Tencent loses nearly $34 billion since the PUBG Mobile ban in India — its second-largest valuation dip this year
- The company behind the Chinese app PlayerUnknown’s Battlegrounds (PUBG) Mobile, Tencent, is trading in the red for a second straight day after the Indian government banned the battle royale game.
- Its market value has plummeted by nearly $34 billion over the last two days with Tencent's share price falling by 2% yesterday and is over 3% in the red so far today.
- The company said that they will engage with the Indian authorities to ensure the continued availability of their apps in India.
This is the second biggest dip in Tencent’s valuation since Bloomberg reported that the company lost $66 billion last month when the US President Donald Trump banned WeChat.
“Tencent takes the protection of user privacy and data seriously. Our apps have always remained in compliance with applicable data protection laws in India and all other markets where we operate. We look forward to engaging Indian authorities to clarify our long-established policy and action in protecting user data, and hope to ensure the continued availability of our apps in India,” the company said in an emailed statement to Business Insider India.
In addition to PUBG Mobile, other Tencent mobile apps like Chess Run, Arena of Valor and Ludo World have also been banned in India.
Tencent's PUBG influence on India
When PUBG Mobile first launched in 2018 for Indian users, it took the country by storm. Not just in terms of people rushing to download the game, but there were telltale signs of the culture itself all round — from PUBG-themed restaurants to the game’s signature level-three helmet sold at thrift shops.
Most gamers were relieved when the game’s name was absent in the first list of banned apps that India released on June 29. This was after the Galwan Valley border skirmish with China, where 20 Indian soldiers lost their lives, and there was an undisclosed number of casualties on the Chinese side.
However, come September, another face-off between Indian and Chinese troops — this time along the southern banks of Pangong Tso Lake — led to the release of another list. One that included not just PUBG Mobile, but its sister-apps like PUBG Mobile Lite and PUBG Mobile Nordic Map: Livik.
Not only has this left professional gamers and streamers in the lurch, with the source of their livelihood suddenly disappearing, but it’s also hurting Tencent’s share price.
India makes up one-fourth of PUBG’s user base
Tencent first set its eyes on India in 2017 when it pumped in $700 million into India’s most valuable Internet at the time — Flipkart — and another $1.1 billion into the cab-hailing service Ola. Already leading in China, the technology behemoth was looking at India’s market to provide the growth it needed to keep up valuations.
One year down the line, after a soft launch in China, it released PUBG to the rest of the world. Come 2020, gamers in India account for nearly a quarter of its downloads — ahead of even China, according to data by Sensor Tower.
Tencent even launched PUBG Lite in India to expand its user base further. The aim behind the toned-down version of the original game was to bring more gamers online who may not necessarily own high-end phones. The ‘lite’ version was also to overcome any connectivity issues for gamers who live in areas that face network issues.
But when it comes to revenue, Indian mobile application users aren’t known to be big spenders. Despite making up PUBG’s largest user base, spending is less than 5%.
|Country||Revenue from PUBG (lifetime spending)|
This isn’t the first time that PUBG has faced backlash in India. The game has been mired in controversies - been accused of being too violent, addictive, and a persistent source of distraction for students - which almost led to the game being banned several times.
As of September 4, the game is still working on phones that already have it installed and is also available for download in the Google Play Store. However, as with the first list of apps, the game will likely be taken off the shelves, and Indian IP addresses will be blocked.
The silver lining is that for those who have the means, they can still play PUBG on a computer, even though they will have to learn a whole new set of controls.
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