Summary
China removed an official who helped oversee the regulation of its huge video games industry, following the announcement of controversial new gaming laws in December. These laws aimed to limit spending on video games, mainly by cracking down on microtransaction practices.
China unveiled its controversial gaming lawson December 22, leading to a massive $80 billion selloff in China’s gaming market within 24 hours. This caused the shares of China’s biggest gaming company, Tencent, to drop as much as 16%, and its next biggest gaming company, NetEase, to drop as much as 25%. It seems that these regulations and their massive financial ramifications might have ruffled some feathers throughout China’s government and top levels of industry, as policymakers have since announced that they would reshape these laws by listening to public feedback. It appears that the nation has already taken its first step in pushing back against the new set of regulations.
Reutersreportedthat Feng Shixin was removed from his position, according to multiple sources. Feng was the Communist Party’s Publicity Department’s head of publishing, which plays a major role in regulating China’s video games sector. The Chinese government has not officially announced Feng’s departure yet. Reuters' sources claimed that Feng’s removal was linked to the controversy surrounding China’s new gaming laws. This move might represent efforts from the Chinese government to alter these new laws, which haven’t been implemented yet.
While these laws were intended to help prevent gaming addiction among the Chinese youth, the industry’s massive drop in value from the announcement alone might have dissuaded the government from following through. Due to a deceleration of China’s economy in recent years, its government has tried to encourage investment in private sectors, something that these new laws were doing the opposite of.China’s video games sector reported a declinefor the first time in 2023, so these proposed regulations might have come at an especially bad time.
However, theChinese government is no stranger to implementing gaming lawsin efforts to protect its youth, so these laws may still be implemented, just slightly modified to be less extreme. Laws implemented in 2021 restrict those under 18 to three hours of online gaming per week. Also, minors cannot play between 10 PM and 8 AM, and can only play on Fridays, weekends, and public holidays. These extreme laws were intended to curb China’s apparently severe gaming addiction issues, and the government claims that they’ve worked so far.
