04 Sep 2020
Posted in Thematic Research
India’s ban on PUBG Mobile will be trouble for Tencent but opportunity for Sea and Activision Blizzard, says GlobalData
Following the news that India has banned 38 Chinese mobile games, including the massively popular PUBG Mobile game;
Rupantar Guha, Associate Project Manager for Thematic Research at GlobalData, a leading data and analytics company, offers his view:
“The ban of PUBG Mobile is a significant blow to the Chinese gaming companies. Tencent, the publisher of PUBG Mobile, saw US$14bn wiped off its market cap within hours of the move. The absence of PUBG Mobile from the Indian market will offer growth opportunities to non-Chinese companies with similar offerings like Activision Blizzard and Sea.
“It will boost the popularity of games like Sea’s Garena Free Fire and Activision Blizzard’s Call of Duty: Mobile among India’s 628 million mobile gaming users. Activision Blizzard, in which Tencent has a 5% stake, has attempted to distance itself from the Chinese company by taking full control of Call of Duty: Mobile from Tencent subsidiary TiMi Studios, which developed the game. This move will allow Activision to stay active in India despite being partially owned by Tencent.
“Sea sells Tencent game outside of China under a strategic partnership but is unlikely to do so in India in the foreseeable future to avoid a possible ban. Epic Games, which hopes to strengthen its position in India with Fortnite Mobile, is unlikely to make an impact due to its ongoing disputes will Apple and Google.
“India’s ban on 177 Chinese apps, including 38 games, is due to the ongoing border disputes with China and data privacy concerns. There is not a lot that Tencent can do at the moment to challenge the ban and retain its 50 million PUBG Mobile users in India, an audience that represents nearly a quarter of the game’s installs worldwide. Most of these players will transition to alternative games and Tencent will have to push hard against competitors to make up lost ground.
“The number of new releases hitting the Indian gaming market will slow down in the next three months, with titles from Chinese companies like Moontoon, Hago and Yoozoo being put on hold. Domestic developers such as Octro, Nazara and 99Games will have an opportunity to make an impact in this period, provided they offer the kind of high-quality, easy-to-play games regularly produced by the leading Chinese companies.”