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Game engine vendor Unity has announced it will launch operations in China, and has attracted a who’s who of local tech giants as investors.
A company announcement said Alibaba, mega-carrier China Mobile, smartphone maker Oppo and Doyin Group — a subsidiary of TikTok developer ByteDance, which is being considered as an IPO vehicle — all had stakes in Unity China.
Unity will hold majority ownership of the resulting joint venture, which is valued at more than $1 billion in domestic investments on day one.
The company said the JV “opens up new opportunities for us to partner with local companies and increase our R&D investment to better meet the needs of China’s creative community.”
Those efforts will see Unity create a “China-specific version of its localized products tailored for game developers, including Unity’s flagship Unity editor.”
But the unity is silent on why the Chinese body is needed.
Which is interesting, because while China has a large number of game developers, they’re having a tough time at home. Beijing has stepped up its approval of new game publications based on its general acceptance of games. However, the likes of Chinese tech giant Tencent are responsible for some of the world’s most popular and profitable mobile games and already use Unity – so helping Chinese developers has some advantages.
Whether the move will win over many Chinese developers remains to be seen. If this is the case, their concerted efforts may be consumed outside of China rather than the Middle Kingdom.
That could actually be another reason for forming a JV. China’s recently introduced data export laws make it difficult for businesses to send information about Chinese citizens offshore. Doing local surgery means unity will be easier to stay on the right side of this law.
China’s offer-you-can’t-refuse policy of asking foreign tech companies to work with locals and share their source code comes into play here as well. If Chinese developers use Unity more, Beijing could simply ask for a local body to ensure the company’s platform is available.
Unity is certainly wary of the fate of the Chinese hubs of other foreign companies, such as chip designer Arm, which has decided that the IP of fraudulent and rival companies is worth its attention. At least Arm China has not been accused of stealing Arm China’s IP—and people—as seen in the efforts of Chinese companies after investing in foreign companies.
Unity therefore hopes that the case in China will not lie to its name. ®
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