In yet another sign that Beijing might be gearing up to ease its ongoing crackdown on the games industry (opens in new tab), China's top gaming industry association released a report today declaring that the problem of gaming addiction among Chinese youth has been "basically resolved". Well, I guess that wasn't so hard, was it?
The Financial Times (opens in new tab) reports that China's Game Industry Group Committee—which is affiliated with China's government gaming regulator—found that 70% of Chinese minors now play less than three hours of games a week. That's after the Chinese government restricted under-18s to playing online games for only one hour (opens in new tab) a day on Fridays, Saturdays, and Sundays back in 2021.
The news comes hot on the heels of an editorial in last week's government-owned People's Daily newspaper (opens in new tab), arguing that China couldn't afford to ignore videogames when its rivals in the EU and US were affording them "extremely high economic, technological, cultural and even strategic value". Chinese gaming stocks rose, taking the editorial as a sign that Beijing was about to soften its previously hardline position against games and the wider tech industry. With the publication of this report, it looks like they might have been right.
The atmosphere in the offices of Tencent and NetEase must be a potent mixture of trepidation and excitement. China's biggest and most recognisable games companies have endured the worst of the government's policy of neglect: struggling to obtain approvals for their games and—in the case of Tencent—losing the position of China's most valuable company to a liquor firm (opens in new tab). I can only imagine there are a lot of white knuckles at those companies right now as they wait to have the rug yanked out from under them.
Experts who spoke to the FT said that, while overall approvals will be fewer and censorship tighter compared to pre-crackdown years, they expect to see the freeze on game approvals end from the beginning of 2023. Meanwhile, Tencent said in an earnings call last week that it was now "fully compliant" with Chinese regulations and that it expected to receive more approvals in future.