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Unity China officially splits from its parent company



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On August 9, 2022, Unity Technologies, an American company developing software for video games, officially announced the creation of a joint venture in China based on its Chinese subsidiary, Unity China. This new entity will separate from Unity Technology so that it can develop its activities without facing the restrictions imposed by the Middle Kingdom on American companies.

A billion dollar agreement for the new entity Unity China

Since the arrival last year of regulations on the processing of personal data in China and with the accumulation of measures to regulate the video game market, Unity Technology had been considering for several months to split from its Chinese subsidiary, Unity China. It is now done for the branch which arrived on the territory in 2012 and whose flagship game engine is at the origin of several successful games such as Honor of Kings or Genshin Impact.

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In a press release, Unity announced that an agreement has been reached to form a joint venture with several investment partners. Alibaba Group Holding, China Mobile, OPPO, ByteDance, PCI Technology Group, and G-Bits Network Technology Xiamen have all invested in this new structure for a total of one billion dollars. Note that Unity will remain the majority shareholder and will be present on the board of directors in order to be able to control this new joint venture.

Unity wants to continue its growth in China

Junbo Zhang, who currently serves as Unity’s general manager in China, will lead the joint venture as chief executive officer. In 2021, China’s video game industry generated total revenue of nearly $47 billion, up 6.4% from the previous year.

By carrying out this maneuver, Unity hopes to be able to impose itself in this strategic region despite the vast campaign led by Beijing to curb the growth of the major digital players. By gradually moving away from its Chinese subsidiary while maintaining some control and allying with the country’s technology giants, the American firm believes it can circumvent or mitigate Chinese sanctions. In addition, the company must deal with the tensions that reign between the Middle Kingdom and the United States, tensions that can be explained, among other things, by the technological race in which the two nations are engaged.

As for the future, Junbo Zhang affirmed last July for 36kr that the company plans to hire around 1,000 engineers and software developers in China over the next three years.




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