China Approves 87 New Video Game Licenses In February

China’s approval of 87 new video game licenses in February is another sign that regulatory pressure in the world’s largest video game market is easing.

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China’s approval of 87 new video game licenses in February is another sign that regulatory pressure in the world’s largest video game market is easing.

Games from Tencent Holdings and NetEase, the two biggest game developers in the country, were included in the National Press and Publication Administration’s (NPPA) most recent list of approved titles, which was published on Friday.

It has been approved for the strategy game Wang Zhe Wan Xiang Qi, which is based on Tencent‘s bestselling app, Honour of Kings. By revenue, Tencent is the biggest video game publisher in the world.

The mobile game was first released by Tencent in November 2022, along with two other mobile games that were also based on the well-known multiplayer online battle arena (MOBA) game. Honor of Kings, which has generated US$2.2 billion in revenue since its launch in 2015, was named the most lucrative mobile game in 2022 by Appmagic.

A new PC game based on NetEase’s well-known mobile game Fantasy Westward Journey, which was ranked ninth by global revenue in 2022, was approved, according to Appmagic, the second-largest gaming company in China. NetEase has yet to release any information about the game.

The number of new  licenses awarded to the two top video game publishers has decreased from January, when Tencent and NetEase each received four licenses, but the most recent award still shows that the regulator has recently adopted a more lenient attitude. Tencent and NetEase each obtained eight and five licenses in 2022, compared to nine and twelve the year before.

The market values of both companies decreased significantly over the previous year. In total, the regulator approved 88 licences for domestic video games in January, more than any other month in 2022.

These 88 licences were followed by this most recent round of approvals. The 175 licences approved in the first two months accounted for nearly one-third of the total amount granted throughout 2022, when 468 domestic games and 44 imported games were approved.

The gaming arm of the enormous e-commerce company Alibaba Group Holding, Lingxi Games, was also given a licence for the mobile game Chun Qiu Xuan Qi. Alibaba owns the South China Morning Post. The most recent approvals list also includes Leiting Games-owned XD Inc., which is listed in Shanghai, and XD Inc., which is listed in Hong Kong.

After a year-long crackdown that started in late 2021, when Beijing imposed strict limits on the amount of time that minors could spend playing games each week and began an eight-month freeze on new game approvals, China’s gaming industry has been gradually recovering. The result was that the industry faced difficult economic and regulatory circumstances in 2022.

According to a report released in January by the nation’s semi-official gaming industry association, video game sales in China dropped over 10% to 269.5 billion yuan (US$39.6 billion) in 2022, the first decline in at least two decades, with the number of gamers falling 0.33 percent to 664 million.

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