China the video games sector under pressure

Panic on the Chinese video game market. An article from the economic newspaper Information Daily has grown the actions of video game companies. These are the words used that shocked. Online games are considered an addiction. A semantics validated by Chinese censorship, the economy log being a state newspaper.

These terms have frightened investors, and Tencent, the Chinese giant video game has lost up to 10% on the Hong Kong Stock Exchange Tuesday, August 3. Chinese power was surprised by this over-reaction of the markets. The article has been removed in the afternoon, then republished without the provocative words. Shares are reset.

Honor of Kings in the viewfinder

It is above all a game of Tencent, honor of kings, a role play based on Chinese historical characters (a kind of league of legends) that is targeted. It’s more than a phenomenon in China. Between 100 and 200 million users, an income of one billion generated per year. This game was created for smartphones, not for computers, which attracts more people. In honor of kings, players compete online and spend money (virtual) to acquire artifacts, additional skills, new costumes. By reading the article that assimilates players to drug addicts, investors understood that the Chinese government planned to strengthen the regulation of this market. Perhaps it will be more difficult, in the future, to buy a super-power?

The Chinese regime, explains that if it wants to regulate, it is for reasons of public health. Some teenagers play eight hours a day. This leads to inactivity, sight problems. Tencent promised that he would take new measures. To comply with the Video Games Act, 2019, he had already announced in early July that he set up a facial recognition system to prevent minors from playing between 10pm and 8am. When registering, we must give his identity card. Then the game compares the photo and the face, and goes out if you have under 18 years.

Take up in the digital sector

This article is published in a context where the Chinese regime tries to take control of the digital giants. Since 2017, the plan has launched a redesign of the market regulatory system, especially for digital companies. Anti-monopoly law, regulation of data collection, fines etc … companies like Alibaba, Huawei, Tencent, are targeted.

In fact, China is trying to find a new system, because in a more and more digital world, these giants will become even more powerful, they will have an even more central role in the coming years. These mega-companies are strategic and what the communist power is not used to it is that they are deprived, before, it was public conglomerates. The size of these companies is considerable, both by the number of employees, and their valuation and billions of dollars they generate every year. _ These companies are in extremely sensitive areas _, explains Antoine Bondaz, a researcher at the Foundation for Strategic Research and China’s specialist, they have a vital role to the control of populations (surveillance , propaganda, censorship), they are also fundamental for the control of information technologies and finally, they are strategic for innovation. _

Beijing seeks to regulate them economically (it’s in progress) and to control them politically. This political surveillance is one of the challenges of the next few years. Shaping these companies, influence the content of what they propose to better control the population. In 2019, the application _ Xuexi Qiangguo _ is for example exit to _ learn the thought of Xi Jinping _. It would be used to spy on Chinese smartphones according to a German cybersecurity company.

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