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Home Business & Finance The promise and challenge of Roblox’s future in China – TechCrunch

The promise and challenge of Roblox’s future in China – TechCrunch

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Summary (IA Generated)

In a much-anticipated move, California-based gaming firm Roblox filed to go public last week.

One aspect driving the future growth of the children- and community-focused gaming platform is its China entry, which it fleshes out in detail for the first time in its IPO prospectus.

Like all gaming companies entering China, Roblox must work with a local publishing and operations partner.

And like Riot Games, Supercell, Epic Games, Activision Blizzard, Ubisoft, Nintendo and many more, Roblox chose Tencent, the world’s largest gaming firm by revenue, according to Newzoo.

The prospectus notes that Tencent currently intends to publish and operate a localized version of the Roblox Platform (罗布乐思), which allows people to create games and play those programmed by others.

User-generated content is in part what makes Roblox popular amongst young gamers, but that social aspect almost certainly makes its China entry trickier.

It’s widely understood that the Chinese government is asserting more control over what gets published on the internet, and in recent times its scrutiny over gaming content has heightened.

Industry veteran Wenfeng Yang went as far as speculating that games with user-generated content will “never made path to China,” citing the example of Animal Crossing.

Roblox says it believes it’s “uniquely positioned” to grow its penetration in China but its “performance will be dependent on” Tencent’s ability to clear regulatory hurdles.

It’s unclear what measures Roblox will take to prevent its user-generated content from running afoul of the Chinese authorities, whose appetite for what is permitted can be volatile.

Tencent itself has been in the crosshairs of regulators over allegedly “addictive” and “harmful” gaming content.

Roblox chose Tencent as its Chinese partner.

While Tencent is still working to obtain the required regulatory license to publish and operate Luobulesi in China, we believe the regulatory requirements specific to China will be met.

China is the world’s largest gaming market and Tencent has a proven history of converting its social network users into gamers.

It notes in the prospectus that CFIUS has “made inquiries to us with respect to Tencent’s equity investment in us and involvement in the China JV.

The other obstacle faced by all foreign companies entering China is local clones.


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