PUBG ban comes as a jolt to Tencent’s plans

Posted 4 years ago in COMPUTER SCIENCE.

On Wednesday banned PUBG Mobile in INDIA. It is estimated that in India there are over 50 million PUBG users. Along with ban on PUBG the government also banned an additional 117 More Chinese apps.

PUBG ban comes as a jolt to Tencent’s plans

Internet giant Tencent’s fledgling business empire in India is in turmoil after the government banned its crown jewel, the popular PUBG Mobile video game, as New Delhi struck again on Chinese economic interests after a deadly border clash between the troops of the two countries.

With Wednesday’s ban on 118 Chinese apps, Tencent is among the biggest losers alongside ByteDance, whose flagship product TikTok met a similar fate earlier. Tencent has more than 25 apps, which it owns directly or through affiliates, banned in India. This includes the chat platform WeChat and apps like QQ Newsfeed.

Tencent has also invested in news and entertainment platform Newsdog, camera app YouCam and e-commerce platform Shein. All of these apps are now banned in India.

Following the ban, Tencent Holdings lost 2% in Thursday’s trading in Hong Kong.

Before it was banned, PUBG was wildly popular, prompting Prime Minister Narendra Modi to crack a joke on PUBG at a public event last year. While India accounts for a small part of PUBG’s global revenue, it does contribute to most of its downloads. The country ranks No.1 for downloads of PUBG Mobile with 175 million installs to date, 24% of its total installs worldwide.

Experts said the ban will have a significant impact on Tencent’s prospects in India, a market where the Chinese giant had been aggressively expanding its presence.

According to a leading venture capital investor, PUBG Mobile was the “canary in the coal mine” for Tencent in India. “It may be the inflection point, where Tencent decides to divest itself of certain aspects to make sure that the overall company’s prospects aren’t really affected,” he said.

“Tencent gaming has actually made significant inroads, particularly when it comes to PUBG. That’s actually the biggest source of revenue in India. Their prospects have been dented, and they’ve appointed several legal firms to analyze the ban and figure out the next steps,” he said.

PUBG Mobile’s India team declined to comment.

A founder of a gaming platform added that PUBG Mobile generated around $100 million in 2019 from Indian users through in-app purchases alone. The game accounted for roughly a fourth of all spending by Indian users on mobile games last year.

In fact, PUBG Mobile is also credited with establishing the revenue potential of the Indian gaming market through in-app purchases.

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