Internet & Tech

Battle of the bureaucrats

Government ministries clash over online game rules

Battle of the bureaucrats

Come on, we're waiting to play

A man in Wuhan took his pregnant wife to see a doctor. He was worried that she had some sort of disease as she got up in the middle of the night “too often” to drink water.

The doctor did the usual checks and declared that he couldn’t find anything wrong. The wife finally confessed to her nervous husband that she was actually addicted to playing online games.

“I was too guilty to admit to anyone I might be addicted. So I would sneak out in the middle of the nights to play the game,” she told the Changjiang Commercial Daily.

Good news for the husband. World of Warcraft – China’s most popular online game – is now banned on the mainland.

According to a statement last Monday, China’s General Administration of Press and Publications (GAPP) rejected NetEase’s application to operate Burning Crusades, the latest version of World of Warcraft (WoW).

The game, developed by California-based company Activision Blizzard, was previously licensed to another Chinese firm, The9.

In April, NetEase, the country’s second largest online gaming company, announced that it had acquired the game’s operating license in China for three years.

Pretty straightforward it seems. Well, not quite. Beijing requires new operators of foreign-made online games to apply for content approval even if the games have been through the process before.

NetEase duly launched the game after receiving approvals from the Ministry of Culture, another government regulator for online games. It assumed that would suffice – based on recent regulatory changes in the sector, says the 21CN Business Herald.

But GAPP then insisted that it is still in charge and ordered NetEase to stop collecting game fees from players or allowing new players to sign up for accounts. It even threatened to shut down the company’s internet access.

The Ministry of Culture hit back. Li Xiong, head of the regulator’s department of cultural markets, insisted the ministry had the sole right to regulate online games and that GAPP had overstepped its authority.

“As long as they are online, these games and publications are fully subject to administration by the Ministry of Culture,” says Li.

The central government has previously tried to clarify the responsibilities regarding online games. It seems that GAPP is responsible for pre-approval of online game releases, but once a game is released online it falls under the jurisdiction of the Ministry of Culture.

Industry observers expect the stalemate to continue until the State Council, China’s chief administrative authority, intervenes.

“At present, all online gaming companies are waiting to see what’s going to happen. Many companies have deliberately slowed down in their applications for approving new games,” says Zhao Xufeng, an analyst at IResearch Consulting. “It is, after all, a very sensitive period.”

Stuck in the middle of the power struggle, NetEase is begging the regulators to resolve the issue. Analysts think it could be losing Rmb4 million ($584,000) a day in revenue on the WoW shutdown. The game boasts 5 million registered mainland users, as of the second quarter of this year.

The stakes are high for the mainland’s online gaming market in general (see WiC10), which is forecast to reach Rmb27.7 billion this year, up from Rmb20 billion last year, says BDA, a Beijing-based consultancy.

In truth, infighting between regulators is commonplace in China’s bureaucracy, although this particular dispute is an unusually public example.

Game-players just want the matter resolved.

“[The dispute] is a show of the intensity of conflict between government agencies whose roles have not been clearly defined,” says Zhang Chao, who has been playing WoW for five years.

“Of course, players like us wouldn’t want to see the game suspended. This looks as if they are just messing around with things over a conflict of interest.”

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