Tencent, the world’s largest gaming company that also owns technology, social media and traditional media, is shutting down services that give Chinese gamers access to foreign games. The move is seen as a further tightening of regulations by the government, which is very concerned about restricting local residents from accessing games that have been approved by the regulator.
According to Reuters, Tencent will release an update to its game speeding apps that will restrict access to games running outside of China. Games that do not have local operators will no longer be available from these apps, which have historically been used to provide Chinese gamers with access to foreign games.
As reporter Josh Ye explained, foreign games are not blocked by the Chinese firewall, but local internet speeds are often too slow to make online multiplayer games playable. Game speed apps work similarly to VPNs, allowing Chinese gamers to access games not approved by Chinese regulators, such as GTA Online or Animal Crossing: New Horizons. These apps also provide access to the gray market for developers who want to sell their games in the world’s largest market.
An update for Tencent’s mobile and desktop apps that increase the speed of games is scheduled for May 31st.
Over the past few months, Tencent has come under scrutiny from Chinese regulators. Last December, Tencent was banned from launching new games after the company allegedly violated users’ data protection rights, although no specific reason for the violation was given.
China has only recently ended a freeze on new game permits that began last summer. Analysts familiar with the matter reported that 45 domestic games were approved, pushing shares of Chinese gaming companies to new highs. However, Tencent has announced that it will be easing its hiring rate amid pressure to reduce the “size and budget” of future games.