South Korea-based PUBG Corporation, which runs sleeper hit gaming title PUBG Mobile, announced last week that it plans to return to India, its largest market by users. But its announcement did not address a key question: Is India, which banned the app in September, on the same page?
The company says it will locally store Indian users’ data, open a local office and release a new game created especially for the world’s second-largest internet market. To sweeten the deal, PUBG Corporation also plans to invest $100 million in India’s gaming, esports and IT ecosystems.
But PUBG’s announcement, which TechCrunch reported as imminent last week, is treading in uncharted territory and it remains unclear if its efforts allay the concerns raised by the government.
Since late June, the Indian government has banned more than 200 apps — including PUBG Mobile, TikTok and UC Browser, all of which identified India as their biggest market by users — with links to China.
New Delhi says it enforced the ban over cybersecurity concerns. The government had received complaints about the apps stealing user data and transmitting it to servers abroad, the nation’s Ministry of Electronics and Information Technology said at the time. The banned apps are “prejudicial to sovereignty and integrity of India,” it added.
KRAFTON, the parent firm of PUBG Corporation, inked a deal with Microsoft to store users’ data of PUBG Mobile and its other properties on Azure servers. Microsoft has three cloud regions in India. Prior to the move, PUBG Mobile data concerning Indian users was stored on Tencent Cloud. In addition, PUBG said it is committed to conducting periodic audits of its Indian users’ data.
In India, PUBG has also cut publishing ties with Chinese giant Tencent, its publisher and distributor in many markets. This has allowed PUBG Corporation to regain the publishing rights of its game in India.
At face value, it appears that PUBG Corporation has resolved the issues that the Indian government had raised. But industry executives say that meeting those concerns is perhaps not all it would take to return to the country.
Here’s where things get complicated.
Not a single app India has blocked in the country has made its comeback yet. Some firms such as TikTok have been engaging with the Indian government for more than four months and have promised to make investments in the country, but they are still not out of the woods.
PUBG Corporation, too, has not revealed when it plans to release the new game in India. “More information about the launch of PUBG Mobile India will be shared at a later day,” it said in a statement last Thursday. According to a popular YouTuber who publishes gameplay videos on PUBG Mobile, the company has privately released the installation file of the new game and has hinted that it plans to release the game in India as soon as Friday. (There’s also a big marketing campaign in the works, which could begin on Friday, people familiar with the matter told TechCrunch.)
The new game privately made available to some YouTubers is not published on Google Play Store or App Store for the interim, but requires manual side-loading. All of this indicates, and people familiar with the matter say, that PUBG Corporation has not yet received the approval from the government.
Instead, PUBG Corporation is publicly attempting to create positive buzz about its new game from its tens of millions of fans, and persuade the government to review its case. Daring to do all of this publicly is a bold move, but PUBG Corporation is in a unique position in some way.
Unlike every other app that the Indian government has banned, PUBG Mobile is not owned by a Chinese firm. From the outside, it appears that whatever reliance it had on China’s Tencent, it has severed those. So it stands a chance to make a case for its comeback.
But the bigger issue, according to two industry executives, is how government officials in New Delhi see it and they are yet to break their silence on the matter — at least on record. And it has to do with the optics.
If the government permits PUBG Corporation to release a new game, it will open the door to all the other impacted apps to replicate this strategy. “Depending on how crucial India is to many of these companies, they will race to partner with local companies — or even sell significant stake to international businesses … have Microsoft, Google, or Amazon handle their India data and get compliance,” an industry executive cautioned.
But privacy, security or ownership compliance is perhaps not what is at the heart of this ban enforcement.
Many in India believe New Delhi’s move to ban Chinese apps is driven by geopolitical tensions between the two nuclear-armed, neighboring nations. Tensions have escalated on the nations’ disputed Himalayan border in recent months. Border skirmishes in June this year resulted in the killing of 20 Indian soldiers and an undisclosed number of Chinese troops.
Nobody knows for sure when the two countries (which waged war with each other in 1962) will reach a peaceful agreement. In recent months, both the nations have engaged in a military build up along their borders.
While they work on resolving that issue, India has sought to send a signal by enforcing restrictions on what Chinese companies, which have poured billions of dollars into Indian startups in recent years, can now do in the world’s second-largest internet market. In addition to the ban, New Delhi now also requires its oversight on any investment a Chinese company makes into an Indian startup.
For Chinese companies like Tencent, Alibaba and ByteDance, India is one of their crucial international markets as they look to amass their next hundreds of millions of users.
Some believe — and they, like everyone else, spoke on the condition of anonymity to freely speak on this sensitive subject — that as the winter kicks off in India and China, a peaceful agreement is imminent. “In a region where the temperature drops below zero degree celsius, can the nations have their military in stealth mode? Yes. But would they want to do it? Probably not,” said an industry official.
All of this is going to impact when a gaming company is permitted to launch its new title in the nation. The same executive said that even if the two nations reach an agreement, there might still be some delay in when exactly India eases up on Chinese firms. “The government would likely wait for the right time — a time of its choosing — to make any moves,” the executive said.
Until all those other stars line up, the fate of all the apps that have been impacted by the Indian government is not going to change in the country. Where things stand at present, PUBG’s big announcement will only buy it some time as it convinces its users and influencers to not flock to other games.