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Chinese hold on new video game licenses may last another 4-6 months

Industry slowdown in the country could continue as China centralizes its approval process for new titles

A freeze on new video games being approved for release in China has slowed the country's gaming market considerably, and it seems that the end may not be in sight for some time.

According to a government source speaking to The South China Morning Post, China's new video game licensing procedures and system may take a further 4-6 months to implement. Previously, some analysts expected the freeze to last 2-3 months more.

The freeze has been in effect since March of this year, though until recently the Chinese government had not offered any hints as to why it was not approving any new licenses. Just over a week ago, however, the Chinese Ministry of Education issued recommendations to reduce child myopia, which included limiting new game licenses, and The South China Morning Post reports that the government is centralizing license approvals to a single bureau as a part of that reduction.

The effects of the licensing halt have been conspicuous in the normally-booming Chinese gaming industry, with the country's gaming market slowing to single-digit growth in the first half of 2018 for the first time in a decade.

Though companies like Tencent and Netease were largely able to brush off the trouble for the first half of the year (having acquired licenses for recent releases well in advance), analyst Gao Baowen of Orient Securities predicted that "in half a year, everyone will run out of stock" - not to mention the additional time it would take once the process begins again for those licenses to actually be approved.

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