China cuts online gaming time for minors to 3 hours per week

On Monday, China went further to prevent gambling addiction among minors by reducing the time they can spend playing online games to just three hours a week.

Users under the age of 18 can only play online games from 8 p.m. to 9 p.m. on Fridays, weekends and holidays, according to a document released by China’s National Press and Publication Administration.

Real-name registration and logins will be strictly enforced, the notice said, adding that companies cannot offer games to users who fail the identification process.

China has tightened controls on online gambling for minors in recent years. In 2019, the country reduced time limits to 1.5 hours per day and three hours on weekends and holidays.

Earlier this month, Xinhua affiliate Economic Information Daily in an article called online gambling a “spiritual opiate” that harms Chinese teenagers.

Tech giant Tencent, labeled as one of the “troublemakers” in the article, soon pledged to push for tougher restrictions on teens’ access to its flagship mobile game, “Honor of Kings”.

The company said it would start with “Honor of Kings” to reduce the time teenagers spend playing video games and ban children under 12 from spending money on games.

On Tuesday, “Honor of Kings” said it would abide by the new rules, continuously improve anti-addiction measures and temporarily halt its standalone mode.

“Given the contribution of teenagers to mobile game and online game revenue is relatively small, this (the restriction) will not have a big impact on business performance,” said Meng Lei, China equity strategist. at UBS, during a conference call on Tuesday.

In the second quarter, gamers under the age of 16 accounted for 2.6% of Tencent’s gross domestic gaming revenue, according to the company.

NetEase, another Chinese internet company, which derives 70% of its revenue from online games, said users under the age of 18 account for less than 1% of its total revenue.

“Right now, the data we estimate indicates that the financial impact (of the rules) is less than 1%,” NetEase CEO Ding Lei said in a conference call Tuesday after the company released its second-quarter performance.

“Most of the changes will be visible in traffic. For example, when the gaming user population decreases, it may have a partial impact on player activity,” Meng said, adding that changes in valuation and corporate profits “need to be measured more.”