Playing by the rules: Analyzing policy making and regulations surrounding China’s online gaming industry during the 13th Five-Year Plan period (2016-2020)

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Playing by the rules

Analyzing policy making and regulations surrounding China’s online

gaming industry during the 13

th

Five-Year Plan period (2016-2020)

Maarten Cremers, s1370561 m.n.cremers@umail.leidenuniv.nl

15-07-2020

MA Thesis Asian Studies (60 EC) Supervisor: Dr. Rogier Creemers

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1. Introduction

On the foundation day of China’s Central Cybersecurity and Informatization Leading Group, Xi Jinping spoke the words: “without cybersecurity there is no national security, and without informatization there is no modernization”. Under the current Chinese general secretary and his administration, the Chinese Communist Party (CCP) established several offices and introduced multiple plans that focus on developing key issues such as cyberspace governance and the digital economy. The CCP considers it its plight to modernize the country and make it a stable and innovative global competitor/leader with a well-backed middle class, while at the same time set future technology standards.

One aspect of such modernization is the technological development of the online gaming industry that has been growing almost exponentially in revenue over the last two decades and has plenty of room for further economic investment, technological standardization and norm setting. Since a few years, China holds the world’s biggest and hottest gaming industry that almost topped 230.88 billion yuan in revenue (an increase of 16.44 billion from 2018) in 2019 and with more than 640 million Chinese citizens playing (2.5% more than 2018) (GPC & IDC, 2019).

The CCP is supportive of the development of online gaming, but demands a tight control over its contents and the flow of information. Despite being an extremely large and potential industry, games in China are still exposed to heavy censoring and selection processes that relatively slow down the industry. Foreign products are scarcely seen, numerous of games are banned and game publishing companies need to have multiple licenses and a monetization approval to be able to distribute video games and generate revenue. A variety of ministries, including the Ministry of Culture (MOC) and the State Administration of Press and Publication (SAPP) are in charge of market oversight, but the regulatory environment has known struggling periods of fragmented ruling grounds and has been outpaced by the fast-developing technical challenges of the game industry.

The current administration led by Xi Jinping has not abandoned governance of the industry, in turn for profit and development. On the contrary, over the last decade, relevant ministries have been issued to update the legal framework and to adapt their regulations to the policy line of the party. Since his rise to presidency, Xi Jinping has focused on digital control with CCP-approved content

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within the digital network of China, which also includes online gaming. The regulations surrounding the gaming industry have changed significantly (especially with the rise of mobile games), but there is little scholarly work that has analyzed what has changed and, more importantly, why. To answer these questions, I have decided to jump in the gap of missing literature and analyze from a macro perspective the governmental changes made to this exceptionally fast-rising industry. To get enough insightful information, but stay within a relatively researchable scope, I have chosen to analyze the whole period of China’s top economic national plan: China’s 13th_{Five-Year-Plan.}

This thesis aims to find out how the Chinese government during Xi Jinping’s presidency has projected its national plans on the Chinese gaming industry. The main question that this thesis will try to answer will be: What changes in the regulatory environment of the Chinese gaming industry have been brought about during the 13th Five-Year Plan period (2016-2020) and what policy making has incentivized these changes? The motivation of this thesis is based on the fact that there is hardly academic research on government regulation of the online gaming industry in China. What is even more important is that the growth of the online gaming industry and the amount of regulations by the government has increased to such an extent, that most of said scholarly work is already outdated. I believe that by tracking the changes in the regulatory environment and providing an update, one can see towards what direction the CCP metaphorically is changing its course to.

This thesis consists out of multiple layers. I will start with providing an extensive literature review on media governance and the purpose and development of cultural industries in China. Then, I will present my methodology, which consists out of a small context of legislation in China and analyzing a selection of political documents. Going on, there will be a part that gives a necessary context of China’s online gaming industry, provided with a small part of the history of gaming in China and the introduction of its regulators, their influence and their governing struggle. The main question will later be presented and answered in a part that covers the time period of the 13th Five-Year Plan (2016-2020) and extensively addresses the 2018 game license freeze. My findings are supported by primary sources such as plans, laws, notices and departmental regulations issued by relevant government bodies. Their purpose is to point out changes to the law and support, or even contradict, the practices of the executive powers.

