China’s Gaming Regulations Report
Download PDFNov, 2022 Analyzing the Consumer and Market Impacts of Chinese
Games Market Policies
N ovember 2022
© Newzoo 2022
The regulations come at a time when China’s
games market —the largest in the world by
spending and player numbers —is reaching
unprecedented heights . China -based game
companies have grown to be among the largest in
the world and are brimming with talent .
Prompted by regulations in their home market,
these companies have invested in (and expanded
into) ,with notable success
from ’s and ’s
Meanwhile, non -local game companies are hoping
to tap into China’s massive games market but are
struggling with the unpredictable regulatory
environment .
In this report, we summarize the regulations from
the past decade, highlight key learnings from
China -based companies’ international strategies,
and identify opportunities for international
companies looking to enter China .
Although young generations in China typically
enjoy and accept gaming, the media, government,
and older generations —especially parents —often
label games as that negatively
influences young people . In August 2021 , the
Chinese government released strict regulations to
limit play time for gamers under 18 years old,
aiming to .
These 2021 regulations were the latest in along list
of governmental efforts to control
and .
However, the inconsistent implementation and
enforcement of many policies have left China’s
games market in a state of .Many
regulations are not standardized . Others are
implemented differently from their initial
announcements, leading to subjective decision –
making by enforcers . Local interpretations of
regulations can also differ .
, where many games operate without
official licenses .
China remains the world’s biggest games market by revenues and players in 2022, but regulatory challenges remain
2
of 2022’s global games
market revenues will come
from China.
–China Market Analyst
–Mobile Market Lead
–Lead Analyst Games
–Market Analyst & Writer
–Editor in Chief
–Lead Visual Designer
Source: © Newzoo | Global Games Market Report | November 2022
Timeline & Key Developments 5
Regulations on Minor Protection 6
Regulations on Game Licenses 9
Unregulated Areas Across Mobile, Console, PC, and More 12
Regulations on Live Streaming 16
Compliance and Self -Regulation 20
Live Game Strategy 21
Overseas Expansion 22
Overview of Approved Imported Games in China 25
Opportunities for International Developers 26
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Timeline, key developments, and unregulated areas across platforms
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Since the early 2000s, the Chinese government introduced increasingly strict regulations to control China’s games market
5
Due to organizational restructures, the Chinese government from March to December 2018.
The government introduced the first official rule for online games, requiring to acquire licenses to operate.
Since 2000, the fast -growing games market drew the Chinese government’s attention to potential negative influences of gaming addiction among young people in China.• In 2000, the government in China. • In 2002, it requested that (at the time PC)before publishing. • From 2005 to 2007, the government asked large game companies to develop an to minimize play time for minors under 18 years old. Due to technical challenges, companies failed to fully implement these systems.
Following the significant growth of mobile gaming, China’s government required to be approved before publishing.
A nine -month started in July 2021, reportedly to further restrict the game approval process
The maximum in-game spending for minors from 8 -16 years old and 16 -18 years old was set to and , respectively.
Online game companies can only allow minors under 18s to access games
.
The government on game console s. Through partnerships, and could release special versions of game consoles in China.
Minors (under 18s) were as in-game rewards were reduced by 50% after three hours of play. Rewards were removed after five hours of play. The penalty period reset after five hours of no play time.
Previously, publishers launched their games via ‘’betas’’ to bypass regulations. In 2011, online games were with in – game purchases before attaining a license.
Both PC and mobile game players are required to register with their real -name identifications for the .
Game Licenses
Minor Protection
General
Before 2010 2017 2011 2018 2015 2021 2019 2014
The government developed an for game companies to verify player identities.
2012 2013 2016
Minor players under 18s were allowed to play a maximum of and .
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Anti -addi ction draws high attention
from regulators; minor protection is
the key regulation focus in China.
