Honor of Kings is not just China’s most popular video game. The MOBA (Multiplayer online battle arena) mobile game has become a full-fledged phenomenon with 200 million players at its peak. But now gamers are dropping it, and it’s not just because they’re turning to even hotter games.

Known internationally as Arena of Valor, Honor of Kings lost about 34% of its monthly active users since last year, according to a report from Chinese market research company Analysys. The time spent playing the game also dropped by half.

The game’s declining user base coincides with a drop in popularity for the MOBA genre generally. The genre fell from first to third place in the mobile gaming category over the past year, according to the report, which also notes that 98% of MOBA gamers play Honor of Kings.

Fears of the game’s impact on children also aren’t doing it any favors.

Outside of China, Honor of Kings is mostly known as a mobile League of Legends rip off. However, inside the country, it’s known as the most vilified game. The game has been described as a “poison” that causes addiction among teenagers, not to mention claims of contributing to poor eyesight. (Officials have been less critical of another myopia culprit: excessive study hours.)

While Honor of Kings is insanely popular in China, it has also been accused of making teenagers addicted and undermining their combat readiness. (Picture: Honor of Kings)

This is why regulators called for restrictions on time children can spend playing games last year. In November, Tencent said its Honor of Kings gameplay restrictions of 1 or 2 hours per day (depending on age) would be expanded to all its games. The system relies on a real name verification system coupled with facial recognition to prevent things like stealing your grandfather’s ID card to play games.

Instead of MOBA, players are now looking into other mobile offerings such as first-person shooters and simulation games, which have become hugely popular among female players.

With one third of China’s entire population playing mobile games, it’s an important industry for Tencent, which rakes in more gaming revenue than any other company. However, time spent playing mobile games in China fell 6.2% in February 2019 compared with the same period last year, according to the Analysys report.

While this sounds like bad news for Tencent, Honor of Kings still made a mind-boggling US$2 billion in revenue last year, according to Sensor Tower.

This was the game's best year yet, which remains the top grossing game on Apple's App Store in China, Niko Partners analyst Daniel Ahmad told Abacus. The age restrictions have also had little impact on Tencent, he added, because minors are a small portion of spenders. Even with a 40% drop in playing time among minors, it's had little impact on earnings.

The important thing for Tencent is to keep its older users engaged, which it does in its flagship mobile game through a variety of means. 

"Honor of Kings has made a number of changes to keep players engaged recently," Ahmad said. "Last year a battle royale mode was introduced into the game, a new graphics and matchmaking system has also made its way into the game, more recently the company added a battle pass monetization option."

This opens the door to a new opportunity for Tencent, as the Analysys’ report suggests. As casual players get distracted by other games, Honor of Kings can focus more on hardcore players. Although MOBA games account for just 8.3% of the highest grossing mobile games in China, they account for nearly half of all esports revenue.

Even with the decline in users, Honor of Kings still has around 169 million monthly active users. That’s not a small number by any metric.