2021 year in review

Previous yearly reviews: 20202019201820172015.

Industry stuff

If 2020 was a year where the global games industry got drunk on pandemic growth, 2021 was the hangover. Consumption growth stalled, as expected. Supply chain disruptions have meant a difficult transition for the new console generation. And developers also wrestled with production delays and ongoing uncertainties of office re-openings.

In China, there was even less to cheer for. Game license approvals have again been stalled since August, and thus there were only 755 games approved for the whole year – a 46% decrease from 2020. And there were only 76 imported titles – it’s important to note that any game that’s based on a foreign IP is typically treated as an import title (e.g. Netease making a MOBA with Marvel characters), so the number of licenses issued to games made by developers outside China is even smaller. In comparison, NPD reported over 2,000 premium games released across consoles and Steam in the US in 2021; and there’s about 10k games released on Steam every year, and certainly a lot more on mobile free-to-play. So the license approval in China has become this ironclad gate, where the vast majority of games produced globally every year are not allowed legal entry. It’s not hard to imagine the rent-seeking behavior this creates.

And then there were the newer and stricter regulations. Minors are now limited to a total of 3 hours of gaming a week, designated at specific hours from Friday to Sunday. (If you work in server operations, these kinds of schedules create the worst traffic spikes during your peak hours – and indeed Honor of Kings suffered server outages when millions of youngsters wanted to login at the same time Friday night.) Tencent also voluntarily introduced time restrictions for adults, and thus it’s now a common sight to see streamers swapping accounts to extend their playtime while on air.

And thus Chinese game companies continued their international expansion, looking for greener pastures elsewhere. miHoYo opened a studio in Montreal, following a series of studio openings across North America by Tencent. But there’s also regulatory headwinds, with the US government scrutinizing Chinese services. This is partly what prompted Tencent to unveil a new publishing entity, Level Infinite, headquartered in Amsterdam and Singapore; and likewise miHoYo transferring Genshin Impact’s publishing to its Singapore entity Cognosphere. It’s unclear to me that such attempts to create a legal separation between China onshore and offshore entities would appease regulators outside of China, and the legal gymnastics could eventually become untenable.

Speaking of Genshin Impact, it continues to impress on the global stage, not just in terms of its business performance, but also cultural impact. I think it’s doing a lot to elevate the stature of Chinese games with players globally. Another mobile game worth mentioning is Harry Potter: Magic Awakened, developed by the Netease team that created Onmyoji. This game has set a new bar for launch live-ops in China: players were allowed to download the game, log in to create their characters, and socialize with other players in-game a few days before the official launch date; combined with a creative marketing campaign (a “back to magic school” theme that coincided with the real-life back-to-school season), the game was a viral sensation.

On a separate note, one positive development was the formal end to “996” at most large tech companies in China. Partly spurred by regulatory scrutiny, and partly perhaps due to an attitudinal shift in the new generation of talent, this is one more sign that the hyper-growth years are over.

Oh, and there was the Bubble – metaverse, web3, NFTs, play-to-earn… Even to a disinterested observer like myself, these concepts seemed to have sucked all the air out of public discourse. In China, discourse around NFTs and crypto-gaming have been much more muted, thanks to the ongoing government crackdown against crypto. But the “metaverse” hype cycle was in full force. It’s hard not to be skeptical, when you hear about some blue-blood VC eager to fund a team (which has never made a game before) pitching a cross-platform metaverse MMO. But for now, the music hasn’t stopped playing, and so the game continues.

Finally, Wild Rift – the game I worked on for 2.5 years from late 2016 to mid 2019, and where I was one of the first 3 people on the team – finally launched in China, as the more straightforwardly (and better, IMO) named League of Legends Mobile. Early data seemed to have been very good, at least good enough for the project team to win the prestigious “major business breakthrough” award within Tencent. But of course the jury is still out on whether the game can sustain. In any case, I’m just happy that Chinese players can enjoy it (or unite in complaining about the matchmaking – but that should a post for another day).

Work stuff

2021 was the second full calendar year I worked at Supercell Shanghai. The office was open year round, except for a couple weeks when one colleague was quarantined by the Shanghai government in a contact tracing effort. (In my colleague’s case, apparently the Didi ride they took had transported someone flagged as a close contact of a suspected case, and so my colleague was flagged as well – this is one anecdotal example of how contact tracing had been enforced locally.

It was still far from a normal year for work, since it was a massive undertaking to enter or leave China. So we really missed out on cultural exchanges and collaborations with other Supercell offices. And it also took a heavy toll on our recruiting strategy, since it was practically impossible to hire from overseas.

It’s hard to develop new games and build new teams and establish a new studio’s culture all at once. (Duh!) And thus it was an exciting milestone (and a big sigh of relief?) when my coworkers soft-launched Clash Mini towards the end of the year. I didn’t work on the game, but given how small our studio is, I’ve had a great front-row seat to its trials and tribulations. There’s a Chinese idiom that says a bystander sees more clearly than the person directly involved; I certainly felt this way in the numerous peer 1-1s I’ve had with Mini’s game lead.

