China further limits kids’ gaming
New regulation part of crackdown on technology sector
BEIJING — China is banning children from playing online games for more than three hours a week, the harshest restriction so far on the game industry as Chinese regulators continue cracking down on the technology sector.
Minors in China can only play games between 8 and 9 p.m. on Fridays, weekends and on public holidays starting Wednesday, according to a notice from the National Press and Publication Administration.
That limits gaming to three hours a week for most weeks of the year, down from a previous restriction set in 2019 that allowed minors to play games for an hour and a half per day and three hours on public holidays.
The new regulation affects some of China’s largest technology companies, including gaming giant Tencent — whose Honor of Kings online multiplayer game is hugely popular globally — and gaming company NetEase.
“Some teenage kids just won’t listen to their parents’ discipline, and this policy can control them,” said Lily Feng, a company worker in Shenzhen, southern China.
She said her 10-year old daughter was less interested in online games than Douyin, the Chinese equivalent of TikTok, but added that the new limits set a good example.
“I think this is the right policy,” Feng said. “It amounts to the state taking care of our kids for us.”
Tencent’s stock price closed the day down 0.6%, at 465.80 Hong Kong dol
lars, on Monday ahead of the regulator’s announcement. Its market capitalization of $573 billion is down more than $300 billion from its February peak, a decline that’s bigger than the total value of Nike Inc. or Pfizer Inc.
New York-listed NetEase’s stock was down 3.4%.
Tencent, which already reduced the amount of time minors could spend on Honor of Kings, said it would abide by the new restrictions. In its latest financial disclosures, the company said that in the second quarter of 2021, players younger than 16 accounted for just 2.6% of its gross receipts for China gaming.
“Since 2017, Tencent has explored and applied various new technologies and functions for the protection of minors,” a spokeswoman for Tencent said in a statement. “That will continue, as Tencent strictly abides by and actively implements the latest requirements from the Chinese authorities.”
The gaming restrictions are part of an ongoing crackdown on technology companies, amid concerns that technology firms — many of which provide ubiquitous messaging, payments and gaming services — may have an outsize influence on society.
Regulators said in Monday’s notice that they would strengthen supervision and increase the frequency of inspections of online game companies to ensure that they follow the regulations closely. Other key points in the new rules include:
All online games should be linked to a state anti-addiction system, and companies can’t provide services to users without real-name registrations.
Regulators will ratchet up checks over how gaming firms carry out restrictions on things like playing time and in-game purchases.
Regulators will work with parents, schools and other members of the society to combat youth gaming addiction.
“While China’s government has been positive on video games recently and has promoted segments such as esports and cloud gaming as key growth areas, gaming addiction among minors is viewed as a negative output of the popularity of video games in society,” said Lisa Cosmas Hanson, president at research firm Niko Partners. China’s esports scene has grown considerably over the years, and players in esports typically train for hours a day at a young age, the firm noted.
It is possible for children to get around the ban if they were to use the accounts of adults, Niko pointed out. The government is asking for family cooperation to prevent that tactic.
The overall effect of the new ban is still unclear, as the government expands upon previous restrictions. Minors in China are already banned from spending more than about $62 a month on games.
Chinese authorities in recent months have targeted ecommerce and online education, and have implemented new regulations to curb anticompetitive behavior after years of rapid growth in the technology sector.
Last month, authorities banned companies that provide tutoring in core school subjects from making a profit, wiping out billions in market value from online education companies such as TAL Education and Gaotu Techedu.
Console gaming in China was banned for over a decade, up until 2015. Even today, most gamers in China gravitate toward PC and mobile gaming, with companies like Nintendo and Sony slowly making inroads in often minuscule console sales.
Last week, the Chinese government initiated a crackdown on teen celebrity worship and fan clubs, warning that celebrities’ pursuit of online followers was warping youths’ values. China’s Cyberspace Administration on Friday banned ranking celebrities by popularity.
Earlier last week, South Korea announced it would end a law that kept people under 16 from playing games between midnight and 6 a.m. Parents and guardians can instead arrange times for children to play.