With a mountain of backlogged video game license applications, China’s content regulator asks for a pause in submissions

China’s government can’t keep up with the country’s appetite for video games.

China’s national-level content regulator has asked local authorities to temporarily stop submitting license applications from video game publishers so that it can process backlogged applications accumulated during a nine-month freeze last year, Reuters reported, citing three people with knowledge of the matter.

This may deal a blow to China’s top companies in the gaming industry, including Tencent and NetEase, dimming hopes for getting their major titles approved soon.

The regulator has granted licenses for 538 games since the ban was lifted in December, but three of Tencent’s games were approved, while NetEase received a license for only one.

Chinese authorities suspended its video game license processing last March due to governmental restructuring, while pushing an official narrative that video games might hurt its younger generation. As a result, Tencent’s share price plummeted.

However, online games still generated RMB 25.81 billion (US$3.8 billion) for Tencent in the third quarter of 2018, accounting for almost one-third of its entire revenue of 80.6 billion (US$11.72 billion) in that period.

Editor: Brady Ng