As to my own project, there’s not much to talk about publicly, yet.

One book that had a significant influence on how I worked was Noise: A Flaw in Human Judgment. Whatever its flaws (reviews online are fairly mixed), the discussions of how to run better recruiting and performance evaluation processes prompted me to change my approach on these topics.

Personal stuff

As a family, we still didn’t do much travel in 2021. A large part of this is thanks to the tight travel policies of local schools, which implemented extra restrictions on top of city-wide policies. For example – if my son left Shanghai, at the minimum he will have to submit a negative PCR test result and self quarantine for 48 hours before he can return to school.

For many Chinese families, such requirements haven’t dampened their interest for travel. And some have gotten quite creative at beating the system – for example, if you have multiple mobile lines (which many Chinese do, partly due to the low cost and the restrictive carrier lock-ins), you can leave one SIM inactive at home, and use that number to generate a green report (based on carrier location tracking) that says you have not left the city.

But anyhow, in my family’s case we played it safe. That has meant opportunities to pick up new hobbies. During the pandemic, my son became a huge fan of American Ninja Warrior, so I’ve tried to gently nudge his athletic interests. (He’s definitely starting from behind in this regard, since my wife and I both lack good exercise habits or play any sports still.) I couldn’t find a Ninja Warrior style gym in Shanghai – so we picked up rock climbing (in gyms) instead.

Anecdotally, rock climbing feels like an up-and-coming sport in China. There’s not a huge list of facilities in Shanghai, but it’s been a mini adventure taking my son to a handful of gyms over the past year. There’s usually 2 distinct groups of customers at these venues. The first is kids – parents paying for private lessons for their children, perhaps hoping to get some certifications that help towards high school applications. The second is young people in their early twenties, skewing slightly more female than male. And if I had to guess, I’d say the first group overall outnumber the second – so you could say that the job-to-be-done of climbing gyms in Shanghai is primarily to address the education-system anxieties of Chinese parents.

There are a few lessons I’ve observed from all these trips to climbing gyms. The first is how people overcome their natural instincts through practice. All beginner routes at these gyms use auto-belay devices for safety: they respond to your weight and will lower you at a controlled pace when you fall. So the first thing all new climbers need to learn is to let go of the wall to safely descend. This can be a lot harder than it sounds – I’ve lost track of how many kids I’ve seen that are “stuck” at the top of the wall because they can’t let go. It’s a counter-intuitive move that requires a leap of faith initially. With enough repetition though, you can overcome your natural survival instincts.

Another small lesson is how first-time customers (especially parents taking their kids to try out climbing) misjudge the relative difficulty of bouldering (3-5 meters tall) versus wall climbing (12-15 meters tall). They assume that the taller wall, which requires protective gear, must be harder; whereas gym staff will almost unanimously tell them that bouldering is more technical and harder, especially compared to the beginner climbing wall routes that are effectively ladders. I guess this is another example of how subject-matter literacy is required for informed debates (yes, I’m alluding to the NFT discourse on Twitter that is driving game devs mad).

Media consumed

I played a lot of Hades in the beginning of the year. I was quite hooked, so much so that I was carrying my PS5 controller with me when I traveled for work. Besides getting platinum in achievements (alas, I have almost no friends on Epic Game Store to brag to), I even attempted speed-running and was very proud of myself for setting a personal best of a sub 9-minute run (which is ranked about 300ish on speedrun.com).

Towards the end of the year I binged Wild Rift a lot on China server, probably more than I would have expected. I can now see it’s a bit of an acquired taste – it’s the most competitive and serious real-time PVP game I’ve played on mobile, and the intensity of the experience is a notch higher than pretty much any other mobile game. The literal $B “product-market-fit” question is how many players there are in the world that want this intense an experience on this particular platform. In China it’s a lot – quite a bit smaller than Honor of Kings, for sure, but we are still talking about tens of millions of players at least.

The rest of the year I can’t really recollect what I played. I sampled a bunch of games on Xbox Game Pass, but didn’t play anything deeply. On the indie/AA side of things, I enjoyed Death’s Door and F.I.S.T. enough to write about them, and I was impressed with the latter as a very competent first outing for a Chinese studio.

For film and TV that I watched for the first time last year, Dune (2021), Samurai Rebellion (1967) and Free Solo (2018) were my top 3 feature films; Generation Kill (2008) was my favorite TV series, though the latest seasons of Succession and Ted Lasso are also very close to my heart. Squid Game – by far the biggest surprise hit of the year – was in my opinion another reminder of how fruitless it is to make ex-ante forecasts; we can only make ex-post rationalizations of the show’s success.

Photo by Jonathan J. Castellon on Unsplash

2 thoughts on “2021 year in review”

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.