Chinese regulators have stepped up scrutiny of the domestic gaming sector over the past year and a half. But waves of new game approvals, and positive steps in improving gaming addiction in children under 18, could be positive signs that the crackdown is easing.
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Beijing is showing signs that its strong crackdown on the domestic video game sector could be eased, which could benefit Chinese tech giants. , including Tencent and NetEase.
On Tuesday, research firm CNG together with the China Game Industry Corporation Commission, affiliated with the game publishing regulator, released a report in which they praised progress in reducing addiction. games in people under the age of 18.
Regulators have been concerned for a while about gaming addiction among minors. Last year, the National Press and Publication Administration of China put in the rules restricted children under 18 from playing online games more than 3 hours per week.
The CNG report carries weight because it was published in conjunction with an important body of the video game industry that is affiliated with the regulator. The report says more than 70 percent of teens play games for less than three hours a week, and the teen’s problem of gaming addiction has “reached a step toward resolution,” according to a translation by CNBC.
The positive report could signal a more optimistic outlook for the Chinese gaming sector.
“China’s strict regulatory approach over the past year has been the result of a lack of enforcement and compliance in key areas,” Daniel Ahmad, senior analyst at Niko Partners, told CNBC. “With game companies now fully compliant, we’re seeing a more positive outlook beginning to develop.”
The CNG report also points to major Chinese game companies including Tencent and NetEase for their active moves in enforcing the protection of minors.
For example, both Tencent and NetEase use facial recognition to see if the game player is an adult.
Another positive sign came last week when regulators approved a batch of 70 new games for release. In China, video games need approval to publish and monetize. Among the approvals is a game titled Metal Slug: Awakening from Tencent, which marks the company’s first commercial game license in a year and a half, according to Reuters.
Last year, China froze game approval in the summer and only start green lighting game in April this year. But games from Tencent, China’s largest game company, was absent from the list until now.
Tencent management last week told analysts on its third-quarter earnings call that the company expects game licenses to be approved relatively quickly going forward, adding to signs of scrutiny. regulations for easing this sector.
Martin Lau, president of Tencent, said the company is seeing “positive signals on the path to macro and regulatory normalization.”
