It appears that China has finally eased up on the gaming regulations as the country's two publishing giants, Tencent and NetEase, got new game licenses after nine months of uncertainty. Fortnite and PUBG, however, have to wait a bit longer.
The State Administration of Press and Publications (SAPP) published a list of 95 games that have been approved on 13 January 2019. This is said to be the fourth round of the government's approvals, with Tencent and NetEase finally being let off the proverbial hook.
Having missed out on the earlier SAPP approvals, Tencent received a clearance to publish two games - one on designing wooden furniture, while the other is about traditional folding fans.
NetEase received a single clearance but the fact it's a roleplaying game suggests they had better luck than Tencent, even though cultural differences often make these analyses more like shots in the dark.
Unfortunately for Tencent, neither Fortnite: Battle Royale nor PUBG found themselves among the approved titles in this round. When you consider that Fortnite has raked in $455 million in 2018, $69 million of which came in December 2018 alone, the company's situation and the state of the mobile become apparent.
In fact, Newzoo's report from November 2018 saw a disappointing mobile gaming performance in the first half of 2018, which has almost exclusively been blamed on China's regulatory issues. Mobile's losses have been offset somewhat by impressive console performance, but mobile forecasts had to be revised quite a bit.
All the parties involved remain optimistic that SAPP will pick up the pace in the following months, with 2-3 thousand licenses expected to be approved annually. Considering that both Tencent and NetEase took quite a few financial hits during the ordeal, we hope this is indeed true.
Tencent have reacted quickly following the Chinese government's concerns, even policing gaming time and announcing face recognition checks, all to comply with the regulations. Hopefully, 2019 ends up being kinder, which should be a certainty once Fortnite and PUBG are approved.
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