Because China targeted video games

There is no peace for the Chinese giants of the digital and technological world. Beijing’s target is once again the online gaming industry. Published online and open for comments from the Chinese public until January 22, 2024, the new draft restrictions (a mechanism adopted by the Chinese government to consider the views of citizens who feel involved in the public debate by the regulatory authority) limit compulsive gambling behavior.

Against excessive spending and compulsive behavior

Especially those related to rewards earned through online games. Today, December 22, Chinese regulatory authorities announced a wide range of rules aimed at blocking “in-game” purchases, i.e. all microtransactions that occur within the game. Objects can be functions, powers; anything that allows you to beat a particularly difficult level or make the video game more personal. The new rules imposed by Beijing will effectively set spending limits for players. Video game platforms will not be able to reward players for logging in every day, spending in the game for the first time, or spending several times in a row during the game. In addition to banning reward features, video game companies must also limit the amount and frequency of loading their digital wallets for game spending. It is also planned to remove functions aimed at increasing game time. Pop-ups should be presented to warn users of “irrational” and therefore compulsive gaming behavior. The draft also reiterates a ban on “prohibited online gaming content that endangers national unity or harms national security and national reputation and interests.”

Over the years, Beijing has become increasingly harsh on video games. China set a strict gaming time limit for players under 18 in 2021 and suspended approval of new video games for nearly eight months. The end of the freeze on gaming licenses has raised hopes that interest in the industry is waning. The new rules also reflect Beijing’s concerns about user data and require game publishers to keep their servers in China.

More restrictions on big Chinese tech companies

The new measures could present a new headache for Chinese tech companies, which are often held responsible for enforcing and complying with government regulations on the use of social networks and online games. The proposal comes at a time of serious regulatory pressure on China’s tech giants.

The latest restrictions will affect companies such as Tencent, China’s largest online gaming company. Following the news, global industry leader Tencent in terms of revenue fell more than 10 percent in Hong Kong, while its rival Netease fell more than 20 percent. The new draft causes the shares of technology giants to collapse, as they close out a successful year following the Chinese government’s crackdown on the sector. China’s video game market returned to growth this year, with domestic revenue rising 13 percent to 303 billion yuan ($42.6 billion), according to industry association CGIGC.

Source: Today IT