US games Software Developer Unity is working with Chinese tech giants to form a billion-dollar joint venture to expand business in the world’s biggest online games market.
In a statement posted on the Chinese social media platform WeChat on Tuesday evening, Unity said the company would “strengthen cooperation with local businesses and increase investment in research and development to better meet the needs of Chinese creators.” “. It opens up new opportunities.”
The San Francisco-based company first came to China in 2012, and its software tools have enabled many of the country’s most popular games, including Tencent’s Honor of Kings (TCEHY) and miHoYo’s Genshin Impact.
But the expansion of the American company into China comes at an uncertain time for the world’s second-largest economy. Beijing’s crackdown on big internet brands has hurt growth, and rising tensions with the United States over Taiwan and other geopolitical issues are fueling a technology arms race.
Unity accelerates development in China
Local partners planning to collaborate include Alibaba (BABA), China Mobile (CHL), Douyin ByteDance Group, smartphone company Oppo, Xiamen-based online game developer miHoYo, G Network Technology-Bits, and PCI among others. Major players in the Chinese technology industry. Technology is a provider of technology services in the field of artificial intelligence.
China has been the largest gaming market in the world since 2017, but investors are concerned about the impact of the recent internet crackdown in Beijing and the industry’s economic slowdown.
Unity will hold a majority stake in its Chinese company. The value of this business after investment by local partners will be $1 billion.
Junbo Zhang, currently Unity’s general manager for Greater China, will lead the firm as president and chief executive officer, the company said.
Since late 2020, Chinese authorities have launched an extensive campaign to rein in key players in sectors ranging from technology and finance to gaming, entertainment, and private education. Last August, authorities banned anyone under the age of 18 from playing online games on weekdays.
Unity’s Chinese chairman Zhang said in an interview with Chinese tech media site 36kr last month that the company plans to hire about 1,000 software engineers in China over the next few years. Unity did not respond to a request for comment on the reported recruitment plan.
In 2021, the total revenue of China’s gaming industry is expected to be about $47 billion, an increase of 6.4% year on year. Although this represents much slower growth than in 2020, according to recent estimates by global accounting firm PwC, China’s gaming revenues still account for more than a fifth of the global market.
