Tencent Holdings of China is reportedly in the process of developing a mobile version for the well-received action role-playing console game “Elden Ring,” according to three individuals with knowledge of the matter. This initiative is part of Tencent’s efforts to rejuvenate its aging portfolio of games with a potential new success. In 2022, the world’s leading gaming company secured licensing rights for the title from FromSoftware and established a team of several dozen individuals to create a prototype. Additionally, during the same year, Tencent acquired a 16% stake in Qingci Entertainment, the game’s developer, as per the sources.
The move comes as Beijing is pressing ahead with a plan to curb players’ spending on video games, which it blames for myopia and psychological well-being problems. It is the latest in a series of government crackdowns on the industry, which started in late 2020 amid a growing backlash against the perceived addictiveness of digital games.
Tencent has already faced monetization concerns over its attempt to make big console games compatible with smartphones, a market where gamers are accustomed to frequent updates and in-app purchases. In December, the company canceled a project based on the popular Nier franchise over such issues.
While Elden Ring was designed as a premium, fixed-price game, the sources said that Tencent wants to convert it into a free-to-play title with in-game purchases similar to the success of Chinese rival miHoYo’s hit Genshin Impact. FromSoftware and Tencent declined to comment on the matter.
The source added that a free-to-play model would allow the game to be updated and refreshed more frequently, giving it a better chance of recouping its development costs through in-game sales rather than paying royalties on every copy sold. This strategy is in line with other major game publishers that have boosted the profitability of their titles through this approach, which has become increasingly common in the industry as investors demand higher returns on their investments.
Moreover, Tencent has made an increased push into Southeast Asia as it looks to diversify its portfolio of chart-toppers. This has included the acquisition of Singapore-based game publisher Level Infinite, and it plans to have half of its revenue coming from overseas markets by 2022.
The firm’s increased focus on overseas assets and markets is also a reaction to Beijing’s intensified crackdown on tech companies in recent years, dampening sales at home and weighing on its Hong Kong-listed shares. The company has barely made any investments in China this year compared with 27 deals worth $3 billion overseas, Refinitiv data shows.