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China now officially covers game anti -addiction regulations in its newly revised minor protection law
7
’s Chinese website shows the CADPA rating icon at the left corner
• Game companies can only provide game services to minors under
18 years old between 8 PM and 9 PM on Fridays, Saturdays, Sundays, and
holidays .
• The maximum monthly in-game spending for minors from 8-16
years old is CNY 200 ($30 )and CNY 400 ($60 )for 16 -18 years old .
• All game companies are required to integrate areal –
name verification system into their game anti -addiction system .
• Live -streaming platforms must feature a special “Youth
Mode” to protect minors from game addiction and inappropriate content .
Minors under 18 years old are not allowed to spend money on streaming
platforms .If they do, platforms must refund the money to their guardians .
Minors aged between 16 and 18 can stream under their guardians’
supervision .Read more about live -streaming regulations on page 16 .
• Professional players under 18 years old are not allowed to compete
in any official tournaments .
• Platforms that rent or trade game accounts
are banned from providing their services to minors under 18 years old .
• In 2020 ,the China Audio -Video and Digital Publishing Association (CADPA)
released an age rating guideline for games published in China .The CADPA rating
system (8+, 12+, 16 +) in China only serves as a for minors and their
guardians .Earlier government announcements suggest the age rating system is
based on categories including , , ,
, , ,and .
• The CADPA rating system was treated as a pilot test .Now, publishers must
.The
CADPA rating icon must also be present on the game download/purchase page
and in all game promotional materials .
Source: League of Legends: Wild Rift
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• The anti -addiction regulations only in China in
the short term .Reportedly, the share of minor spending is small (below 2% in 2021 ).The
table on the right summarizes the reported minor spending shares from leading public
game companies in China .
• When they are unable to play, some minors likely turn to watching
to stay engaged with their favorite games .
• Following the regulations, several (especially for )
to make sure all the players were above 18 years old .
• The regulations on minors mean gaming may
in China, negatively impacting the Chinese gaming market in the future .
• may also be affected implicitly due to fewer players being engaged
(meaning lower player bases) .
• and platforms will bear the costs of anti -addiction measures and
might even ,ultimately leading to fewer resources for
content and therefore less opportunity for players to engage .
• may be less willing to invest in China’s games industry, seeing itas risky .
• China may become with a limited esports talent
pool, potentially leading to in the long run .
However, the regulations are likely to cause negative effect in a longer term
8
2020 6% from players under 18
3.2% from players under 16
2020
Annual Report
2021 1.5% 2021
Annual Report
H1 2021 <1% Q2 2021
Investor Call
H1 2021 Around 1% Q2 2021
Investor Call
H1 2021 0.009% (Shengqu Games only, a company under Century Huatong )
Shengqu Games
Weibo Account
2021 0.025% 2021
Annual Report
H1 2022 0.0029% 2022
Interim Report
2021 0.055% from players under 18
0.016% f rom players under 16
2021
Interim Report
Source: Public Financials
Among Leading Chinese Public Game Companies
© Newzoo 2022
The game approval process in China is
challenging, time -consuming, and
highly uncertain.
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A lack of regulatory clarity makes publishing and operating games difficult in China
10
W hen applying for game licenses ,game companies needed to file that included
information about the publishers, game screenshots, all game scripts, real -name verification systems, a list of
prohibited words in the game, etc .Notably,
.For example, with monthly updates,
added more than 90 ,000 characters to its list of prohibited words .In April 2021 ,China updated the
rating system for its game approval process .The new rating system covers five categories :
• Whether the game matches the government’s societal values, worldview, and view of
history .
• Encourages games to use innovative game design .This rule prohibits games that blatantly
copy existing titles .
• Refers to agame’s quality and artistry .
• Whether the game can educate players on Chinese culture and scientific knowledge .Any
mistakes or errors in the text or graphics will lead to points deducted .
• Whether the game is acomplete package and can run smoothly .
At least two experts evaluate each game based on the above categories .Each category gets ascore between 0
and 5;the game’s overall score is the average of the five categories .The scoring will be rounded to +/ -0.5based
on ageneral review ,so
In other words, only games with an average score of 3or above will be approved .
