China Regulator Surprises Gaming Industry With Nod For 105 Online Titles After Investors Burn Hands

In a surprising move, China’s National Press and Publication Administration (NPPA) has approved 105 online games. This development comes amid substantial financial losses experienced by major game companies due to proposed regulatory curbs.

What Happened: The NPPA publicized its support for the online gaming industry through a statement on its WeChat account, as reported by AP News on Monday. 

The approval of these games was characterized as a “positive signal” to foster the thriving and healthy development of the industry. Among the approved games were “Counter War: Future” from Tencent Holdings TCEHY and “Firefly Assault” from NetEase Inc NTES.

Proposed guidelines released last week aimed at curbing online gaming led to a sharp decline in share prices for top video game developers like Tencent and NetEase. The potential regulations included daily log-in incentives, restrictions on user recharge amounts, and purchase bans.

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These proposed measures led to considerable financial losses on Friday, with Nasdaq-listed shares of NetEase falling 16.1%, and its Hong Kong-listed shares dropping 25%. Tencent’s shares also closed 12% lower.

In 2023, the NPPA issued a total of 1,075 game version numbers, with 977 being domestically produced and 98 imported. The domestic online games market generated over 300 billion yuan ($42 billion) in sales revenue in 2023, with the number of gamers reaching 668 million.

Why It Matters: Before the NPPA’s approval, China’s top gaming regulator had introduced draft regulations to control excessive spending and online gaming use. This sudden move, announced just before Christmas, led to an $80 billion market selloff, with $54 billion attributed to Tencent. 

The new regulations, which included spending limits on in-game purchases, bans on rewards for frequent log-ins, and content restrictions, sparked fears of renewed crackdowns on China’s enormous internet sector. The NPPA’s recent approvals, however, may assuage some of these concerns, indicating a level of support for the industry despite the proposed regulations.

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Photo via Shutterstock


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