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By checking the official websites of the relevant authorities and consulting databases, I have zoomed in on the policies, laws and regulations that not only contain “online gaming” (网络游戏) in their documents, but also cover the field that games are developed in, namely the cultural industries.1 I have found that the regulatory environment after 2016 has changed notably. New laws and regulations have been introduced to try to cover the fast-rising gaming industry and all its challenges it brings along. With a mixture of international ambition and domestic control, the CCP has provided clear aspirations how to tackle the dilemma of the gaming industry and has instructed relevant governing bodies to make work of these aspirations. Furthermore, I have discovered a notable increase of party influence in state territory after the changing of executive oversight in a 2018 government overhaul, that I have concluded as a sign of Xi Jinping’s wish for a stronger ideological foundation in society.

2. Literature review

The Chinese gaming industry is subject to a great variety of different aspects of theory that explain its development. While this thesis draws from many theoretic fields, it will mainly focus on Chinese governance of media, cultural industries and policy making. In this literature review I will address several themes and corresponding perspectives that, in my opinion and that of other scholars, are important enough to support my research how and why the Chinese government is keen on controlling the industry and values updated regulations. Defining forces such as the state, market and players will be elaborated on, in order to fully understand the shaping of the industry.

First, I will discuss the works of observers that address the emergence of new media and internet governance in China, which will help support my research in contextualizing the role of the Chinese government when dealing with new media, the challenges it brings about and the dynamic relationships between multiple actors. Then, I will use other scholar’s works and discussions to describe the emergence and importance of cultural industries, to help me identify a global shift

1_{It is important to notice that the phrase “gaming” could also refer to real-life gaming, such as arcade halls and}

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towards the value of (digital) cultural products. For China, this especially includes reasons to enhance international soft power and increase domestic nationalism.

2.1. Chinese media: New media and internet governance

Scholars have conducted extensive research on the governance of Chinese traditional media (newspapers, TV, radio). Their work concludes that the CCP considers it its duty to reform Chinese society and legitimize itself as the strong ruler of the Chinese people and sole actor that can transform China into a harmonious and prosperous country. Maintaining the legitimacy of the party (and thus the rule over China) is the top priority of the CCP and main guideline of reasoning when governance and state intervention is considered. Therefore, the CCP identifies control over media and steering the national discourse as a necessary priority for upholding the political status quo of the Chinese political system. That is why traditional Chinese media, unlike in the West, is state-regulated and tightly controlled. Xi Jinping himself proclaimed that to uphold the party legitimacy and adhere to the unity of the party and the people, all media “must be named ‘party’ (必须姓党)” (Chai, 2016).

The desire to guide public opinion according to the core values of the CCP has led to a sophisticated propaganda apparatus, who’s primary focus it is to exert control over the media environment and guide discourse (Shambaugh, 2007; Brady, 2008; Stockmann, 2013).23 The emergence of new

media however, urged the party to adopt a new and more flexible (or anticipating) stance towards media governance. The market surrounding new media was dominated early on by non-state actors (Creemers, 2016; 2017) and developed an entirely different dynamic than the traditional media market. To ensure growth and development, the Chinese government extensively invested in technological success and improvement by providing loans and tax cuts to private enterprises and essentially letting them run the market.

2_{However, this does not mean that the Chinese media environment solely includes propagandistic content. On the}

contrary, scholars such as Schneider (2016) believe that due to liberalization, the market has developed a high diversity of topics in the media, primarily stemming from the cultural sector.

3_{For great insight in Chinese media directives behind doors, check the ministry of truth (Minitrue) messages on the}

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However, at the same time, a party-enterprise convergence can be observed with the establishment of groups such as the Internet Society of China (ISC). Notable members included Jack Ma from Alibaba, Pony Ma from Tencent and Robin Li from Baidu. Creemers (2018, pp. 173) notes a changing role of enterprises whose interests mutually overlap with that of the government. Especially during the increasing control over the internet under Xi Jinping, giant tech companies are included in decision-making bodies and, vice versa, party-state bodies are included in corporate managerial units.

