China’s long-awaited resumption of video game licence approvals may be too late for some smaller studios

April 20, 2022 GMT

The long-awaited resumption of video game licence approvals in China after nearly nine months of suspension might have arrived too late for some, with some smaller studios struggling to survive, according to a Chinese media report.

In the group of game developers to receive approvals this month are some that have made changes or encountered “abnormalities” in their operations, which could include a suspension of normal business operations or failure to perform certain corporate duties, Chinese tech media outlet 36Kr reported, citing business information portals including Qichacha and Tianyancha.

Nanjing Bochuan Network Technology, which was granted a licence on April 8 for a game that translates into English as Dreamy Puppies, was added to a list of companies subject to “abnormal operations” by the local market regulator last September. In this case, the regulator found that the company was unreachable at its registered address, according to Qichacha.

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Official websites for some of the companies granted new licences, such as Shanghai Binlue Network Technology and Nanjing Wuzhiwanyou Network Technology, are currently unable to be accessed. Several calls to these companies by the Post on Tuesday went unanswered.

Baidu, which this month received a licence for mobile game, has undergone a corporate restructuring during the approvals freeze, letting go of 100 employees from its video games unit, the Post reported. The Beijing-based company plans to significantly downsize its core games development team and terminate services to games developed by outside studios, two people familiar with the situation told the Post in December.

Baidu did not immediately respond to a request for comment on its plans for the new game on Tuesday.

China’s gaming industry breathed a collective sigh of relief after t he National Press and Publication Administration (NPPA) published a list of 45 newly-approved approved titles last Monday, ending a freeze imposed last July.

However, none of the newly-licensed games came from Tencent Holdings or NetEase, the country’s two biggest gaming companies, and the approval number of 45 is around half the 87 titles approved last July.

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The freeze, a few days shorter than the previous record, has dealt a heavy blow to the video gaming industry along with other measures aimed at bringing the sector to heel. China currently restricts gamers aged under 18 to playing between 8pm and 9pm only on Fridays, Saturdays, Sundays and statutory holidays.

Around 22,000 Chinese gaming companies have written off their business registration during the recent licensing freeze, up from 18,000 in 2020, according to a report by state-run newspaper Securities Daily last week citing data from Tianyancha.

This article originally appeared on the South China Morning Post (SCMP), the leading news media reporting on China and Asia. For more SCMP stories, please download our mobile app, follow us on Twitter, and like us on Facebook.

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