China’s government implemented a new gaming policy on 30th August 2021. It was believed to be the strictest gaming policy to be ever implemented by China’s government.
What is China’s Latest Gaming Policy?
Those under the age of 18 would be permitted to play online games only between 8 pm to 9 pm on Fridays, Saturdays, Sundays, and public holidays. This policy aims to protect the mental and physical health of the underage.
Reaction from Gaming Platforms
Right after the announcement of the new policy, China’s two leading gaming platforms – Tencent, and NetEase; immediately released a notice that they will be providing their full cooperation.
This means that any underage users of Tencent and NetEase will only be allowed to play online games for a maximum of three hours per week (excluding public holidays).
The Impact on the Gaming Industry
After the gaming policy was announced, the shares for Tencent and NetEase fell almost 3% and 2.9% respectively in the Hong Kong afternoon trade on 31 August 2021.
Jefferies Group analysts mentioned that the new policy is likely to have a 3% impact on Tencent’s profitability. This is on assumptions gaming accounts for 60% of the company’s total sales. They also predicted that smaller competitors like NetEase would have less impacts. According to BBC, foreign investment in the gaming industry was also believed to be affected because of the new gaming policy.