The development of internet and networks also forges new power relations between the state and the public and “while ICTs are essential to economic development, they empower networks of communication that threaten the party’s political hegemony” (Esary & Qiang, 2011, pp. 299). To the CCP, events such as the Arab Spring and the Wenzhou Train crash have shown the power of new media. Not only have they demonstrated its speed and range in cyberspace, but also its strength by enabling collective activism. Unlike techno-critics such as Morozov (2009) (who argues that collective activism via the internet has often little social impact in real life, coining it “slacktivism”), the CCP fears that the Chinese public is capable of criticizing the rule of the party with a mobilizing factor and has realized the rising difficulty in covering up mistakes and failures. With internet and mobile technology, Chinese citizens have gained a means of communication that extends beyond their normal local community, confirming predictions of techno-positive scholars such as Shirky (2008) and Benkler (2006).

Throughout the years, the CCP has opted a flexible stance towards the governance of new media. Multiple scholars have found that the Chinese government adopts a careful strategy to adjust to the inevitable difficulties that new media provide. Dubbed “networked authoritarianism” by Rebecca Mackinnon (2011) the government allows citizens to voice concerns that have potential political impact to give a “much greater sense of freedom and may even feel like they have the ability to speak and be heard” (Mackinnon, 2011, pp. 33). Via multiple means such as blogs (Esarey & Qiang, 2008; Mackinnon, 2009; Strafella and Berg, 2015), microblogs (Marolt, 2011; King et al., 2013; Ng, 2013) (Sullivan, 2014)(Cairns & Carlson, 2016) and with the use of mobile phones (Liu, 2017), the government attempts to relieve pressure by providing citizens the opportunity to speak out against e.g. corrupt officials, which in turn enables the government to respond and demonstrate its

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role as a government that is listening.4_{In addition, it also benefits the process of policy making, as} it lets those who are affected by policy react to it.

By guiding discourse, setting parameters and making norms, the Chinese government is able to censor online content which is subjectively trespassing the boundaries of these parameters and norms, without losing its credibility. The popular believe that the censor mechanism of the Chinese government consists of filtering AI systems and labor-intensive manual censoring departments is only partly true. Rather, the government’s role is more of passive nature that makes companies and citizens work within a discourse framework given to them and creates a regulatory environment that is enforceable, should this framework not be upheld.

In practice, relevant state bodies have more than often released vague measures and regulations whose interpretation favor the government. These regulations most notably include statements that demand that the internet in China should not include online activities and content that could endanger national security and harm the harmonious society (which usually include topics such as violence, pornography, gambling, etc.). In addition to this, the government requires online operators to obtain a license (or various licenses) that enables them to operate their network system. If companies do not adhere to the aforementioned regulations, their license can be revoked, they risk financial punishment and the company can even be banned from obtaining a license again.

Regulations such as these invoke a self-regulating climate by companies and citizens alike. More than often have companies instilled filtering AI systems and manual censors to control and punish user content online. As a result, the users themselves become aware of the rules that are issued from above and refrain from publishing content that might get them banned from the platform (Ng & Landry, 2013).

Over the years, projects such as the Golden Shield and the Great Firewall of China have echoed the desire for protection of political stability against unwanted foreign influences, that would criticize China’s strict governance and provide harmful, unregulated content. These projects stem from the desire of cyber sovereignty, that involves no foreign meddling in domestic affairs in cyberspace. Although older in concept, that desire became more clear when Xi Jinping himself

4_{Depending on multiple factors such as the platform, topic and medium, this has the possibility to work}

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during the 2015 World Internet Conference in Wuzhen proclaimed that China was to become an internet superpower 网络强国 (wangluo qiangguo) (Xi, 2015).

China has been met with a notable “pivot” in internet governance with a more “security-oriented” focus since Xi’s rise to power (Creemers, 2015, pp. 9). The establishment of the Cyberspace Administration of China (CAC) and its centralization of power over the internet in 2014, display the sincerity of the government that desires to tackle the challenges of cyberspace (State Council, 2014). From its establishment, it has started cracking down on illegal matters such as vpn’s and drafted new laws, such as the National Cybersecurity Law, to regulate speech and content on the internet.