For example, Fate/Grand Order (a popular card battler game) was required to change the
names of in-game characters based on Chinese history/literature in order to reduce the connections between
game characters and Chinese history/literature .
For game companies that publish games without game licenses, or that use other games’ licenses, the government
is entitled to and fine the game company’s operating revenues .
Due to regulation pressure, renamed to
,changing the game setting
from a warzone to a military training exercise . The game
removed blood, instead giving players four different smoke
colors to choose .
had to postpone a new character cosmetic,
because the character rode amotorcycle in adangerous way
(a potential bad influence) on teenagers .Later, Tencent
updated the skin with helmet and vehicle registration plate .
Source: Honor of Kings ; Peacekeeper Elite
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M any game companies reportedly laid off or dissolved their gaming departments
2017 2018 2019 2020 2021 2022
Imported Games Domestic Games
11
Mobile Game Licenses in 2021
PC Game Licenses in 2021
Console Game Licenses in 2021
Before the in 2018 ,the game
approval process was relatively fast and easy .
Following the nine -month license freeze ending in
December 2018 , game approvals have become
significantly stricter in China .
During from August
2021 to March 2022 ,there were reportedly
in H22021 .As of September
2022 ,the game approval process still has not fully
recovered .
Notably, at the time of writing,
,signaling that the situation is
getting more challenging for foreign companies
looking to enter China’s games market .On top of
acquiring a game license, foreign companies must
partner with aChinese entity to launch and operate
their games .
By 2022 ,China may start to the approval
process from the central government to several
(including and ).This
will potentially as
more people can contribute to the process .Notably, a
license obtained in aFree Trade Zone is applicable
across the country .
Source: National Press and Publication Administration (NPPA)
By National Press and Publication Administration (NPPA) | *As of Octobe r2022
Note: The per platform game license analysis for 2021 (right) doesn’t add up to the total game numbers (left) because a cross/multi -platform game in China only receives one license while it is counted double in the per platform analysis. We do not deduct the licenses that were revoked by NPPA.
© Newzoo 2022
China’s players and publishers are
continuing to find workarounds for the
strict regulatory environment, but
there are risks.
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Many unapproved games are still available via Steam, VR, and cloud platforms
13 Source: Steam Hardware & Software Survey
During the period from August 2017 to April 2018 ,Valve
discovered that users from became
more prominent in the Steam Hardware Survey .
The main driver for the sudden increase in cyber café
users here was the massive success of in China at
launch on Steam . Due to the
to play PUBG, many Chinese players chose
to access the game via cyber cafés .
Five years after PUBG’s global launch,
.
• Despite lacking the license to operate, at the time of writing
(October 2022 ).Most Chinese players use a (a service that provides stable and fast
internet connections for Chinese players to access games on international servers) or for a
smoother gaming experience .Steam also allows players to pay in CNY via online payment services
including and .Players in China can also access many unapproved Steam games via
and .
• Faced with tightening regulations in the domestic market, Chinese game studios (including small -to –
medium ones) choose to publish on Steam first before acquiring game
licenses .For example, sold 2million copies one year after its early access release .
• However, in September 2021 ,213 Chinese game companies established
like Steam .It may become
difficult for games published on Steam to acquire game licenses .
• Steam titles like and achieved massive success in China .One of the advantages
these games have for the Chinese market is that they .
• : ,partnering with ,officially launched in February 2021 .
On the launch day, the platform only provided 53 titles —and without community features .The release
of Steam China provoked around apotential in the future .
• At the end of 2021 ,China unofficially banned Steam for around a month, when many
players were unable to access Steam’s store .The connection to Steam is often unstable in China .
• ,one of the most used game accelerators in China to access
Steam, announced it would cancel its service in May 2022 .However, other popular game accelerators
such as ,still work .
