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Bengaluru, NFAPost: As tit for tat game is going on in US-China relation, technology giant Apple stopped updates for thousands of mobile games in the Appstore in China. Apple is also facing regulatory pressure from the Chinese government to share revenue.

Apple App Store is so popular in China that majority of the users use Apple hardware as it is priced less in China. Also, the majority of Apple hardware production is happening in China.

Cupertino-headquartered Apple finds the Chinese gaming market as its one of the primary source of revenue. Now China has come up with restrictive policies for foreign developers selling games using Apple store.


Details: 

The American tech giant said developers would not be able to update their games without a valid license issued by the Chinese government, Financial Times reported Thursday.

  • Games will not be removed from Apple’s App Store, and the company will allow games to be downloaded, said the report.
  • TechNode reported in February that Apple sent a notice to developers requiring them to submit valid license numbers for paid games or games offering in-app purchases before June 30 in order to distribute in mainland China. 
  • In a notice sent to game makers that have titles listed on the Chinese App Store, Apple said: “Chinese law requires games to secure an approval number from the General Administration of Press and Publication of China.”

To tighter the regulatory noose around developers and Apple, the Chinese government authorities have already informed developers to take separate licenses to continue their game offering in the iOS App Store from July onwards.

China restricts content on a vast number of factors, ranging from anything considered too politically “taboo” to inappropriate character appearance. Game developers are expected to comply with the rules and show proof of license to make their games available for download.

Apple had managed to avoid such regulations until now, even though the rules had been in place since 2016. Other App Stores, like those run by Huawei and Xiaomi, have been complying with the regulations for some time now.

“No one is entirely clear how Apple managed to avoid enforcing the 2016 licensing rule for so long. But considering the US-China trade war began heating up earlier this year, the timing is suspicious,” Todd Kuhns, Marketing Manager for the consultancy group AppinChina, said. The company estimates that Apple could now lose up to $879 million in lost sales.

To comply with regulation, Apple has begun freezing updates for thousands of games in China’s App Store it the developers don’t submit proof of license.

Some developers stopped hosting their apps in China’s App Store, assuming that Apple would remove the games in the future. Electronic Arts, for example, had posted an in-game notice telling those who played Star Wars: Galaxy of Heroes that it was suspending in-app purchases, and that they anticipate their app to be removed in the future.

However, some analysts believe that Apple will not lose nearly as much as others estimate. Charles Chai, vice-head of research at 86Research; a Shanghai-based equity research firm estimates that Apple will only lose $340 million in lost sales. He notes that 90% of the 200 most popular games on the App Store which account for about 80% of App Store game revenue are licensed.

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