The governance of the internet and new media relates greatly to the gaming industry in China. First of all, games can be considered a new media in the sense that they contain a digital interactive aspect with the player through which information is delivered with content (plot, dialogue, visuals, etc.). Besides this, online games are enmeshed in digital spheres that include, for example, in-game chat with other players, but also cross over into other digital areas such as broadcasting (streaming services) and physical gatherings (gaming tournaments/e-sports). All of this includes massive flows of information that potentially could hurt the ideals of the CCP and therefore need to be monitored closely. Knockel et al. (2017) for example, found results that in-game words and phrases are picked up by a censoring apparatus, which withheld them from creating usernames and expressing in chat.

This strict monitoring of internet content has also shown remarkable results of circumvention of censorship online. Chinese internet users have shown various forms of creativity to bypass censorship systems for personal use and even in forms of protest. Scholars have found cultures emerging from event to event that often take satirical shapes (such as the use of homophones and homonyms), also regarded as the “playfulness” of the Chinese internet by Guobin Yang (2009). For games, this has also been the case as these methods of censorship evasion can be applied to the in-game experience, be it chat or design. A famous example is the War of Internet Addiction released by Machinima in 2010 that embodies an hour-long movie with in-game shots of the game World of Warcraft, in which players discuss the role of the state interference in digital play and the negative stigma of gaming in the public discourse. The movie is a perfect example of critique in a satirical way that managed to fool many censors. This cat and mouse game between censors and

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players is an ongoing issue for companies and the government that try to tackle this by updating regulations and implementing tighter, better enforceable systems.

Because gaming transcends simple online/offline binaries and instead is experienced by players in both the digital and physical world, the CCP arguably realizes that games enable equal, if not more, opportunities for activism comparable to the rest of new media, and thus should be regulated. Over the last two decades, multiple measures and regulations, such as MOC’s Interim Measures for the Management of Online Games in 2010, have been introduced to set parameters for developers and operators within they are supposed to work. These regulations are to forcefully shape public discourse to enable political stability, but there is another method of shaping, namely culture.

2.2. China’s cultural industries

Norm making is one of the tools that is available for guiding thought and discourse but is rarely truly successful when implemented forcefully. Rather, it can arguably be better achieved gracefully when those who are shaped would barely notice it. This is why cultural industries have gained such popularity over the last two decades. Cultural industries are a relatively new and fast-developing part of economies and are accelerated by globalization and the rise of the internet. They envelop the creation, production and distribution of goods that are cultural in nature.

As cultural products, games are able to provide experience to a player that, just like other cultural products, can be shaped (Ernkvist & Ström, 2008; Cao & Downing, 2008). Zhang (2008, pp. 47) describes the concept of games as a cultural product, because “Culture, ideology and even philosophy are embedded in games through storylines, rules and interfaces […] conceived by the developing team […] and their set of values and beliefs.” She also notes that while “all cultures have the concept of entertainment”, “a digital game is never as simple or universal as an entertainment concept may appear.” In other words, games are a valuable tool to shape public discourse by those who create it, but not everyone will experience games in the same way.

The Chinese government has realized the economic and political value of cultural industries (Tong & Hung, 2012; Su, 2015), but have also realized its lack of quality products, high rate of piracy and copycat behavior. From early 2000s on, the Chinese government has tried to alter China’s domestic production stigma from “Made in China” to “Created in China” (Keane, 2007). The

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cultural industries have become destined to be included in strategic moves for international use such as soft power (Keane, 2007, 2010, 2013; Barr, 2012; Shambaugh, 2013; Vlassis, 2016) and domestic strategies such as invoking nationalism (Schneider, 2018; Wu, 2007; Nie, 2013; Fung, 2016).5_{For a long period of time, this has meant that the cultural industries needed to be developed}

remarkably, in order to deliver quality based content. That is why the government has been keen on adjusting policy (targets and limitations) accordingly, on par with the quick advancing progression (globalization) in the era of the internet. Often this resulted in protective behavior such as “neo-techno nationalism” (Jiang & Fung, 2017).

