How China bought Western video game industry

Unknowingly, the players of League of Legends, Clash of Clans, and Fortnite are partly financing the communist political regime that keeps the Chinese people under the rule of a president for life. For the past ten years, China has been gradually buying up the video game industry.

The Chinese Communist Party has long sought to prevent Western entertainment from entering the country for fear of seeing the masses seduced by the freedom of tone and confidence of the heroes.

Thus video games on consoles were banned between 2000 and 2014, while the “Great Firewall of China” prevent users from playing Western PC and online games. The “Great Firewall of China” is officially known as the Golden Shield Project.

The plan consists in establishing total censorship and continuous surveillance of the internet in China. By cutting off the masses of conflicting information, it is easier to manipulate them.

At the same time, the Communist Party has set up a massive operation to buy out Western cultural industries, including the most profitable and popular: video games.

The real question today is which companies are not influenced by Chinese communism?

Quick history of Chinese takeovers

Since I have the bad taste to be interested in the video game economy and not only in gameplay, I was surprised by Tencent’s rapid implementation in the entertainment industries.

Here is a short history of China’s purchases of video game companies.

• 2011 92.78% buyout of Riot Games, creator of the MMO League of Legends. Complete buyout in 2015.
• 2013 40% buyout of Epic Games.
• 2015 Buyout of more than 50% of Miniclip.
• 2016 Buyout of 84.3% of Supercell, developer of the mobile game Clash of Clans, Boom Beach, and Hay Day.
• 2018 80% buyout of Grinding Gear Games (Path of Exile), RPG Free to Play
• 2019 100% buyout of Sharkmob, a new studio made up of former developers of the Hitman series.

In 2020, Tencent’s investments are still significant, but the amounts and percentages are now secret.

As financial infiltration is to be kept quiet, most new buyouts have a helpful confidentiality clause.

All we know is that Tencent has acquired all or part of core gaming studios such as Platinum Games (NieR:Automata, Bayonetta) et Yager (Spec Ops: The Line).

So China is buying video game studios but avoids too much media coverage.

Investing in all game formats

For those who know nothing about video games, League of Legends is one of the leaders in online gaming with $1.5 billion in revenues in 2019 according to Nielsen’s SuperData de Nielsen.

Every year e-sport tournaments are celebrated with concerts and exclusive music videos.

For its part, Epic Games produces the Unreal Engine, which is the most popular game engine in the video game market (about 25% of the games industry uses it).

It is also of growing interest to the film and animation industry to create real-time special effects.

But the company is best known to the general public for the Gears of War and Fortnite series. The latter brought in $1.8 billion in revenues in 2019.

Epic Games also positions itself as a competitor to Valve in the distribution of online PC games.

Tencent invests in the most profitable companies of the moment while at the same time having a stake in other video game companies, including :

• 5% Activision Blizzard (Call of Duty et World of Warcraft)
• 5% Ubisoft (Assassin’s Creed, Rayman)
• 5% Paradox Interactive (Crusader Kings et Hearts of Iron)
• 9% Frontier Developments (Elite Dangerous, Planet Zoo)
• 10% Sumo Group (Forza Horizon, Team Sonic Racing)
• 11,5% Bluehole (PlayerUnknown’s Battlegrounds)
• 20% Marvelous (Story of Seasons)
• 21,5 Glu Mobile (jeux mobile japonais)
• 29% Funcom (Conan Exiles et The Secret World)
• 36% Fatshark (Warhammer: Vermintide 2)

To this list should be added the Korean video game companies and other less well-known companies that have benefited from Chinese financing.

And since many companies are linked to Tencent without announcing it, one can wonder which video game developers are not dependent on China.

The table is incomplete, but it shows the progressive concentration of video game companies in the hands of Tencent.

What is Tencent?

It is currently a communications giant similar to Google in that the business model is selling online advertising on communication platforms owned by the company.

