In a significant move by the Chinese government, the Cyberspace Administration of China (CAC) has recommended strict limitations on smartphone usage for children under the age of 18. The proposed law, if implemented, would have major implications for technology companies operating in the country.
Shares of major Chinese firms, including Alibaba and video-sharing platform Bilibili, experienced a sharp decline in value after the news broke. This suggests that investors are concerned about the potential impact of these regulations on the companies’ revenues and growth prospects.
Under the proposed law, children will be permitted to use their smartphones for a maximum of two hours per day. Moreover, the CAC intends to enforce a complete ban on children accessing the internet on mobile devices from 22:00 to 06:00 local time.
To ensure compliance, industry players such as mobile phone manufacturers, app developers, and app stores will be required to develop a “minor mode” function to set usage limits based on age. The limits will vary, with children between 16 and 18 allowed two hours of screen time daily, while those under eight will be restricted to just eight minutes.
While these restrictions are meant to safeguard children’s health and well-being, critics argue that children can find workarounds, such as using their parents’ devices or circumventing the system. However, experts believe that similar gaming restrictions imposed four years ago have been relatively well implemented.
China has been actively addressing concerns over video game addiction among minors. In 2019, the country imposed a curfew on online gaming for children, with strict time limitations on gaming sessions. These measures were taken in response to concerns that excessive gaming was negatively impacting children’s physical and mental health.
The new proposed restrictions have raised concerns among technology companies operating in China. As the regulations would place the onus on these firms to enforce the rules, similar to the gaming restrictions, companies like Alibaba and Bilibili saw their share prices drop significantly. Tencent, another technology giant, also witnessed a decline in its share price, although it experienced a slight recovery on Thursday.
The increased regulation of the gaming industry in China has resulted in the US overtaking China as the world’s largest gaming market by revenue. This indicates that the measures taken by Chinese authorities to curb gaming addiction have had a significant impact on the industry within the country.
The proposed restrictions are currently open to public feedback, and it remains to be seen how the tech companies will adapt to these potential changes. While the intention is to protect children, the implications on the technology sector and China’s gaming market will need to be carefully monitored in the coming months.