China made an abrupt about-face this week when its gaming regulator approved 105 new domestic game titles just days after announcing strict new industry rules. The approvals suggest Beijing may be softening its stance after the new restrictions triggered an $80 billion stock rout for gaming giants Tencent and NetEase.
The National Press and Publication Administration (NPPA) approved 40 imported games during trading hours on Friday. But this did little to calm investors, as Tencent and NetEase shares continued falling sharply in Hong Kong and U.S. markets. Investors worried the rules – including caps on adult playing time and bans on game features like forced player duels – recalled Beijing’s brutal 2021 tech crackdown on sectors from e-commerce to education.
However, industry groups welcomed Monday’s announcement of 105 approved domestic game titles. The approvals included many Tencent and NetEase games, showing regulators aim to support online gaming development. The administration also said Saturday it would solicit feedback from companies and players on improving rules.
Analysts believe the new rules target excessive monetization rather than major developers. As Shanghai-based Paper Games executive Yang Wenfeng noted, “The government prefers publishers earn profits through fair practices and product innovation, rather than deepening monetization strategies.” While painful in the short term, regulation forcing the industry toward more ethical practices may benefit players and innovators.
The wild swings in sentiment around China’s gaming rules exemplify the uncertainty companies face navigating tech regulations. But this week’s approvals offer hope that transparent communication between regulators, industry and the public can lead to balanced oversight supporting innovation in emerging technologies.