Why Chinese developers are worried about Steam China launching next week

Steam China, a version of Steam exclusive to residents of China, is finally launching into beta on February 9. 

The regular version of Steam is usable in China, excluding the social features, although it technically shouldn't be according to Chinese government regulations, and it's never been completely clear why. For years, Valve and its Chinese business partner Perfect World have teased work on a government compliant version of Steam that would only feature games that were approved for sale in China. Yesterday, Dota 2's Chinese blog confirmed the impending release of Steam China, and relayed specifics on how Chinese players can migrate their regular Steam accounts onto the new Steam China platform.

The release could have a huge effect on gaming in China and around the world.

Why Steam China is a big deal

Steam has been a fascinating and baffling loophole in the Chinese government's extensive censorship policies.

To be approved for sale on Chinese gaming platforms like Tencent's WePlay, both domestic and international games have to undergo a rigorous censorship process. Not only does China's National Administration of Press and Publication check to ensure games aren't overly violent or sexual, but it also enforces rules like ensuring games place restrictions on children like limiting how often they can play.

For years, though, Steam has been easily accessible to most Chinese PC gamers and has become a haven of unregulated games. Steam has also been invaluable to independent Chinese developers who can publish their games directly to a global audience and sidestep the government's regulations.

When Steam China was first announced, many Chinese developers and publishers I spoke to feared that it would eventually lead to Steam's international version being blocked by the Chinese government's extensive internet firewall. Not only would that cut Chinese PC gamers off from tens of thousands of unregulated games, it could also deny Chinese developers a vital shortcut for releasing their games.

Chinese indie games are currently thriving on Steam. The recently launched Tale of Immortal, for example, has become Steam's fourth most popular game based on concurrent players. If Steam's international version were blocked, those games would have no choice but to obtain a government license, and there's no guarantee they'd be approved.

One Chinese developer I spoke to, who wishes to remain anonymous, said "we are all worried." Another explained that he had spent months trying to spread awareness among other developers to ensure everyone was prepared for the worst.

"The bad news is," that developer said, "if you want to [obtain a license], you must pay at least 20,000 to 30,000 yuan (roughly $3,000 to $4,500 USD), modify your game as they ask, and wait for the investigation, which can last up to 12 to 24 months."

The uncertain future of Steam in China

No one knows what exactly will happen next and there has been little transparency or insight from either Valve or Perfect World. But, according to documents obtained by PC Gamer, Steam China and Steam's international version will seemingly co-exist—at least for now.

One publisher who works in the Chinese market shared an addendum to the Steam distribution agreement all developers must sign when launching a game on Steam. This addendum outlines the process and rules for launching a game on Steam China. It also explains that players won't have to create a second account for Steam China and that games will transfer freely between the two versions—so long as that game is approved for sale on both Steam China and Steam's international version.

That means that if you're a Chinese player and you own a game on Steam and migrate your account over to Steam China, you'll still have access to that game as long as it has been approved. Likewise, if you buy a game on Steam China and log into Steam's international version, you can still play that game.

Of the developers I spoke to, many took this as a sign that Steam and Steam China will coexist, at least at first. According to the publisher I spoke with, the big rumor is that Steam China will initially focus largely on esports—an enormous industry in China—but they believe that, ultimately, Steam's international version will be blocked.

"It would be catastrophic," that publisher said. "I mean, literally hundreds of companies will die within a few months. All those Chinese games you [currently] see on Steam pulling in crazy money, that's only because Steam is available to everyone. There is no alternative. Those regulations, if strictly adhered to, basically kill an indie industry. No one can afford to spend years making a game only to have it sit in a government office for 18 months."

Blocking Steam in China would also have a negative affect on games made outside of China, too. With 30 million users and counting, China has become Steam's second-biggest demographic. Though that sometimes creates drama in multiplayer games like PlayerUnknown's Battlegrounds, plenty of games—especially indie games—benefit enormously from unexpected success with Chinese PC gamers.

As the Dota 2 Chinese blog post explains, once Steam China launches players of both Dota 2 and Counter-Strike: Global Offensive will need to migrate their Steam accounts to Steam China in order to keep playing on local Chinese servers. By moving two of Steam's most popular games in China over to Steam China, it will undoubtedly motivate a lot of players to make the switch. And with an initial launch lineup of 40 approved games and more on the way, Steam China might end up being a more convenient alternative for Chinese PC gamers.

That anonymous publisher thinks that it is only a matter of time before Steam's international version is blocked by the Chinese government. "[It] is inevitable," they said. "I think Perfect World has done an incredible job of kicking the can down the street but soon it will be in their interest for Steam Global to exit stage left. Once Steam China is live, it's only a matter of time. After all, why would you bother creating a Steam China if Steam Global is still in operation? It makes no sense."

It's possible that Steam Global will continue to operate in China, perhaps for the same unknown reason it does now, but developers are clearly bracing for the worst. 

Steam China's beta starts on February 9 and will include Dota 2 and Counter-Strike: Global Offensive. More games are expected to roll out soon after.