China has announced new plans cracking down on certain tactics utilized in the way video games employ monetization and encourage engagement. Reuters first reported on the news.
The National Press and Publication Administrations in China released a new draft of rules that will ban several common techniques used in games like daily log-in rewards, bonuses for first-time spenders, and incentives to continue spending money in games.
Regarding loot boxes, game publishers in China will no longer be allowed to offer them to minors. Games that include loot boxes will need to allow players to purchase specific items from the boxes. Additionally, in-game items will not be able to be auctioned or used as speculative assets. Players will need to have spending limits imposed on them and publishers must run all servers in China for Chinese games.
If a video game shuts down, any unspent in-game currency must be refunded to players in real money at the exact rate it was originally purchased at.
China is also giving some room for game publishers with their regulators needing to approve games within 60 days of submission. The situation on approvals has been complicated for Chinese developers in the past, with there being a freeze on game approvals for several months in 2021 and 2022.
The new rules have caused shares at Tencent and NetEase to drop, with Tencent seeing a 16% decline and NetEase seeing a 25% decline.
The Chinese government has imposed restrictions on the games industry in the past before, limiting the playtime minors can have in games, banning livestreaming for those under the age of 16, and imposing stricter rules around depicting religion and gender.
The Chinese Games Industry is Known for its Gacha Mechanics
The industry in China is riddled with gacha games, which are also somewhat popular in Western countries. Games like Genshin Impact, Honkai Star Rail, and more all utilize similar monetization systems where players are encouraged to continue playing and continue spending to get all the cosmetics they want.
It has dipped into gambling in many of these free-to-play games, and the Chinese games industry has frequently pushed for these sorts of monetization schemes.
It’s unclear how these new rules will affect popular Chinese games in the West, but we may be seeing games like Genshin Impact dramatically reduce their monetization tactics.
The DZSH Group actually discussed this topic over on our gaming-centered YouTube channel, DZSH Gaming. You can watch that video below for more information on the topic of monetization in video games:
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Zainah Yousef
Zainah Yousef is the author of The Fallen Age Saga and specializes in gaming, social media advice, and reviews. She's been writing all her life and she probably won't stop anytime soon.
