Fresh curbs on online gaming announced
Chinese regulators announced on Friday a wide range of rules aimed at curbing spending and rewards that encourage video games, dealing a blow to the world's biggest games market which returned to growth this year. The new rules, which will effectively set spending limits for online games, sparked panic among investors, wiping off nearly US$80 billion in market value from China's two biggest gaming companies, as investors sought to gauge the potential impact on earnings and more restrictions in the offing. Online games will now be banned from giving players rewards if they log in every day, if they spend on the game for the first time or if they spend several times on the game consecutively.  All are common incentive mechanisms in online games. Shares in Tencent Holdings, the world's biggest gaming company, tumbled as much as 16 percent at one point, while those of its closest rival, NetEase, plunged as much as 25 percent after the National Press and Publication Administrations published the new draft rules. In 2021, China set strict playtime limits for players younger than 18 and suspended the approvals of new video games for about eight months, citing gaming addiction concerns. Under the new rules, games are required to set limits on how much players can top up their digital wallets for in-game spending. "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," said Ivan Su, an analyst at Morningstar. (Reuters)