In a surprising twist, game developer Garena announced on September 4 that it would postpone the relaunch of Free Fire, its renowned battle royale game title, in India by several weeks. While the company’s initial plan was to reintroduce the game in the Indian market by September 5, the relaunch has not occurred as of November 7, with no official updates regarding a specific date.
Free Fire, which gained immense popularity since its launch in 2017, accumulated over a billion downloads on the Google Play Store by 2021. However, its ban in India significantly impacted the broader strategies of Sea, Garena’s parent company. In response to the ban, Sea revised its bookings for its gaming business, reducing the estimate of cash spent by users to around USD 3 billion in 2022, down from USD 4.6 billion the previous year.
This ban also had a substantial effect on Sea’s market valuation, resulting in a USD 16 billion loss in market capitalization within a single day. Notably, the ban occurred amidst a sell-off of Sea’s stock, with the company closing at USD 114 on March 17, 2022, far below its all-time high of USD 372. Prior to the ban, Free Fire had around 40 million monthly active users in India, highlighting its popularity.
In 2022, the alleged connection between the Chinese tech conglomerate Tencent and Sea raised concerns about data security and user privacy at Garena. Tencent is a shareholder of Sea, despite its limited involvement in Garena’s operations. Free Fire was not the sole target of the Indian government, with a bevy of other Chinese-associated or Chinese-developed apps also subjected to bans, including PUBG Mobile, a gaming title owned by Tencent Games.
To address these concerns and facilitate its return, Garena has taken several strategic steps. These include reducing Tencent’s stake in the company and engaging Yotta Infrastructure Solutions, a reputable data center operator in India. Yotta has been tasked with managing the personal data of Indian users on local servers and network connectivity services to support Garena’s product offerings in India, including esports.
Garena has also appointed Mahendra Singh Dhoni as its brand ambassador to reconnect with Indian audiences. Dhoni’s status in the cricket-crazy nation is expected to play a crucial role in the reintroduction of Free Fire, leveraging his popularity to resonate with Indian gamers and rebuild the game’s presence in the Indian market.
Garena emphasized the localization of Free Fire for the Indian market by relaunching it under the name Free Fire India. It intends to integrate unique content and foster an environment that prioritizes a safe, healthy, and enjoyable gameplay experience. The company has also announced measures to encourage users to take breaks at regular intervals, emphasizing its dedication to promoting responsible gaming practices.
While the wait for the relaunch continues, given the uncertainty surrounding a new release date for Free Fire India, it’s worth noting that users in India can still access Free Fire Max.
Free Fire Max is a variant of the game with the same mechanics but offers enhanced graphics and animations. Despite initial concerns, Free Fire Max remained unaffected by the ban and is currently the most popular mobile game in India, based on data collected between October 8 and November 7, 2023, according to SensorTower.
The impending return of Free Fire in India holds promise for Sea’s business trajectory in a critical market. The profits generated by Garena have been instrumental in funding Sea’s other subsidiaries, including the e-commerce platform Shopee and fintech company SeaMoney.
However, the impact on Sea’s finances should not be overestimated. After a hiatus of a year and a half, Free Fire players have likely transitioned to the enhanced Free Fire Max title, where they can continue their gameplay and carry over their in-game purchases. This transition causes minimal disruption, making the relaunch of Free Fire India more significant for players with lower-end devices that may struggle to run the game smoothly.