Since its admission to the World Trade Organization (WTO) in 2001, the Chinese government has stepped up efforts to promote indigenous products and tackle the challenges of globalization that arose for its still underdeveloped market. Early on in 2003, profitable private enterprises were given the status to join the cultural industries and receive tax cuts (Su, 2015, pp. 523). In accordance with national strategies such as the Five-Year Plans that were designed to promote development of domestic industries, these enterprises were able to grow notably in size. Since the 10th Five-Year Plan, the cultural industries have been included in these main documents with official targets for development. More recently, the cultural industries have been made into a “pillar industry” in the 12th Five-Year Plan, something that is normally only reserved for industrial industries.

With financial support and protectionist barriers, China’s domestic cultural industries have gotten multiple advantages to grow against foreign competition. For example, non-Chinese companies are prohibited by the MIIT to own or manage telecommunication services in China, which effectively means that the government has direct (legal) influence on all its online operators. Another example, closer to the gaming industry, is the fact that products that hold cultural importance are forbidden to invest in by China’s Foreign Investment Law. By developing their cultural industries, China plans to focus on nation branding for international and domestic purposes.

5_{A lot of literature covers the revitalization of cultural industries in China. However, discussing it all will go beyond}

the scope of this work. Therefore, this thesis will only use the two aforementioned concepts of soft power and nationalism to try to explain the “use” of China’s cultural industries.

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2.2.1. Cultural industries for soft power

Joseph Nye developed the concept of soft power for international relations to, contrary to coercive hard power, persuade countries with tools such as culture, political values and foreign policy (Nye, 1990). Nye believes that soft power is an asset that helps a nation’s international presence and influence in international relations. In addition to realism, which hold tangible concepts of power, soft power concepts provide alternative ways to sway public opinion of a nation. This thesis will, among others, use the concept of soft power to provide an interesting outlook how gaming has become a tool to shape public opinion. However, a critique to this concept is that culture and opinion are intangible and thus rather difficult to measure in order to prove a point. However, this thesis will try to demonstrate how much the Chinese government is attaching value to the global gaming industry, by looking at changed policies and official discourse.

None other than current standing politbureau committee member Wang Huning wrote about the possibilities of soft power as tool for global influence (Wang, 1993). Since then, Wang has been the brain behind several strategies from China’s last three presidents, including Xi Jinping’s Chinese Dream. Due to academic discussion on the concept, soft power managed to be implemented as a national term during the 17th_{national congress in 2007 (used by Hu Jintao) and} has been a key focal point of the government’s political strategies to use culture as nation branding. Perhaps one of the most influential cultural events was the 2008 Beijing Olympics that was choreographed to perfection.

However, some scholars (Shambaugh, 2013; Peng & Keane, 2019) note that too much government control over media and cultural industries tend to work counterproductively for soft power purposes. Not only will control impede on creativity (risk taking, genre-exploring), it will also obstruct international credibility.

China initially failed to present itself as a culturally “cool” and high-tech country such as Japan and South Korea (perhaps due to the fact that the propaganda department views entertainment media as a lesser form of culture, that should rather only serve an educational purpose. However, the country is trying to develop its image as digitalized country by focusing on technological progression and implementing networking systems in infrastructure and facilities via its Internet Plus strategy. Big cities such as Beijing, Shanghai and Hangzhou have all developed ambitious plans to become the number one city to spearhead technological advancement, with gaming as one

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of the most prominent key points. Setting new technological standards are key points for China’s “go-out” strategy to develop its international influence.

The emergence of e-sports most certainly has helped to create opportunities for this with a new kind of tourism that is significantly different from the traditional conveyance of culture (via Confucian schools or the localization of mass media such as Xinhua). According to Szablewicz (2011), Chinese government officials change negative discourse into positive in order to promote E-sports domestically, but Chinese created games have still been lacking in quality for international purpose. Although pushed to “go out” by government policies, the gaming industry has not yet developed to be internationally able to survive heavy competition (with the exception of Tencent). Domestic negative public stigmas and technical underdevelopment usually deter small companies from making their game ready for localization, which greatly hinders a strategy such as nation branding.

