China's video gaming watchdog speaks out after draft spending rules roil market
People play online games in an internet cafe in Fuyang in central China's Anhui province, March 1, 2019. China's authority in charge of press and publications has approved 105 online games, saying it fully supports the industry after newly proposed curbs caused massive losses for major game companies. The National Press and Publication Administration issued a statement on its Weibo social media account, Dec. 25, saying the approvals demonstrate active support for the development of online games. AP-Yonhap
Draft rules to rein in spending on online video games are designed to promote "healthy development" in the industry, the regulator said on Saturday, a day after the announcement of the changes sent shock waves through the sector.
As well as clarifying conditions for game operation permits, the draft contained an entire chapter on "insurance and rewards" to encourage original games while also protecting minors and consumer rights.
Under the rules, online games will not be allowed to force players to fight each other, and must not offer rewards that entice people to excessively play and spend money.
"During the drafting process, we received suggestions from the government, industry associations and companies in many ways," the National Press and Publication Administration told the China Press and Publication News, its official paper.
"The regulator will take public concerns on the ... clauses into account and amend the regulations accordingly," it said, adding the draft would be open for public comment until Jan. 22.
All gaming-related stocks fell in Hong Kong on Friday, with Bilibili shedding 10.4 percent.
Shares in Tencent Holdings, the world's biggest video gaming company by revenue, closed down 12 percent to HK$274 ($35.07) on Friday, wiping out about HK$300 billion ($38.3 billion) worth of value, while NetEase lost 27 percent in pre-market trading in the United States.
Some online commenters questioned whether the announcement ran counter to the focus on growth and stabilization of market expectations that emerged from the agenda-setting central economic work conference in Beijing earlier this month.
The gaming industry is still recovering from the government's previous crackdown.
As part of a national campaign to reduce video gaming addiction among Chinese youth, Beijing issued new rules in 2021 limiting the game time for players aged under 18 to between 8pm and 9pm, and only on Fridays, Saturdays, Sundays and statutory holidays.
There was no reprieve during the summer, when Tencent reminded minors that they could only play a total of 21 hours from July 11 to Aug. 31.
The slow resumption of game licensing in China has also stalled the release of new titles. The administration stopped granting game licenses for eight months until April 2022, when it approved 45 titles, followed by 67 in July and 69 in August.
In 2022, China's total gaming industry revenue declined 10.3 percent year on year owing to economic headwinds, slower user growth and regulatory scrutiny.
Read the full story at SCMP