Source- Tech Wire Asia
China has reportedly removed a key official from its press and publications regulatory body following the recent upheaval in the gaming industry due to proposed rules aimed at curbing excessive spending on video games. Feng Shixin, who previously served as the head of the publishing unit within the Communist Party’s Publicity Department, was ousted from his role last week, according to sources familiar with the matter.
Unconfirmed Departure and Regulatory Impact
Although the Chinese government’s State Council Information Office, responsible for addressing media inquiries and personnel matters, has not responded to requests for comment, sources suggest Feng’s removal is connected to recent measures introduced by the National Press and Publication Administration (NPPA). These rules triggered a significant downturn in the stock prices of major players in the global gaming sector, including Tencent.
The Fallout from Regulatory Measures
The NPPA’s announced measures, designed to curb excessive spending in gaming and limit rewards incentivizing gameplay, led to widespread concern within the industry. This concern resulted in a staggering $80 billion decrease in the combined market value of China’s top gaming companies. Investors, already wary of potential regulatory changes, witnessed a dent in confidence, impacting the market at a time when Beijing aimed to foster private sector investment for economic rejuvenation.
Following the initial announcement, the NPPA softened its stance in response to public feedback, expressing intentions to refine the rules after considering public sentiment. However, this reassessment followed days of turmoil in the market and widespread apprehension among investors.
A Recovery Amidst Turmoil
China’s gaming sector faced severe governmental restrictions in 2021, including stringent playtime limitations for minors and a suspension of new game approvals for around eight months. This crackdown, driven by concerns about gaming addiction, was part of a broader regulatory tightening across various sectors, causing 2022 to be the industry’s toughest year, witnessing a decline in overall revenue for the first time.
Despite the challenging regulatory landscape, China’s gaming market experienced a resurgence in 2023, registering a 14% increase in domestic revenue, reaching 303 billion yuan ($42.47 billion), as reported by the CGIGC industry association.
The removal of Feng Shixin amid these regulatory shifts suggests ongoing turbulence within China’s gaming industry. As authorities navigate the delicate balance between regulation and growth, stakeholders await further developments that could significantly shape the future of gaming in the country.
