Games

Tencent’s profit fell for the first time in ten years as a result of suspended certification of games in China

               

The reason for the delay was the restructuring of local regulators.

On August 15, Tencent published a financial report for the second quarter of 2018, from which it turned out that the profit of the Chinese company fell by 3% compared to the same period last year – for it is the first deviation in the last ten years. It was caused by the suspended certification of games in China, caused by the restructuring of local regulators – it began in March.

As explained by analytical firm Nico, due to the stopping of the process of issuing certificates in March, the number of releases of games in the Chinese market in the second half of the year is likely to decrease. At the same time, the suspension of the process affects not only the release of titles, but also the ability of publishers to profit from the monetization of already released games. For example, with the mobile version of PlayerUnknown’s Battlegrounds in the case of Tencent.

Publisher Martin Lau at a meeting of investors said that at the moment Tencent has no idea when regulators will resume the certification process, but he is confident that it is a matter of time. The problem is that even if it happened immediately, the approval of the game releases takes, on average, several months and usually takes place in advance.

The situation is aggravated by the fact that the regulators not only suspended their work, but also generally tightened the “pass-through” rules. According to anonymous representatives referred to the Bloomberg publication, inside the approving authorities are increasingly worried about violations of the law on gambling and cruelty. The latter could have caused the Chinese authorities to complain about Monster Hunter: World, which Tencent was forced to remove from its service WeGame – the game is dedicated to hunting wild creatures.

Despite the fact that the delay in the work of the regulators began in March, Tencent’s report of August 15th actually became its first official confirmation. Representatives of the authorities, apparently, are forbidden to publicly discuss the situation – for this reason, comments to the Bloomberg publication were given only with due regard for the anonymity that has been preserved.

At the same time, the company is confident that they will still be able to “get through” and continue working in the normal mode. Until then, Tencent will only have to put up with the fact that even PC versions of PlayerUnknown’s Battlegrounds and Fortnite, one of the most popular games not only in China, but around the world, have not received full certification in China.

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