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Wild Rift Revelation Devil May Cry: Peak of Combat
Battle of Golden Spatula Doula Continent: Awakening Soul Yi Nian Xiao Yao
Mole’s World Endless Notes Tower of Fantasy
Harry Potter: Magic Awakened Komori Life Stacky Dash
One Piece Fighting Path Wang Lanmei’s Happy Life
Doula Continent: Soul Master Duel Chimera Land
Jade Master Ball Run 2048
Paper Bride Landlord Simulator
Giant Rush! Ace Racer
MARVEL Super War Yu -Gi-Oh! DUEL LINKS
Only premium mobile games or games featuring in -app purchases (IAPs) require approval
games without licenses (IAA) games with licenses (IAP or hybrid)
• All mobile games or games
featuring must
obtain a game license before publishing .However,
games that monetize only via
ads , according to current
regulations .
• Monetizing solely via ads is just one way to circumvent
regulatory requirements . As there are thousands of
mobile games available on the market, regulators may
overlook
.Some apps label themselves as “entertainment”
apps (instead of “games”) to bypass regulations .
• In June 2022 ,China’s
fined three IAA games for not having game licenses for
the first time .Regulators confiscated all game revenues
and removed games from the app stores .It signals
.
Among Top 100 Titles in China by Downloads | iOS | 2021
14
Among the top 100
mobile games in China
by downloads in 2021 ,24
were released in 2021 .
Among the 24 new
mobile titles, seven were
published without game
licenses .These six games
only generate revenues
from in-game ads .
Source: National Press and Publication Administration (NPPA) ; Airnow Data
© Newzoo 2022
Most console players in China buy overseas consoles (rather than the official Chinese ones)
15
2014 2014 2019
BestTV Oriental Pearl Group Tencent
Xbox Live Gold
(CN Version)
PlayStation Plus
(CN Version) N/A
12 30 32
Through the
,Sony supports
local game developers in China
to build games on PlayStation .
Some notable examples include
and .
Although the China Hero
Project has drawn much
attention among Chinese
console developers, many
games must go through a
to get approved
by Chinese regulators .
• In 2014 ,the Chinese government .
Since then, console manufacturers can officially produce and sell game
consoles —as well as console games —in China via creating a
with Chinese companies .
• Due to the country’s strict approval process, only a few games are
available on the official Chinese versions of consoles .Therefore, it is very
common for players to purchase games and consoles from Japan or Hong
Kong via the (e .g.,e-commerce platforms such as Taobao and
JD .com) .
• To reach more games and services, players who purchased the official
Chinese versions of consoles have also found various ways to
to access the global market .
• China has cracked down on unapproved
games/consoles imported from other markets for years .Now, it is getting
more and more difficult to buy consoles and boxed games on the
secondary and grey market .
• China may ban the on game consoles .The
current backdoors on the Chinese versions of consoles still allow players to
access international servers and download unapproved games .Earlier in
2020 , was forced to disable the backdoor on PlayStation 4,but
players quickly discovered anew workaround .
Xbox, PlayStation, and Nintendo
Source: Xbox ; PlayStation ; Switch ; National Press and Publication Administration (NPPA)
© Newzoo 2022
Game live -streaming platforms face
regulation pressure in China, but there
are currently many workarounds.
© Newzoo 2022
However, not all rules have been fully implemented by game live -streaming platforms
17
• online TV
broadcasts, live -streaming services, short -video platforms, or any other audio –
visual platform .
• Although this regulation is official, .
• The only games that live -streaming platforms have banned, as requested by the
government, are including ,
,the franchise, and others .
• Minors under 18 years old are
(e .g.,via donations or subscriptions) .
• Only .
• Streaming platforms must feature a for minors under 18 years old
to watch .The Youth Mode restricts inappropriate content, spending, and
engagement with streamers and other viewers .It also limits the daily watching
time to .Excess watch time requires guardian approval .Minors are
not allowed to use streaming platforms from .
