China’s new rules on video games, , are having an effect on the country’s gamers. Today, Tencent replaced hugely popular battle royale shooter game PUBG with a more government-friendly alternative that seems primed to pull in significant revenue. The company introduced ‘Game for Peace’ in at the same time as PUBG — which stands for Player Unknown Battlegrounds — was delisted from China. The title had been in wide testing but without revenue, and now it seems Tencent gave up on securing a license to monetize the title. In its place, Game for Peace is very much the type of game that will pass the demands of China’s game censorship body. Last month, the country’s State Administration of Press and Publication released a series of demands for new titles, including bans on corpses and blood, references of imperial history and gambling. The new Tencent title bears a striking resemblance to PUBG but there are no dead bodies, while it plays up to a nationalist theme with a focus on China’s air force — or, per the message, “the blue sky warriors that guard our country’s airspace” — and their battle against terrorists. Game for Peace was developed by Krafton, the Korea-based publisher formerly known as BlueHole which made PUBG. Beyond visual similarities, that the games are twinned since some player found that their progress and achievements on PUBG had transferred over to the new game. Tencent representatives declined to comment on the new game or the end of PUBG’s ‘beta testing’ period in China when contacted by TechCrunch. But a company rep apparently told Reuters that “they are very different genres of games.” Tencent’s new ‘Game for Peace’ title is almost exactly the same as its popular PUBG game, which it is replacing [Image via Weibo]Fortnite may have grabbed the attention for its explosive growth — last year — but PUBG has more quietly become a fixture among mobile gamers, particularly in Asia. At the end of last year, that it was past 200 million registered gamers, with 30 million players each day. , PUBG grossed more than $65 million from mobile players in March thanks to 83 percent growth which saw it even beat Fortnite. There is also a desktop version. PUBG made more money than Fortnite on mobile in March 2019, according to data from Sensor Tower That is really the point of Tencent’s switcheroo: to make money. The company suffered at the hands of last year, and a regulatory-compliant title like Game for Peace has a good shot at getting the green light for monetization — through the sale of virtual items and seasonal memberships. Indeed, analysts at China Renaissance believe the new title could rake in as much as $1.5 billion in annual revenue, according to the Reuters report. That’s a lot to get excited about and resuscitating gaming will be an important part of Tencent’s strategy this year — which has already seen to focus emerging units like cloud computing, and
China’s Tencent disappointing profits in the fourth quarter on the back of surging costs but saw emerging businesses pick up steam as it plots to diversify amid slackening gaming revenues. Net profit for the quarter slid 32 percent to 14.2 billion yuan ($2.1 billion), behind analysts’ of 18.3 billion yuan. The decrease was due to one-off expenses related to its portfolio companies and investments in non-gaming segments like video content and financial technology. Excluding non-cash items and M&A deals, Tencent’s net profit from the period rose 13 percent to 19.7 billion yuan ($2.88 billion). The company has to date invested in more than 700 companies, 100 of which are valued over $1 billion each and 60 of which have gone public. Quarterly revenue edged up 28 percent to 84.9 billion yuan ($12.4 billion) beating expectations. The Hong Kong-listed company is best known for its billion-user messenger but had for year relied heavily on a high-margin gaming business. That was until a on games approvals last year that delayed monetization for new titles, spurring ain the firm to put more focus on enterprise services, including cloud computing and financial technology. Tencent has received approvals for eight games since China , although its blockbusters PlayerUnknown Battlegrounds and Fortnite have . The firm also warned of a ”sizeable backlog“ for license applications in the industry, which means its “scheduled game releases will initially be slower than in some prior years.” Video games for the quarter contributed 28.5 percent of Tencent’s total revenues, compared to 36.7 percent in the year-earlier period. Despite the domestic fiasco, Tencent remains as the world’s largest games publisher by revenue according to data compiled by . The firm has also gotten more aggressive in taking its titles global. Social network revenues rose 25 percent on account of growth in live streaming and video subscriptions. The segment made up 22.9 percent of total revenues. Tencent has in recent years spent heavily on making original content and licensing programs as it competes with video streaming site. Tencent claimed 89 million subscribers in the latest quarter, compared with iQiyi’s Tencent has been relatively slow to monetize WeChat in contrast to its western counterpart Facebook, though it’s under more pressure to step up its game. Tencent’s advertising revenue from the quarter grew 38 percent thanks to expanding advertising inventory on WeChat. Ads accounted for 20 percent of the firm’s quarterly revenues. All told, WeChat and its local version Weixin reached nearly 1.1 billion monthly active users. 