Since 2021, there has been no fundamental change in the regulatory thinking of the gaming industry. Although the release of the version number will resume normal in early 2023, there are still some opinions in the market that the regulation of online games will enter a "relaxation cycle". However, the promulgation of the Measures for the Administration of Online Games (Draft for Solicitation of Comments) has shattered this naïve dream. In fact, the Measures continue the regulatory approach of the past few years, and the impact on the game industry is all-encompassing.
Among them, the online game approval system stipulated in Article 12 requires that game publishing and operation units must go online within one year after obtaining the edition number, which basically puts an end to the phenomenon of "hoarding the edition number". In the past, due to the uncertainty of the release time of the version number, game companies used to declare the version number after the game was roughly formed, and then make internal beta adjustments. Today, this strategy no longer applies, and companies need to plan their go-live more precisely.
For high-ARPU (**erage revenue per user) games, especially MMOs (massively multiplayer**) and SLGs (strategy games), the provisions of Article 18 have brought severe challenges to their commercialization models. This article prohibits the setting of inducing rewards such as daily login, first recharge, and continuous recharge, as well as the provision or connivance of virtual props** trading in the form of speculation, auction, etc. These regulations will have a direct impact on the monetization model of high ARPU games.
At the same time, the requirement that "all online games must set user deposit limits" has an impact on high ARPU games such as MMO, SLG, and ACG. Similar provisions have existed in the past, but the specific criteria are still to be clarified. This means that for these game types, the profit margin will be limited.
Article 27 The provisions on random drawing pose a threat to gacha games. Previously, gacha odds were the fun of this type of game, but the new rules require that random draws be accompanied by a direct purchase or redemption for the user. If strictly enforced, this will severely impact the business model of gacha games.
In addition, the Measures also regulate the supervision of Mini Programs. Article 63 states that the management of Mini Program games will be separately provided for by the competent authorities in accordance with the "Regulations on the Administration of Publications" and the principles of these Measures. This means that the "regulatory depression" status of Mini Programs may be about to disappear, and for small and medium-sized companies, it means a major adjustment.
However, the implementation rules of the Measures still need to be further clarified and refined, such as the specific criteria for user recharge limits and the setting of alternative channels for direct purchase. These implementing rules will determine the fate of many gaming products.
Overall, the impact of the Measures for the Administration of Online Games on the gaming industry is far-reaching. For high-ARPU games, small and medium-sized companies, and mini-program games, how to deal with the challenges brought by the new regulations will be the key to their future development. However, for large DAU (number of daily active users) and low ARPU games, such as casual, e-sports, social and other tracks, the impact is less. However, they also need to comply with the "no inducement bonuses such as daily logins, first deposits, and consecutive deposits".
In the face of this series of new regulations, gaming companies need to re-examine their business models and operational strategies. Only by adapting to and following the new regulatory environment can you gain a foothold in a highly competitive market.
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