By Josh Ye
HONG KONG (Reuters) – Revenue in China’s video game industry fell in the first half of 2022 for the first time since data became available 14 years ago, as the world’s biggest video game market continues to decline. collapse in the face of Beijing’s tightening surveillance.
Combined industry revenue fell 1.8% to 147.7 billion yuan ($21.8 billion) in the six months to June, according to a report released Thursday by the China Association of Industry. Audio-Video and Digital Publishing, a state-backed industry group.
It’s the first drop since data began to be released in 2008 and reflects how China’s huge gaming industry, once marked by runaway growth, has been badly bruised by Beijing’s efforts to bolster its industry surveillance, including reducing the number of game licenses distributed and limiting game time for teenagers.
The report also shows that the number of players nationwide fell for the first time to 665.69 million from 666.57 million in December.
Domestic revenue for Chinese game companies fell 4.25% to 124.5 billion yuan. With heavy domestic regulations, companies looked to overseas markets for growth, where revenues rose 6.16% to nearly $9 billion during the period.
China froze new game approvals for nearly nine months before resuming them in April. However, industry giants including Tencent Holdings and NetEase have yet to secure new licenses.
China’s actions against the gambling industry are part of a broader regulatory crackdown on large swathes of its economy, from property to technology.
But authorities have changed their tune in recent months as they seek to stimulate an economy hit by COVID-19 containment measures. This change has given rise to hope among companies and investors that the worst is over, even if the jitters remain.
(Reporting by Josh Ye; Editing by Kirsten Donovan)