Why Does China Reject K-Games?

K-Game Creates Fear While Sweeping the Chinese Market in the 2000s

[Asia Economy Reporter Jin-gyu Lee] It has now been almost three full years since China stopped issuing game licenses (distribution permits) for Korean games. Since March 2017, the Chinese government has withheld game licenses for Korean games, using the THAAD (Terminal High Altitude Area Defense) conflict as a pretext. Among various sectors affected by the Hallyu ban (ban on Korean Wave) such as tourism, distribution, and film, only games remain trapped in the THAAD conflict quagmire.

Experts analyze that this is because Korean games once swept through the Chinese market, causing the Chinese government to feel fear and discomfort toward Korean games. Professor Wi Jeong-hyun of Chung-Ang University, who serves as the president of the Korea Game Society, explained on the 4th, "Korean games swept the Chinese market in the 2000s, and the Chinese government has a vague fear of Korean games." He added, "Korean games were the main force culturally overwhelming China even before dramas or K-POP. From the Chinese government's perspective, it was understandable to feel uncomfortable with Korean games culturally dominating China."

Since the Chinese government stopped issuing game licenses for Korean games in March 2017, domestic game companies have been unable to export games to China for over two and a half years. The game license is an approval number issued by the Chinese National Press and Publication Administration to permit game publishing and operation. A license is mandatory to service games in China. Foreign game companies receive foreign-invested licenses, while Chinese game companies receive domestic licenses. China halted issuance of both foreign-invested and domestic licenses in March 2018 but resumed issuing domestic licenses in December 2018.

Last year, foreign-invested licenses were issued for games from Japan, the United States, and the United Kingdom, but no foreign-invested licenses were issued for Korean games. At the Korea-China summit held on the 23rd last year, there was no discussion about issuing game licenses, so it remains uncertain when license issuance for Korean games will resume. Some speculate that with Chinese President Xi Jinping expected to visit Korea in the first half of this year, there is growing anticipation for the lifting of the Hallyu ban and the resumption of license issuance.

However, within the game industry, there is also a view that even if license issuance resumes, it will be difficult for Korean games to sweep the Chinese market as they did in the past. An industry insider said, "The technological capabilities of Chinese games have advanced at an incredibly rapid pace over the past few years, to the point where Korean games now have to follow behind Chinese games."