Tencent started with online messaging (QQ) before buying Korean video game licenses and investing in the creation of home-grown MMOs.

At the same time, Tencent invested in Western companies before buying them outright.

Why is this a problem? After all, buying and selling shares is a perfectly standard free-market practice.

Yes, but in a communist regime, everything belongs to the state—at least a specific group of the Party members.

Why is China buying up video game companies?

The answer is threefold: to monitor, entertain, and “re-educate.”

Bread and games

The most straightforward aspect to understand in this long-term strategy is entertainment. Recall that the word means “to divert someone from something” and not “provide a transitory pleasure.” Etymologically speaking, to entertain is to get out of the way, out of the path.

Therefore, to entertain the masses is to divert them from real problems, to keep their attention occupied by secondary quarrels while those who have a real hold on society go about their business.

The strategy is well known as “bread and games.” Instead of circus games, video games and polemics keep young men away from the political sphere or economic issues.

Concretely, when you spend 2 hours a day playing games, you don’t have time to learn about world affairs, and you are more inclined to trust the mainstream media or your entourage without asking questions.

In today’s information society, time is the only scarce commodity. And keeping crowds aggregated behind a screen is the surest way to keep them away from real power.

Optional compulsory donation of personal information

Secondly, buying video game companies allows access to millions of personal data and monitor part of the population in foreign countries.

You don’t need to send spies when information arrives voluntarily and directly in data centers.

Indeed, when you play, you are always more or less obliged to connect to a network belonging to the publisher, the manufacturer.

Whether it’s a Steam, Blizzard, PS4, Nintendo, or Facebook account for mobile games, you must declare your identity.

You also have to give other information, whether it is a means of payment, your list of online friends, your connection habits and game time, your conversation history, etc..

In the past, all you had to do was buy a floppy disk or game cartridge with cash. You were then “untraceable.”

Policing Thoughtcrime

Third, video games are more immersive than any movie or book. They offer an alternative version of reality and provide human interactions constrained by specific interfaces.

By controlling the imagination and directing the masses towards what is supposed to be pleasant and commonly acceptable, fictional worlds can operate a form of “re-education” of the players.

Here you’re thinking that I’ve been smoking too much. Unfortunately, this is at the heart of current debates with mainstream journalists and developers who want to incorporate more “diversity” into games.

Some are making a career out of consulting to include more female characters in games because imaginary representation would influence male behaviors labeled as “toxic.”

Note that these same consultants cannot see how women also have “toxic” behaviors and how they differ from male behavior.

In concrete terms, these consultants’ intervention is seen mainly through narratives in which almost everything but a heterosexual white man is in power. Visually, the female characters have to put on cover everything with clothes to fight against patriarchy.

Somebody must have forgotten to pass the memo to the feminists fighting the patriarchy by showing their breasts.

NIMBY: demoralizing the enemy

Unlike video games in the West, video games in China are censored by the Communist Party. Literally. They need government authorization for distribution. As the South China Morning Post pointed out.

They still need approval from the culture ministry … for their products, which I think is reasonable, because the government wants to make sure the content of your games is not too violent or politically sensitive for young people

SCMP

Therefore, the Party aims at controlling both the players in foreign countries and the masses at home. As a result, the games are subject to a facelift more or less significant according to experts’ opinions.

Thus, in the West, more than 27 characters of the game Overwatch are non-heterosexual. In the Chinese version, everyone sleeps with the opposite sex because one should not show “degenerates” to entertain the crowds in China. Hide those LGBTQ people who can’t be seen!

The companies acquired by Tencent apply NIMBY (Not in My Back Yard), reserving the practices that the Party considers non-compliant outside of Chinese territory.

If one can doubt the re-education of the gamers in the short term, it is clear that, financially, the infiltration is real and allows the Party to find monetary resources from countries it does not yet control.

Of course, China does not only buy video game companies. Social networks and communication platforms are the other major part of the investments, with Discord, Reddit, and many others in their wake. But this is another story to read here.