China Cracking Down on the Video Game Industry

The video game industry is one of the biggest forms of entertainment. With that said, China, in particular, is an important market for the industry. The country is the biggest consumer of the medium. In fact, China alone is projected to hit $49.3 billion in gaming revenues in 2021. Recently though the Chinese Communist Party (CCP) implemented eyebrow-raising policies. These regulatory policies are aimed squarely at the video games industry. With that in mind, we are going to talk about China’s video games regulations.

Video Games Regulation in China

Gaming has been booming and has become the forefront of entertainment. With that said, I find China’s video games regulations shocking. Since July 2021, regulators have not approved any new games to be released in the country. According to the South China Morning Post, we have learned that that the National Press and Publication Administration (NPPA), the regulatory body that oversees media content in the country, has not issued a new license for a video game since July 2021. In fact, the freeze was extended to 2022.

The extension will only increase more uncertainty about the industry’s future in China. Even more damning is the fact that Chinese authorities just banned Steam’s global digital storefront in December. The store didn’t last long as it just began operating in China in early 2021. It is more clear that the CCP is positioning itself against big tech companies in general and video games in particular.

As you imagine, it caused quite a stir with local Chinese publishers. Some have even called it quits and closed their doors entirely. This has caused severe consequences within China where local companies are leaving the business. Some of the bigger Chinese publishers and developers are trying to position themselves more overseas to keep their businesses afloat. Although China is currently enduring a debt crisis, it’s not clear whether this has an impact on the NPPA’s freeze or whether it is a consequence of all the recent video games-related closures. But it is certain that regulations are already taking a toll on China’s video game industry on a large scale.

Maintaining a Tight Lip

There have been some people trying to get some information and comments from the NPPA but to no avail. Speculations suggest that the regulator is keeping everything close to the chest when it comes to video games. It’s not surprising that the CCP is showing how vehemently it is against the video game industry. Once a state-owned news outlet even described video games as “spiritual opium”. This is deeply concerning because the CCP is seeking to curb the industry in an invasive way.

During the tail end of August  2021, China dropped a megaton of a hammer. Authorities decided to limit the time minors (18 and under) could play some games to just 3 hours a week. This is unheard of in other parts of the world and goes to show that the CCP is increasingly obstructing the video game industry by using invasive verification methods to record the playing times of minors. These methods include logging into a national portal that will begin timing gameplay.

China’s clampdown on video games is a symptom of larger-scale tightening going on in the country. The CCP is being incredibly heavy-handed with the majority of the biggest people within its tech industry. This includes companies like Alibaba Group and Tencent. We can be sure not to expect anything changing from the NPPA anytime soon. It will be a long dry season in China for the foreseeable future. But hopefully, the companies that did not close their doors can find greener pastures elsewhere.

The Uncertain Future of Video Games in China

It’s the Golden Age of Gaming. Play what you love and love what you play.

-Pong Soul

The video game industry continues to grow and maintains itself as a primary source of entertainment. We can only feel bad for what’s happening over there to an industry we all love. It doesn’t seem the CCP will loosen its grip any time soon. Hopefully, the firms that had to close can find new homes and prosper elsewhere. The companies that make it overseas we welcome you with open arms. Games like Black Myth: Wukong seems like exciting prospects by Chinese developers. Hopefully, things continue to move forward in a positive way for all video game developers and companies involved in the video games industry.