China has unveiled new regulations aimed at curtailing excessive spending and time spent on video games, targeting in-game purchases and aiming to prevent addictive gaming habits.
These measures come as a blow to the world’s largest online gaming market, still recovering from previous regulatory crackdowns that affected the sector.
The proposed legislation caused a significant drop in the shares of tech giants, resulting in a collective loss of tens of billions of dollars in market value.
The regulations reiterate a ban on online game content deemed detrimental to national unity, security, or interests, extending beyond restricting spending and playtime.
In 2021, Beijing initiated regulations limiting gaming hours for individuals under 18 to one hour on Fridays, weekends, and holidays. However, the new restrictions are more far-reaching.
The National Press and Publication Administration (NPPA), the industry regulator, stated that online games must eliminate incentives encouraging excessive play and spending, including rewards for daily logins and account top-ups.
Analyst Ivan Su from Morningstar noted, “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 monetisation strategies.”
Additionally, the regulations will introduce pop-up notifications warning users of “irrational” gaming behavior, further reinforcing the aim to curb excessive gaming habits.
Source-BBC
