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Report: China freezes new game approvals as regulators tackle backlog

Report: China freezes new game approvals as regulators tackle backlog

February 20, 2019 | By Chris Kerr

February 20, 2019 | By Chris Kerr
More: Business/Marketing

Game approvals have once again been halted in China as the State Administration of Press and Publications (SAPP) attempts to clear the backlog creating by last year's nine-month licensing freeze.

As reported by the South China Morning Post, which claims to have information from a company executive with "knowledge of the matter," SAPP hasn't given any indication as to how long the new hiatus will last. 

Game companies will still be able to hand applications over to local regulators, but that's precisely where they'll stay until SAPP has worked through its backlog. 

It's a worrying report for developers and publishers in the region. The last freeze lasted for the majority of 2018, and came as the result of an internal power reshuffling that eventually saw SAPP take control of the approval process

Over that period, the Chinese video game market witnessed its slowest first-half growth in a decade, and heavy hitters like Tencent even felt the effects, with the company suffering a share drop of 5 percent in the back end of 2018

Since the turn of the year, over 350 games have received approval -- including some from main players Tencent and NetEase -- but now it looks like the country could be thrown back into limbo. 

"If the licensing process is halted for any reason more than to give the SAPP a chance to clear out the backlog, that will be a disappointment to game developers, publishers and gamers," commented Lisa Hanson, founder of market research outfit Niko Partners.

"The new freeze could possibly hurt publisher earnings if they need to endure a prolonged wait for their return on investment in titles in their pipeline that they had anticipated to be released in China already or in the near future. We are hopeful that this is a procedural halting and will soon be resolved."

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