Last week, the updated draft guidelines which are designed to curb online gaming in China were released, and soon afterwards the share prices of video game makers of Tencent and Netease plunged just before the holiday Christmas long weekend, wiping out over 80 billion of dollars and dragging Chinese market down.
In an effort to repair the damage the “National Press and Publication Administration” issued a statement via its WeChat social media platform, that said in part that the fast-tracked approvals over over 100 online games by the “Game Working Committee of China Music and Digital Association”, shows that they fully support the prosperity and healthy development of the online game industry within their country.
Some of the games approved was the popular “Counter War: Future” from Tencent and equally popular “Firefly Assault” from NetEase, but it will be interesting to see how the major leaders adapt to the new rules that aim in curbing in-game spending, banning reward features, and setting limits on how much players can top up their digital wallets.
“The removal of these incentives is likely to reduce daily active users and in-app revenue, and could eventually force publishers to fundamentally overhaul their game design and monetization strategies,” said Ivan Su, an analyst at Morningstar.
It will be interesting to see how the stock market recovers now that the holiday weekend is over, and markets will resume trading soon, and with their statement released on WeChat from the Game Working Committee, but this is not the first time China regulators have taken steps to control the online gaming sector, back in 2021 they limited the amount of time children minors could spend on games to just under three hours a week, in an effort to curb video gaming addiction with minors.