• However, there is on steaming platforms
as in online games, meaning that it is easy to bypass the regulations on
streaming platforms .
one of the largest game live -streaming platforms in
China, has featured aYouth Mode since late 2019 .
Parents/guardians can set up the Youth Mode with a
password .This password is required to exit or bypass the
Youth Mode (see below) .
Source: Huya
2 3 1
Once the Youth Mode is switched on, the user must enter the correct password to the mode .
Ifthe user wishes to access streaming content from ,the password isrequired .
Under the Youth Mode, the user isonly allowed to spend watching every day .Once the time limit is reached, the app will be locked by the password .
© Newzoo 2022
It is more challenging to regulate live -streaming platforms compared to online games
18
• Popular unapproved games (including and )are still available on live –
streaming platforms .Some streaming platforms renamed PUBG to a different category .
There have been no further regulations since the first announcement .
• Nowadays, non -live -streaming clips and other edited videos are trending on video -sharing
platforms .Although games like are banned from live streaming, its
Itseems that VOD content is not included in the regulations .
• Due to minor protection rules, streaming platforms must any spending by minors
under 18.Streaming platforms and streamers have to bear extra costs during the refund
process .
• is far more popular than gaming content on streaming platforms, so
China’s regulators mainly target
such as pornography and violence .
• It is difficult to for streaming platforms to monitor streaming content when facing
thousands of streamers at the same time .When streaming platforms try to hide popular
titles, regulators may also
every day . Moderating a never -ending influx of content is hugely
challenging, especially for those unfamiliar with gaming .
• As most streaming platforms are accessible via (instead of apps) without having
to log in,users can easily bypass the regulations .
While has not been officially approved in China, streaming
platforms still allow PUBG content due to its high popularity .These
platforms have renamed the game to bypass regulations .Because of
PUBG’s slogan “WINNER! WINNER! CHICKEN DINNER!”, “chicken
game” often refers to PUBG in China .
VOD platforms are still allowed to feature content from banned
games. For example, ’s tutorials and streaming clips
are still available on (bel ow) .
1
2
Source: Bilibili
© Newzoo 2022
Strategies in the domestic market and overseas expansion
© Newzoo 2022
Game companies must bear extra costs created by the regulations, including content moderation
20
Tencent brands Roblox China more as an that
helps children develop programing mindset and skillsets.
In May 2019, announced a
partnership with to launch
Roblox China via a joint venture.
By July 2020, the global version of
Roblox was no longer available in
China.
In July 2021, Tencent officially
launched Roblox China.
was banned in China due to the
prevalence of political UGC in the game .
• Game companies voluntarily promote
like traditional cultural heritage and medical technology .For example, at ’s
annual game conference SPARK 2022 ,the company announced its partnership with a
subsidiary for aflight simulation system, powered by Tencent’s game technology .
• Larger game companies including , ,and are
starting to feature facial recognition technology to verify whether players are using their own
identification .
• Tencent register ed apatent allowing it to easily identify players by utilizing
player location data .Ifauser is detected in aschool area when logging in to agame, the user will
be asked to verify his/her identity . This location -based verification system improves the
efficiencies for Tencent’s game anti -addiction measure s.
• UGC -based games like and need game content
to be reviewed (automatically via an algorithm or manually) for several rounds . stated
that the company planned to recruit 300 -350 employees to review content by the end of 2022 .
Content moderation is always the priority for games like Roblox and Minecraft in China .
• There are administration managers monitoring and browsing all streamers 24 /7 to
avoid inappropriate game/streaming content on their platforms .
Source: Animal Crossing
© Newzoo 2022
Publishers need just one license for multiplatform games, driving game companies to develop titles for various platforms
21
iOS | 2021 • Due to the limited number of new games approved in China, game companies choose
to and build them as .
• Chinese companies are a market leader in F2P (mobile) games, in terms of
development, monetization, and operation .The tightening local regulations are further
fueling this trend .It is now very common for games to feature regular updates, season
passes, time -limited PVP/PVE events, IP collaborations, and more .
