China: Apple Sets Deadline for App Developers to Obtain Government Approval
In 2016, China introduced regulation requiring that mobile game developers obtain approval from government censors for any premium games or games with in-app purchases. The only games exempted were those using an ad-only revenue model.
Many of the games currently on the Chinese App Store appear to be out of compliance, but today Apple alerted developers that they must obtain government approval by June 30 if they wish to remain on the App Store.
“Chinese law requires games to secure an approval number from the General Administration of Press and Publication of China,” Apple wrote to developers. “Accordingly, please provide this number to us by June 30, 2020 for any paid games or games offering in-app purchases that you intend to distribute in mainland China. You can enter your game’s approval number and date below. To learn more, view the full text of the regulation. If you have questions, contact us.”
Small developers are most likely to be hit by the regulations. According to Rich Bishop, CEO of AppInChina, the Chinese government is only approving 20-30 foreign games per month. With hundreds of thousands of games on the App Store, it’s likely that only a very small percentage will be officially approved by the government. As a result, many of the smaller game makers may have to move to an ad-only business model or exit the market entirely.
Bishop pointed out that companies frequently secure approval to do business in China by partnering with domestic companies. Nintendo, for example, partnered with gaming behemoth Tencent when it launched its Switch console in China.
“The largest game developers will be able to partner with Chinese publishers such as Tencent, Netease, and AppInChina in order to obtain a license and continue publishing their games in China,” Bishop told CNBC.
These partnerships greatly benefit Chinese business. In exchange for help navigating the Chinese bureaucracy, revenue-sharing agreements ensure a portion of the profits remains in domestic hands.
While Apple is only now coming into compliance with the Chinese regulations, Android app stores – which account for 79 percent of market share – have been complying with the regulations since 2016.
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