App ban fallout: PUBG cancels India franchisee with Tencent
PUBG MOBILE is the mobile version of PlayerUnknown’s Battlegrounds (PUBG), an intellectual property owned and developed by PUBG Corporation, a South Korean gaming company
For PUBG, India is its largest market with more than 175 million downloads, accounting for almost a quarter of total global downloads, according to Sensor Tower. The ban on PUBG app is also hurting India’s small, but fledgling game streaming and the professional gaming community.
“Moving forward, PUBG Corporation will take on all publishing responsibilities within the country. As the company explores ways to provide its own PUBG experience for India in the near future, it is committed to doing so by sustaining a localized and healthy gameplay environment for its fans,” the company said in a statement.
India banned 118 Chinese apps last week, including PUBG, on concerns over “stealing” of user data and for engaging in activities prejudicial to the country’s “sovereignty and integrity.” In June, India banned 59 apps, including the Chinese short-videos platform TikTok.
“I am not aware of PUBG’s strategy but it is obvious PUBG wants to function in India given its popularity and is likely restructuring its distribution channel and diluting its China association in an effort to try and go back to the government and request unbanning of the app,” said Suhaan Mukerji, founding partner of PLR Chambers, policy and regulatory law firm.
PUBG Corp said that it hopes to work hand-in-hand with the Indian government to find a solution that will allow gamers to once again drop into the battlegrounds while being fully compliant with Indian laws and regulations. It clarified that intellectual property owned and developed by the company.
Many believe that the move may help PUBG Corporation reinstate the game in India. Several Chinese apps are struggling to get themselves back in business since India started banning Chinese apps among geopolitical tensions with China.
“If the ban is on the basis of Tencent being a publisher, the game should get reinstated even though it will be a complicated process. If PUBG Corporation comes in on its own, it would then be a South Korean entity,” said Rajan Navani, managing director & CEO, Jetsynthesys, which develops and publishes online games. He is also the president of the Indian Digital Gaming Society.
PLR’s Mukerji believes that India needs to come up with a sanctions framework that it can use to achieve geopolitical objectives against countries it considers hostile to its interests, rather than use a patchwork of existing laws that may not fully serve the purpose and may end up inadvertently compromising on meeting expected due process standards.
“When you ban PUBG and PUBG Corporation leaves Tencent, it is sending a message that if you have global ambitions, better not work with a Chinese platform. The acceptability of Chinese platforms suffers globally and it is a blow to their global ambitions,” said Santosh Pai, Partner and Head of China Desk, Link Legal.
Pai added that he believes that India used a strong tactic and banning of apps has caused economic pain because it has the numbers to make it effective.
“The big implication of this development is that India is at the centre of reckoning. The fact that PubG had to scramble and get this done means India has become relevant. The second implication is that other sources of capital will rush to fill the vacuum,” said Rajeev Suri, Managing Partner at Orios Venture Partners.
India’s top game streamers and professional players are incensed about the government decision as PUBG commands almost half of the game streaming market in India, followed by mobile video games Free Fire and Call of Duty.
Rakesh Mhatre, a 21-year-old who lives in Thane, Maharashtra would spend between 3-5 hours on PUBG every day. After the ban came through, Mhatre, whose live stream YouTube channel is called Nobita Gaming, said he and his fellow gamers have been a bit lost, he said, as they didn’t know what to do anymore.
“The regular gamers are so desperate, one way or another they will find a way to continue playing the game,” he said. “We do play other games like Call of Duty and a few others, but they aren’t as engaging as PUBG.”