China is cracking down on online gaming and has limited it for minors to only 3 hours a week.
Those under 18 years of age can play from 8 p.m. to 9 p.m. on Fridays, weekends and on public holidays starting Sept. 1.
The screw has been tightened from earlier when children were allowed to play for 1.5 hours a day and 3 hours on public holidays.
Apart from children, the country’s largest technology companies will also be negatively impacted.
Stock Market Response
One such company is gaming giant Tencent, whose Honor of Kings enjoys global popularity, along with gaming company NetEase.
The stock market responded as Tencent’s stock price closed down 0.6% at 465.80 Hong Kong dollars on Monday.
New York-listed NetEase’s stock was down about 9% at the market’s open.
The reason behind China’s sentiment is that it believes tech companies are creating an overt influence on society.
China is also the world’s largest market for video games.
62.5% of Chinese minors play online frequently.
13.2% of minors have been found to play on mobiles for over 2 hours a day.
It is ostensibly tackling gaming and internet addiction in this manner.
Therefore, it mandated that minors use their real names and national identification numbers on their online gaming accounts which would help the govt pick them out.
Other measures it has taken include administering therapy and military drills to the concerned individuals.
Yet another justification is that it addresses the rising rate of nearsightedness.
To that effect, it suspended video game approvals for 9 months over myopic concerns.
Tencent had complied earlier this month when it said it would curb gaming time for minors to an hour a day and 2 hours during holidays.
It also placed a ban on children under the age of 12 on making in-game purchases.
It was prompted to make a move after a state-affiliated newspaper termed the gaming industry and their products “spiritual opium”.
Other Companies Affected
The tech firms on the country’s radar include those providing ubiquitous messaging, payments and gaming services.
It is not just gaming companies under fire but also e-commerce and online education firms accused of anti-competitive behavior after years of rapid growth.
Companies that provide tutoring in core school subjects were banned from making a profit
This led to billions being wiped out in market value from companies such as TAL Education and Gaotu Techedu.
In order to ensure compliance, regulators will be closely monitoring online game companies and increasing the frequency of inspections.
Notably, as of now there are no laws to punish people for infractions.
However, the regulator will soon introduce penalties for gaming firms found to be in violation.