• Long -term LiveOps leads to high retention and stable revenue streams from loyal
players .Airnow data shows that 50 % of China’s top 50 grossing mobile games in 2021
(iOS only, see right) were released prior to 2019 ,and 15 games have already operated
for ,including by and
by .
• Mobile games in China are becoming ,featuring advanced graphics and
complex combinations of game mechanics .The game design is sophisticated enough to
support aregular stream of new content .
• Technological advances in mobile game development makes it possible to launch
games across .Notably, games were required to apply for aseparate
game license for each platform (e .g., had to apply for three licenses for
as across -platform game) .However, China now allows
to meet the latest market trend .This also streamlines the approval
process .
• Multiplatform development is efficient in terms of adhering to the regulations .
.
Source: Airnow Data; National Press and Publication Administration (NPPA)
Before 2016 2017 2018 2019 2020 2021
By National Press and Publication Administration (NPPA)
1,365 0 0 0
1,308 3 0 0
679 6 1 1
© Newzoo 2022
Genshin Impact miHoYo 2020 4
PUBG MOBILE Tencent 2018 5
Lords Mobile IGG 2016 39
State of Survival: Zombie War FunPlus 2019 16
Top War: Battle Game Topwar Studio 2019 35
Rise of Kingdoms Lilith Games 2018 28
Mobile Legends: Bang Bang Moonton 2016 54
Project Makeover Magic Tavern 2020 29
Evony Top Games 2016 43
Mafia City Yotta Games 2017 32
China is hoping to conquer the global mobile market with diverse game themes and complex gameplay
22 Source: Game Publishers Association Publications Committee (GPC) of China; Airnow Data
2018 -2021
2018 2019 2020 2021
iOS & Google Play | G lobal Market Excl. China | 2021
2018 -2021 CAGR of Chinese game companies’
revenues outside of China. During the same
period, the CAGR for global mobile game
revenues is , meaning
.
China’s game companies are
gradually leading the global mobile
games market .In the early years,
Chinese companies mainly targeted
the Western market with
or
.
Now, we are seeing more successful
Chinese games across variety of
genres . For example,
has innovated meta play in
match -3 to the next level ;open –
world mobile games such as
have achieved massive
success in both China and overseas .
Moreover, Chinese developers have
accumulated rich experience in
operating in the F2P era
and they are bringing this expertise
to the international market .Several
international game giants have
partnered with Chinese developers
to transfer their game franchise sto
mobile, such as
(Tencent) and
(NetEase) .
© Newzoo 2022
China’s leading game companies are acquiring development talent and setting up overseas studios and publishing divisions
23
• Besides growing their own games outside of their home market, China –
based game companies are by
investing in game studios all over the world .
• Companies such as Tencent and NetEase have established game studios
in North America (e .g.,Los Angeles, Seattle, Montréal )and Asia (e .g.,
Tokyo , Singapore) . Their goal is to create games developed by
international teams likely to appeal to audiences in the global market .
• Due to cultural differences and language barriers, many Chinese
companies struggled to publish games in the international market .In
addition to establishing international development studios, now, Chinese
companies are .Level Infinite
(Tencent) and Farlight Games (Lilith Games) also publish games for other
small -to -medium Chinese game studios in the overseas market .
