be localized by Tencent. NetEase, another Chinese company among the world’s top technology companies, has also obtained a license for a role-playing simulation called Fantasy Life, published by Nintendo.
With more than 700 million gamers, China is a very lucrative market for game companies and motivates international giants to push through the red tape to gain or maintain a foothold in the country’s market. The U.S.-based Blizzard Entertainment ends its 14-year partnership with NetEase for a new local partnership.
NPPA’s decision may appear hope-inspiring, but the pattern of decreasing licenses granted is still worrying. Pony Ma Huateng, the founder and Chief Executive of Tencent, expressed that the company’s video gaming division would continue to live under a stringent regulatory environment in a yearly meeting with company employees.
