Foreign Developers Can Only Hope to Reach China with Mobile Games - Here's Why

China recently approved 28 imported games to be released in the country. 24 are for mobile. And some of the select few are quite surprising. Let's take a look at the impact for developers, publishers, and gamers.

Article originally published on LinkedIn. Daniel Camilo is a business developer for Chinese game publisher APPTUTTi, based in Shenzhen, China.

China recently approved 28 foreign games to be officially launched in the country. That is, an ISBN Publishing License has been given to these games, and they can now be legally released and distributed by their corresponding publishers, with full range of monetization options available to them.

A lot to dig in if I was to comment on each and every single title, so I will highlight a few cases that I think are particularly interesting, and how we can read more broadly from them about the current state of the Chinese videogame market. Keep in mind that a Publishing license, takes anywhere between 6 months to a year to be approved, if approved.

Console Gaming is Dead, again. Kind of. But not really.

Of the 28 games approved, only one is a console game. After enjoying a huge surge in popularity in China in the early months of the year due to the COVID-19 lock-downs, Ring Fit Adventure is now cleared to be officially launched in China. Makes sense? Of course not.

Ring Fit Adventure China

During the first half of the year the demand for the game in China was so high, that at some points it was retailing (online, on Taobao) for more than double its original price. So why and how is the game only now being officially released? Notice I use the term “officially” very intentionally, and that is because most consumers in China buy imported consoles instead of the officially released version of the Nintendo Switch. I wrote extensively about the subject here, and here, but in short, imported hardware is extremely easy to acquire online, while the officially released one has all sorts of region-locked restrictions, and most well-informed consumers will actually avoid those.

It’s practically impossible to know and track how many imported copies of Ring-Fit Adventure were sold in China during the last few months in China, but if I had to guess, I would say at least a couple of hundred thousand, if not more. How many copies can we expect the officially released version of the game to sell? Considering the low sales of the Chinese Switch in China (as opposed to imported versions), I would estimate 30k units, at the most optimistic end of the spectrum. The approved version of the game will only work with the Chinese version of the Switch.

All this to say, only ONE foreign console game was approved in the last 5 months in China! The Xbox One and PS4 are also officially released in the country with their own versions, that carry their own set of restrictions. Similarly to the Switch situation, most consumers buy imported versions of those consoles as well, which as led to both Sony and Microsoft official presence in this market to be moribund, to say the least.

Mobile gaming is the only option for foreign developers and publishers

Of 28 approved games, 24 are for mobile. That much should be an indication of how one-sided the path has become for international game-makers who want to make it into China. This of course, applies to Chinese games as well, as the majority of approved titles are on mobile. Worth noticing that once a game gets the publishing license, the license is valid for all platforms the game is available on - as long as it is the same game, with the same content. So a mobile game with an approved publishing license can potentially be released on Android app stores, as well as iOS’s APP Store.

Call of Duty Mobile is coming to China! Wait, really?

Call of Duty Mobile China

For many, this might sound like an obvious thing. After all, Call of Duty Mobile is owned by Tencent (Chinese company) and has been one of the most successful games ever, racking up almost 300 million downloads since launch. However, I must admit I was surprised to see it cleared for release in China. In fact, a couple of months ago when expressing my thoughts on the subject to the SCMP, I was convinced the game would never be released in China.

Remember, Fortnite is not available in China. In spite of its cartoonish looks, lack of gory violence and being one of the most popular games in the world, Fortnite never became significantly popular in China and doesn’t have a license to be published. Also, it’s made by Epic, of which Tencent owns 40%! Considering all this, and the much more realistic/violent look of CoD Mobile, I felt confident in believing the game wouldn’t come to China. I was wrong, clearly.

What is really interesting in the CoD Mobile situation however, is that the game was initially released in October. That means Tencent actually applied for a publishing license for China as soon as the game was eligible for it. Apparently, the process took them 10 months. The game was always intended to be released in China, and the fact that no significant leaks about the plan came out since the initial global launch until now, is nothing short of astonishing.

Still, I wouldn’t be surprised if CoD Mobile gets banned from China in the future. Depending on its success, how the media portrays it, and the amount of exposure it gets, it’s very possible that backlash might hit it hard, eventually. There are just too many elements in this game that could rub “Chinese values” the wrong way (American militarism, war, realistic combat/violence, gun glorification...), and in my opinion, Tencent probably used its influence and muscle to make sure the game got approved. Just speculation on my part.

Sneaky EA and Star Wars

Star Wars Galaxy of Heroes China iOS App Store

Of all the titles approved, the one that most surprised me was Star Wars: Galaxy of Heroes. Until recently the game had no publishing license for China, although it was available on iOS in the country. Late last year (and earlier this year again) Apple announced that it would be removing games from the App Store in China that didn’t comply with Chinese regulations. In this case, games with IAP, paid-to-download and/or subscription based would require a publishing license. The deadline set by Apple was July, 2020. EA actually pulled out Galaxy of Heroes from the App Store before the deadline, leading most to assume the game could be gone from China for good. Lo and behold, Galaxy of Heroes is one of the games approved for release in this latest batch! Meaning, EA was planning for the move way in advance, and made sure to apply for a publishing license months before.

At this point it is important to understand (and once again emphasize) how challenging it is to get a publishing license for China, specially for foreign games. With Apple announcing it would remove games from the App Store less than one year ago, many games were caught completely off-guard. A Chinese partner is legally required to acquire a publishing license, and the license takes at least 6 months to get approved, but usually closer to a year. This left thousands of indie developers in a very vulnerable position, and scraping for solutions for the future of their games in China. It all worked out well for EA and Star Wars however...

Harry Potter and Warner Bros. in China

Harry Potter Warner Bros China

Last, but not least, I felt one of my eyebrows raise when I encountered Harry Potter: Magic Awakened among the select few foreign games approved for launch in China. Mostly because of the recent rumors surrounding the possible AT&T sale of Warner Bros. Interactive that everyone’s been talking about in the last month or so (you know, the one that could be worth $4B). I just wonder if whatever agreements have been signed between Netease (publisher of the game in China) and Warner Bros. (owner of the Harry Potter IP) include any stipulation in case the sale actually happens.

Oh, and PC games? Yes, 4 foreign PC games were approved as well. That’s as much as I have to say about that.

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