2022 Ubisoft €300 M 9.99% Assassin’s Creed Adventure
RPG
2022 From
Software N/A 16.25% Elden Ring, Dark
Souls Action RPG
2022 Triternion N/A Minority Mordhau Hack and
Slash
2022 Sybo N/A Acquisition Subway Surfers Arcade
2022 Tequila
Works N/A Majority Rime Adventure
Puzzle
2022 1C
Entertainment N/A Acquisition King’s Bounty Turn -based
RPG
2022 Inflexion
Games N/A Acquisition Nightingale Open -world
Survival Craft
2021 Sumo Group $1.25Bn Acquisition Game Development
2022 Quantic
Dream N/A Acquisition Detroit: Become
Human
Interactive
Story
2021 Kepler $120Bn Minority Sifu Fighting
2021 Moonton $4Bn Acquisition Mobile Legends:
Bang Bang MOBA
© Newzoo 2022
Challenge & opportunities
© Newzoo 2022
Nevertheless, winning a niche market in China could lead to considerable revenue, thanks to the massive Chinese audience
25
• Imported games approved by NPPA refer to
.For example, Call of Duty :Mobile is developed by Tencent,
but since its original IP is foreign, the game still categories as an imported game .In order to
publish games in China, international game developers must partner with alocal publisher .
• Of the 76 approved imported games in 2021 ,55 are mobile titles, 11 are PC titles (one also
has aconsole game license as cross -platform), 10 are console games (see page 15).As China
is a mobile -first market, it is not surprising that there are much more mobile games
approved by NPPA .
• There is much less room to bypass regulations with amobile game than via grey markets
like PC/console games .The imported PC/console games approved mainly serve to expand
like WeGame by Tencent or
like PlayStation and Switch .
• After one year of being approved, nearly
.Two games that were published earlier ( by
and by ) have already stopped operating due to poor
performance . ,
including the long -anticipated PC game .
• The biggest challenge for imported games is .Getting agame license is already avery
time -consuming process with high uncertainties .On top of that, games often need to test
for several rounds to ensure smooth operations, including adding localization features and
real -name verification system .Today’s gamers demand engaging with their favorite games
as soon as they are released .Therefore, with the time -consuming approval and localization
process, it is becoming increasingly
.It is often more economical to launch international
games via China’s grey market but may carry risks for games not being officially approved .
By National Press and Publication Administration (NPPA) | 2021
iOS & Android Only Android Not Released Stop Operating
By National Press and Publication Administration (NPPA) | 2021
PC PlayStation 4/5 Nintendo Switch Not Released
Source: National Press and Publication Administration (NPPA)
*Including games approved on multiple platforms.
© Newzoo 2022
Games based on popular PC/Console franchises are more likely to succeed
26
• Due to its massive user base and relatively low entry barrier for (domestic)
developers (compared to other gaming platforms), China’s mobile gaming market is
among the most competitive games markets in the world .
• To have achance at making it to the top of the grossing charts,
.Particularly, game franchises
such as and are popular in China, as game franchises can
bring the core gameplay loop and game theme to players, whereas non -game
entertainment IPs need to build up an immersive experience for players from the
ground up .One successful non -game IP example is
by itfeatures high -fidelity graphics and storytelling videos to facilitate the
IP adaptation .
• When the (game/entertainment) IP is well known in China, IP-based games often do
not require much and can easily break the culture barrier
with unique IP advantage . Nevertheless, Western comics have never been
mainstreaming in China ;therefore, we see a relatively weaker performance of
.
• For non -IP-based games developed by foreign game companies, existing
and are unlikely to match perfectly to the preference of Chinese player,
that, for example, much prefer an art style .For example, by
achieved success in the casual genre in the international market but failed to
secure asimilar position in China .
• is always a challenge in the highly competitive mobile market .
Partnering with mobile publishers such as and makes it easier for
imported games to access players via localized advertisements, social media, and
other marketing activities .However, these top publishers will often ask for alarger
revenue cut .
China | iOS | August 2022
Diablo Immortal NetEase July 2022 3
League of Legends: Wild Rift Tencent October 2021 10
League of Legends: Esports Manager Tencent July 2022 7
Digimon: New Century Tencent October 2021 129
Guardian Tales Bilibili April 2021 200+
World Flipper G-bits October 2021 300+
Might & Magic: Era of Chaos Tencent June 2017 200+
Pokémon Quest NetEase May 2021 400+
Marvel Duel NetEase September 2021 500+
Merge Dragons! MyGamez November 2021 300+
Source: National Press and Publication Administration (NPPA) ; Airnow Data; Qimai Data
IP-based mobile games
© Newzoo 2022
Video content is one way to reach Chinese players, who often access unapproved games via workarounds
27
• China has alarge grey market for PC and console despite all regulations (read page 12-15
to learn more) . Therefore, every niche gaming market could potentially generate
considerable revenue via massive player numbers .Besides
,game companies can also reach out to on live -streaming/video –
sharing platforms or among other online game forums to promote games in China .
