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| People pass by Tencent's headquarters in Guangdong, China, on July 12. AFP-Yonhap |
By Kim Jae-heun
China's IT giant Tencent is investing more into the Korean game sector amid the Chinese government's continued regulation on its game industry.
According to local investment banking industry sources, Tencent participated in the latest share-issuing round organized by NXN. The amount NXN invested was unknown. However, Tencent was said to have assessed NXN's equity value at over 100 billion won.
NXN was founded by Yoo Seok-ho, a former Nexon executive who managed the development of "Reven," the mega-hit action role-playing game (RPG). Behind Tencent's decision for its investment in NXN was its confidence in NXN CEO Yoo over his expanded role to release future popular games.
NXN is preparing to participate in E3, one of the top three global game industry trade events, and introduce a new game in June next year.
China has been imposing stronger restrictions on their teenagers to limit their game playing time, which has been impacting China's major game companies including Tencent and Netease. People under the age of 20 are only allowed to play games from 8 p.m. to 9 p.m. on weekends and holidays. Also, all gamers must verify and register their ID with a real name account.
China's game market has already grown to the level it cannot retreat and the Chinese government's sudden regulation is catching up with Tencent. In 2019, Chinese game market sales stood at 47.53 trillion won ($40.16 billion) in terms of monetary size, a year-on-year growth of 20.7 percent.
But due to the stiff regulation, Tencent's core businesses are facing questions from investors forcing it to turn its eyes to the Korean game industry, said officials. "Tencent is said to be in touch with several more local game developers. It is very likely that it will make an additional investment in the near future," an industry source said.
Earlier, Tencent invested 100 billion won in Line Games, an affiliate of mobile platform operator Line. Line Games not only develops mobile platform games but it also has acquired game titles such as "Dragon Flight," "Destiny Child" and "Exos Heroes."
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