India blocks Krafton’s game on concerns over data sharing in China – source

Battlegrounds Mobile India game and logo are seen in this picture illustration, July 29, 2022. REUTERS/Dado Ruvic/Illustration

NEW DELHI/SEOUL, July 29 (Reuters) – India’s government blocked a popular battle-royale format game from Krafton Inc (259960.KS), a South Korean company backed by China’s Tencent (0700.HK), as it was concerned about its data sharing and mining in China, an Indian government source said.

New Delhi used powers it has under India’s IT law to block Battlegrounds Mobile India (BGMI), relying on a provision it has invoked since 2020 to ban several other Chinese apps on national security concerns, said the government official and another source with direct knowledge.

The Indian government has not publicly announced the blocking. But the app was removed from Alphabet Inc’s (GOOGL.O) Google Play Store and Apple Inc’s (AAPL.O) App Store as of Thursday evening in India.

The removal of BGMI, which had more than 100 million users in India, comes after the South Asian country’s 2020 ban of another Krafton title, PlayerUnknown’s Battlegrounds (PUBG).

The PUBG crackdown was part of New Delhi’s ban of more than 100 mobile apps of Chinese origins, following a months-long border standoff between the nuclear-armed rivals.

The ban has expanded since to cover more than 300 apps, including popular gaming app ‘Free Fire’, owned by Singapore’s technology group Sea Ltd (SE.N).

Tencent held a 13.5% stake in Krafton as of end-March through an investment vehicle, according to Krafton’s regulatory filing.

Krafton shares slumped more than 9% on the news on Friday, later paring losses to close down 4.5% in Seoul. The company said in May India accounted for a high single digit percentage of its revenue in the first quarter of this year.

Tencent Holdings shares fell 4.9% to their lowest since March 15.

A Google spokesperson said it blocked the game following a government directive, while India’s IT ministry and Apple did not respond to requests for comment. The sources declined to be named as such orders are confidential.

The Chinese embassy in New Delhi did not immediately respond to a request for comment.

In Seoul, a Krafton spokesperson said the developer was talking to relevant authorities and companies to figure out the exact situation regarding the suspension in the two major app stores in India.

Krafton’s India CEO Sean Hyunil Sohn told news portal TechCrunch earlier this week that the Indian government had previously noted that PUBG and BGMI are different games, adding that “BGMI complies with all guidelines” in India.

‘CHINA INFLUENCE’

India invoked a section of its IT law, called 69A, to impose the ban, the two sources with direct knowledge told Reuters.

The section allows the government to block public access to content in the interest of national security, among other reasons. Orders issued under the section are generally confidential in nature.

Swadeshi Jagran Manch (SJM) and non-profit Prahar had repeatedly asked the government to investigate “China influence” of BGMI, Prahar president Abhay Mishra said. SJM is the economic wing of the Rashtriya Swayamsevak Sangh, an influential Hindu nationalist group close to Prime Minister Narendra Modi’s ruling party.

“In the so-called new avatar, the BGMI was no different from erstwhile PUBG with Tencent still controlling it in the background,” Mishra said.

The ban elicited strong online reactions from popular gamers in India on Twitter and YouTube.

“I hope our government understands that thousands of esports athletes and content creators and their life is dependent on BGMI,” tweeted Abhijeet Andhare, a Twitter user with more than 92,000 followers.

Reporting by Aditya Kalra and Munsif Vengattil in New Delhi, Joyce Lee in Seoul; Additional reporting by Nupur Anand; Editing by Kirsten Donovan, Clarence Fernandez and Muralikumar Anantharaman

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