• Among all game influencers in China, have always been considered as the most
impactful ones, which is also one of the biggest drivers promoting unapproved games to
Chinese gamers .One success story is ,allowing China to follow the battle royale
trend as the rest of the world (despite that PUBG still awaiting approval) .
• Chinese viewers typically enjoy games where streamers can actively interact with other
streamers or viewers .Games under
are more likely to trend on streaming platform .
• These days, VOD platform (equivalent to YouTube in China) is getting increasingly
popular among gamers, attracting a massive amount of game content on the platform .
Influencers have played an important role in introducing diverse game genres to Chinese
players .Some notable examples include and .
• Despite many restrictions on the Chinese version of game consoles, Chinese players are
still motivated by word -of -mouth marketing as players in the rest of the world to access
unapproved games such as . displays a few
unapproved games on its Chinese website for promotion but stated “games are still in
development ;the official game release will be limited to Chinese regulations” .
• While entering the Chinese market via official ways has many challenges and
uncertainties, it may still be worth it for game companies to enter China’s grey game
market by
2017 Krafton Battle Royale 21.6M
2017 Bennett
Foddy
(Precision)
Platformer 8.3M
2018 Sony (Interactive Story)
Adventure 15.0M
2018 InnerSloth (Social Deduction)
Arcade 14.5M
2019 Other Ocean
Interactive
(Social Deduction)
Arcade 12.7M
2020 Epic Games Battle Royale 4.9M
2020 CD Project Action Adventure 10.8M
2022 Bandai Action RPG 17.0M
2022 Digital
Confectioners
(Social Deduction)
Arcade 2.7M
Top Viewed Video on Bilibili | As of September 2022
Source: Bilibili
© Newzoo 2022
Operating a game in China —whether officially
or through the grey market —comes with a
complicated regulatory environment, and none
of the options guarantees the ability to operate
in the future .The past years have shown that
regulations change, generally towards
strictness .
In this report, we summarized and analyzed
regulations and information disclosed to public,
hopefully presenting some insights for
companies to have a better understanding of
the China’s current regulations .As regulations
can be consistently changing and sometimes
unclear, people in the industry often have
different interpretations to the regulations and
rules .
If you have any different opinion or thought,
please feel free to reach out to us for future
discussions .
Since the
beginning of the 21st century, the Chinese
government has been regulating its games
market, but this has not (and will not) stop
Chinese game enthusiasts from accessing the
games they want to play .
Securing a license to operate through the
official approval process is the correct and
safest way to enter China’s game market .
However, as the process is time -consuming and
highly uncertain, game developers and
publishers should also consider other options .
When it is difficult to acquire game licenses,
is probably still the most feasible way for
game companies to bypass regulations and to
reach China’s huge audience . Besides
advertisements, promoting games through
player and streamer communities is an efficient
and effective way to market agame in China .
Notably, China’s
regulators have already noticed several
unregulated markets and workarounds .
Regulations are unpredictable, but many companies are leveraging unregulated markets and workarounds
28 Source: © Newzoo | Global Games Market Report | Novembe r2022
© Newzoo 2022
Global, regional, market key metrics
Market sizing, trends, forecasts
75,000 Gamers surveyed worldwide
Motivations, drivers, playing behavior
Games & Market Engagement Data
Covering Thousands of Games
PC, Console, Mobile, Viewership, Reddit
Player Demographics & Psychographic Data Trends, Market Sizing, Forecast Data
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