The proposed regulations for online gaming may soon be altered, according to Chinese officials. This is in response to the initial plan's significant financial losses for major technological companies.
On Saturday, the state television network, CCTV, announced that the government is considering the opinions expressed by different parties. It further said that the State Press and Publication Administration, the organization in charge of regulating the media, will consider these remarks and update the regulations as needed.
A proposal containing a number of regulations to restrict the amount of money and prizes that can be spent on online gaming was released by officials on Friday.
The biggest video gaming market in the world was immediately impacted by this action. Tencent Holdings and Netease, the two largest companies in China, suffered a significant loss in market value of up to $80 billion as a result of the quick and unfavorable response from investors.
Internet games will not be permitted to award prizes to users for making their first purchase in a game, signing up for daily sign-ins, or making several purchases in a row under the new rules. Usually, these techniques are employed to inspire gamers on the internet.
CCTV stated that some of the planned laws that prohibit promoting daily sign-ins and depositing funds to accounts may be revised by the authorities.
Over time, China has tightened its laws around video gaming.
Due to concerns about gaming addiction, it took a big stance against the gaming industry in 2021 by restricting the amount of time that people under the age of eighteen could play and halting the approval of new video games for around eight months.
The Chinese gaming industry saw its worst years in 2021 and 2022 as a result of stringent rules; revenues began to decline for the first time.
China modified its policy and started to accept new games last year. Still, the major goal is to restrict the amount of time and money children can spend playing video games.
The most stringent limitations yet were added in the most recent draft, which was made public on Friday. These include outlawing the sale of virtual goods through auctions and banning games that let kids use chance-based features to draw objects.
Beijing's concerns over user data are highlighted by these restrictions, which require gaming businesses to maintain their servers within Chinese borders.
The draft emphasizes how this year has seen a resurgence of growth in China's video gaming sector. Sales in the country have climbed by 13% to 303 billion yuan ($42.6 billion), according to the CGIGC industry organization.
In the future, China's big gaming companies may change the global video game market.
Shares of US and European video game businesses fell following an announcement on Friday. However, these declines paled in comparison to Tencent's 16% decline. Following this statement, Tencent's market capitalization dropped by $54 billion, according to Bloomberg News.
Until January 22, the administration is seeking public input on the regulations.
What do I think?
I think the new rules for online games in China might change again. The government said it would think about what people are saying. These rules were going to make it hard for games to give prizes or ask for money in certain ways.
Big companies like Tencent lost a lot of money because of this. China has been strict with games before, especially to stop kids from playing too much. But now, they might make some rules less strict. This could help the gaming business grow again. Everyone is watching what will happen next.
