Game companies 263 days of "food shortage" days

Figure: Figure worm

Source: 21tech

Author: Poplar

Editor: Zhang Weixian

After more than 8 months, the game industry has finally ushered in a batch of new versions.

On the evening of April 11, the State Press and Publication Administration released the "April 2022 Domestic Online Game Approval Information", and a total of 45 games received the first batch of game version numbers in 2022. These include 5 client games, 1 Switch game, and the remaining 39 are mobile games.

The approved games include products from many well-known game manufacturers, such as Youzu Network's "Junior Three Kingdoms: Pocket Battle", 37 Mutual Entertainment's "Dream Voyage", Xishan Jushiyou's "Sword Net 3 Origins", Chuangmeng Tiandi's "Careful Fire Candle", Heartbeat Network's "Party Star", Lilith's "Life Party", etc., while Tencent and NetEase do not have products listed.

The game industry has been looking forward to the resumption of game version numbers for a long time, after all, there is no version number, which means that the game cannot be commercialized and the company cannot get revenue.

For the issuance of the next edition, some industry insiders told the 21st Century Business Herald reporter that the total amount will still be controlled. However, since the process of the suspension of the version number is still continuing, the process of sending new games for review is still continuing, so it is not excluded that after the version number is resumed, the number of releases may increase in a short period of time.

Days of "food shortage"

In 2018, the game version number pressed the pause button once, and that time lasted for 265 days. This time, the number of days the game version number was suspended was 263 days.

Although it is a few days less than the number of days when the version number is suspended, the situation of "lack of grain" this time is even more serious than the last time. Because since 2019, although the game version number has been released normally, the number is much less than before. For example, in 2021, the cumulative number of game version numbers issued is only 755, which is 54% in 2020, 48% in 2019, and only 8% if compared with 2017.

The most direct impact of the sharp reduction of the version number is to reduce the number of games that can be commercially operated, and the suspension of the version number has caused many companies without "grain storage" to fall into a state of "lack of grain", and the company's operation has also fallen into a crisis.

This can be seen from the financial data of some listed companies last year. For example, Tencent, even if it stores a certain number of version numbers, in the third and fourth quarters of 2020, the revenue growth of its local game market is only 5% and 1%, far lower than the previous level. For listed companies mainly in the game business, some of them recorded a sharp decline in net profit in 2021.

In response to the suspension of the game version number, some executives of the head game company said that the current regulatory authorities require the entire industry to increase investment in the protection of minors, and the industry is also doing this thing, and the release of the version number may also be delayed because of this.

In August 2021, the State Press and Publication Administration issued the Notice on Further Strict Management and Effectively Preventing Minors from Addicting to Online Games. The notice requires that all online game enterprises can only provide 1 hour of service to minors from 20:00 to 21:00 every day on Fridays, Saturdays, Sundays and statutory holidays, and may not provide online game services to minors in any form at other times.

In addition, the notice also requires online game enterprises to strictly implement the requirements for real-name registration and login of online game user accounts, and must not provide game services to users who have not registered and logged in with real names in any form.

This is also the strictest regulation issued so far for the protection of minors in the game industry. Subsequently, in September 2021, the relevant responsible persons of the Central Propaganda Department and the State Press and Publication Administration, together with the Central Cyberspace Administration, the Ministry of Culture and Tourism and other departments, also interviewed key online game companies such as Tencent and NetEase.

The interview stressed that all online game enterprises and platforms should strictly implement the requirements of the notice, implement the time limit for providing online games to minors to the letter, and must not provide online game account rental and sales transaction services to minors in any form. It is necessary to strengthen the review and control of online game content, strictly prohibit illegal and illegal content such as wrong value orientation, obscene pornography, and bloody terror, and resolutely resist bad cultures such as money worship, "mother's cannon", and "beauty". It is necessary to strengthen the control of "kryptonite", put an end to unauthorized changes in game content, illegal operation of games and other behaviors, resolutely curb the "only money" and "only traffic" and other erroneous tendencies, and make up our minds to change various rules and gameplay designs that induce players to indulge.

An industry analyst said that it is precisely because there are stricter and clearer requirements for online game content, so various manufacturers also need a certain amount of digestion time in the rectification of game content and subsequent game content review.

Forcing the industry to progress

With the recovery of the issuance of game version numbers, it also means that this round of adjustment of the game industry may come to an end, and the future will enter a new period of development.

Capital Securities pointed out in a research report that in the short term, the "anti-addiction" rectification has increased the difficulty of review, and regulatory standards have affected the pace of new games and marketing activities. In the early stage of industry adaptation, the new regulatory standards will have an impact on the timely launch and activity rhythm of some products, which will affect the flow expectations of related enterprises.

However, in the long run, strong game supervision is the main positive impact on China's game industry, which is also in line with the trend of high-quality national tourism research and development, long-term operation, and expansion of overseas travel. In particular, the total number control of the version number will enhance the cautious degree of game manufacturers in setting up projects, and "anti-addiction" and content review are more conducive to avoiding the young age and shoddy production of game products.

Therefore, as far as the local game market is concerned, the threshold for game content production will be higher and higher in the future, which is conducive to improving the quality of game content. The game industry's extensive growth method of blindly pursuing quantity and scale and despising quality brands has completely become a thing of the past.

In addition to deeply cultivating the local game market, the overseas game market is also becoming the choice of more and more game manufacturers. According to the "2021 China Game Industry Report" released by Gamma Data, in 2021, the actual sales revenue of China's self-developed games in overseas markets was 18.013 billion US dollars, an increase of 16.59% year-on-year. And from the average growth rate in the past five years, the share of mainland games going to sea is showing a steady upward trend.

In the third quarter of 2021, Tencent made it clear that it is increasing investment in global game development, while also building local publishing and operational capabilities to support business development in multiple regions. In the fourth quarter of 2021, compared with the low growth of the local game market, Tencent recorded a rapid growth rate of 34% in the international market, with a revenue scale of 13.2 billion yuan.

Sensor Tower's recently released "March 2022 China Mobile Game Publisher Global Revenue Ranking" shows that in March, a total of 38 Chinese manufacturers were shortlisted for the global mobile game publisher revenue list TOP100, with a total of more than 2.22 billion US dollars, accounting for nearly 40.2% of the global TOP100 mobile game publisher revenue.

Among them, with the launch of the new version of "Original God", Mihayou's revenue in the mobile market returned to the third place in the world, plus Tencent and NetEase, and the top 3 of the global mobile game publisher revenue list in March was once again covered by Chinese manufacturers. In addition, game manufacturers such as 37 Interactive Entertainment and Thunder Games also achieved a significant increase in revenue in March by virtue of the outstanding performance of their games in overseas markets.

The recovery of the game version number has effectively alleviated the urgent needs of domestic game manufacturers, but with the gradual implementation of new institutional designs such as total control, value guidance, and anti-addiction systems for the game industry, it also means that the competition in the game industry will further intensify. In the future, the position of those head high-quality manufacturers with the ability to develop and operate high-quality content, as well as the head research and development and distributors with the advantages of cultural overseas distribution, will be further consolidated.

Editor: Lu Taoran