(Credit: Transcript by OpenAI Whisper)
China is softening stance on gaming after $80 billion route. China approved 105 domestic games on Monday. The latest indication that Beijing is softening its stance after its move to tighten industry restrictions led to a $80 billion route last week. The titles included those operated by Tencent Holdings Ltd. and NetEase Inc., China's two leading game publishers that have been pummeled by Beijing's new rules. Monday's approvals show the Chinese authorities support the development of online gaming, an industry association said in a post on WeChat republished by the official Xinhua news agency. Chinese officials rekindled fear that they will start another round of tech crackdowns after top gaming regulator National Press and Publication Administration announced on Friday new rules to limit the development of online games, including an unspecified cap on spending by adult players. Additional restrictions include a ban on rewards for frequent logins and forced player duels, and even a prohibition on content that violates national security. As Tencent and NetEase saw their market value plunge by tens of billions of dollars in Hong Kong on Friday, the NPPA announced during trading hours the approval of 40 imported gaming titles, including those operated by the two companies. The move did little to help restore investors' confidence. Read, Tencent leads $80 billion route as China rekindles crackdown fear. Several analysts including those from Citi also said shortly after the new restrictions came out that Tencent and NetEase should not be significantly affected, but that did not prevent the shares of both companies from tumbling in U.S. trading. The administration said on Saturday that it will listen to feedback from stakeholders including companies and players to improve the rules. The sweeping restrictions, which caught industry players and investors off guard on the final trading day before Christmas, reminded many of the brutal tech sector crackdown of 2021. That year, various agencies abruptly imposed curbs on sectors from e-commerce to entertainment, reigning in Jack Ma-backed Ant Group Company and Alibaba Group Holding Limited while decimating the online education industry by declaring profits illegal. The latest events reflect the government's desire for a larger, more diverse gaming landscape with innovative content of a higher quality but one without excessive monetization or pay to win games, Yang Wenfeng, a senior vice president with Shanghai-based game studio Paper Games said. The government prefers publishers to earn profits through fair practices and product innovation, rather than deepening monetization strategies. Read, Asia Game Stocks Mixed As China Moles Revising New Curbs.
Key takeaways from the article "China is softening stance on gaming after $80 billion route" are:
Approval of New Games: China's approval of 105 domestic games, including those by Tencent Holdings Ltd. and NetEase Inc., indicates a softening stance after previous restrictions that led to significant market value losses for these companies.
New Regulatory Measures: Despite the approvals, China's National Press and Publication Administration introduced rules to limit online gaming development, including spending caps and content restrictions, rekindling fears of a renewed tech crackdown.
Government's Balanced Approach: The latest developments suggest China's aim for a more diverse and innovative gaming landscape, emphasizing fair profit-making practices and product innovation, while curbing excessive monetization and 'pay to win' strategies in the gaming industry.