With a series of clampdowns and restrictions being the theme for Chinese companies this year, corporations were expecting slow or negative growth for many of the sectors. Property is already seeing the impact of such impositions while technology has gotten the brunt of the law from Beijing.
The gaming industry was also not spared, giants like Tencent have seen their market share diminish due to new rules by the Chinese government on user time spent on playing games. Age restrictions have also been introduced. Investors have been spoked by many of these changes and have shown their unhappiness on the stocks representing these companies. However, the latest reports released by the state agency point in the opposite direction, according to figures Chinese game companies are expected to see their sales revenue surpass 290 billion yuan (about 45.33 billion U.S. dollars) in 2021.
Of the total, over 230 billion yuan would come from the mobile game sector, said the report published by the game research agency CNG. This is a contrast as 2020 saw its gaming revenue reach US$43 billion and this was an upward trend due to lockdown measures and many youths resorting to their devices for entertainment.
Additionally, the report states that games independently developed by Chinese companies are expected to see sales revenue from the overseas market exceed US$17 billion this year.
Looks like the guideline put in place by the regulators is more of a ring-fencing rather than restricting the industry’s growth, the locals are unperturbed and mostly unaffected by the changes. In fact, many see it as necessary and applaud the government for doing so.
Signs are promising as the companies view a long-term strategy with a focus on increasing their revenue from the overseas market. The guidelines could be appealing for international markets as these companies become more conscious of welfare and their users.