750 million of them checked their friends’ WeChat feeds, and Tencent recently a Snap Story-like feature to lock users in as it vies for eyeball time with The “others” category comprising of financial technology and cloud computing grew 71.8 percent to generate 28.5 percent of total revenues. WeChat’s e-wallet, which is going neck-and-neck with Alibaba affiliate saw daily transaction volume exceed 1 billion last year. During the fourth quarter, merchants who used WeChat Pay monthly grew over 80 percent year-over-year. Meanwhile, cloud revenues doubled to 9.1 billion yuan in 2018, thanks to Tencent’s dominance in the gaming sector as its cloud infrastructure now powers over half of the China-based games companies and is following these clients overseas. Tencent meets Alibaba head-on again in the cloud sector. For comparison, Alibaba’s most recent quarterly cloud revenue was . Just yesterday, the ecommerce leader that its cloud business is larger than the second to eight players in China combined.
is summoning a big gun as it bids to develop its mobile gaming strategy. The Hong Kong-listed company — which sells laptops, smartphones and gaming peripherals — said today it is working with Tencent on a raft of initiatives related to smartphone-based games. The collaboration will cover hardware, software and services. Some of the objectives include optimizing Tencent games — which include megahit PUBG and Fortnite — for smartphones, mobile controllers and its Cortex launcher app. The duo also said they may “explore additional monetization opportunities for mobile gaming” which could see Tencent integrate Razer’s services, which include a rewards/loyalty program, in some areas. The news comes on the same day , which saw annual revenue grow 38 percent to reach $712.4 million. Razer recorded a net loss of $97 million for the year, up from $164 million in 2017. The big name partnership announcement comes at an opportune time for Razer, which has struggled to convince investors of its business. The company was among a wave of much-championed tech companies to go public in Hong Kong — — but its share price has struggled. Razer currently trades at HK$1.44, which is some way down from a HK$3.88 list price and HK$4.58 at the end of its trading day debut. Razer CEO despite a flurry of IPOs, which have included names like local services giant Meituan. Nabbing Tencent, which is one of (if not the) biggest games companies in the world, is a PR coup, but it remains to be seen just what impact the relationship will have at this stage. Subsequent tie-ins, and potentially an investor, would be notable developments and perhaps positive signals that the market is seeking. Still, Razer CEO Min Liang Tan is bullish about the company’s prospects on mobile. The company’s Razer smartphones were never designed to be ‘iPhone-killers’ that sold on volume, but there’s still uncertainty around the unit with the third-generation phone may have been canceled following some layoffs. (Tan declined to comment on that.) Mobile is tough — just ask past giants like and about that… — and Razer’s phone and gaming-focus was quickly copied by others, including , to make sales particularly challenging. But Liang maintains that, in doing so, Razer created a mobile gaming phone market that didn’t exist before, and ultimately that is more important than shifting its own smartphones. “Nobody was talking about gaming smartphones [before the Razer phone], without us doing that, the genre would still be perceived as casual gaming,” Tan told TechCrunch in an interview. “Even from day one, it was about creating this new category… we don’t see others as competition.” With that in mind, he said that this year is about focusing on the software side of Razer’s mobile gaming business. Tan said Razer “will never” publish games as Tencent and others do, instead, he said that the focus on helping discovery, creating a more immersive experience and tying in other services, which include its Razer Gold loyalty points. Outside of gaming, Razer is also making a push into payments through a service that operates in Southeast Asia. , Razer has moved from allowing people to buy credit over-the-counter to launch an e-wallet in two countries, Malaysia and Singapore, as it goes after a slice Southeast Asia’s fintech boom which has attracted non-traditional players that include AirAsia, Grab and Go-Jek among others.