2.2.2. Cultural industries for nationalism

There are multiple concepts of the complex theme of nationalism, each with its own point of view and arguably different per country or region. The concept I want to highlight, in short, is the method of nationalism that is encouraged by the Chinese state with the use of digital technology (games). Nationalism, according to Anderson (2006), invokes a sense of belonging, based on a nation as an imagined community. This community consists out of people that have never met each other but share the same feelings for the community that binds them. For the Chinese government, invoking nationalism often comes down to maintaining legitimacy through the use of nation-branding to penetrate the populace and the conjuration of patriotic “us versus other” feelings. Anderson argued that print media fueled these imagined communities, which means that in this era, when the world is a global online community with transnational networks, the Chinese government needs to construct binding common factors for the people.

Jiang & Fung (2017, pp. 15) state that “as popular entertainment, online games can play a potent role in (re)presenting ideological images, building social connections, learning cultural meaning, and forming identity.” The Chinese state has often promoted or financed games that represented Chinese cultural values correctly and sometimes used an adversary to invoke a patriotic tendency among players.

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Examples of such games are games where the adversary is Japan, which Nie (2013, pp. 501) argues were a response to Japan’s own nationalist video games. Games such as Resistance war and Glorious Mission focus on the Sino-Japanese friction, including claiming territory over the Diaoyu/Senkaku islands. The goal of these games is meant to shape a pro-China outlook among players (most notably youth) that recognizes the communist party’s role as protector of the country, that the player is part of. There are also other, less violent games with nationalist characteristics. For example, the Xuexi Qiangguo application that lets players study CCP ideology, included with competitive scoreboard, or the Clap for Xi Jinping game, that Tencent created for people to clap during Xi Jinping’s speeches at the 19th_{National Congress in October 2017 (Linder, 2019).}

The shaping of cultural content and invoking of nationalist feelings can bring about valuable support for legitimacy for the CCP. Nie (pp. 511) argues that “through policy regulations, financial support, and partnership with private game companies, the Party-state has turned the Chinese online game industry into a profitable industry as well as a vehicle of soft power and an instrument for patriotic education.”

Because things such as misinterpretation of historic heroes and incorrect portrayal of territory is punishable by law, companies (foreign or domestic) will want to shape their products to not lose their publishing rights or risk a fine. The content of Chinese games will thus gradually change its players to be positive to the brand that China projects. One such example is the game Devotion, a horror game developed by the Taiwanese Red Candle Games company. After its release, players discovered an Easter-egg that supposedly made a mockery of Xi Jinping. The game then was left with overwhelmingly bad reviews, which resulted in the company taking the game down and its Chinese publishing partner losing their publishing license (McWhertor, 2019).

However, it is important to not overestimate the influence of the law on games. As Nie (pp. 514) correctly mentions, the influence of private investment in the market of the cultural industry has brought challenges to the regulators. Binding the ropes too tight will result in a loss of creativity (thus revenue) and an increase in piracy.

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3. Methodology

3.1. Understanding the role of law and the process of policy making in China

To conduct a research on the regulatory environment in China, it is important to understand that the role of law and the process of policy making in China is different than in the West. This is grossly due to the fact that the current legal system and policy directions of the CCP have been reformed since the opening up campaign in 1978, thus making the system fairly young. Law and legislation in China have, unlike in the West, primary articles that empower the legitimacy of the CCP and favoring it in interpretation. Unlike the democratic and individualistic function of Western systems, the rule of law follows governance according to its constitution, in which the CCP and its ideology is enshrined.

Furthermore, China is led by a party-state mechanism which, at first hand, seems monolithic. However, it is rather complexly organized when it comes to policy making. While the state (government) is responsible for running the country, the Communist Party sets the policy agenda, according to its ideology. The authority figures responsible for policy often also hold positions in the government, which blurs the line between party and state.

Policies in China follow a hierarchical approach, stemming from broad national plans (Five-Year Plans) to local level implementations. The policy making process however is a multi-influential process that is affected by many figures, before ultimately presented to the top. Consensus building (Lieberthal & Oksenberg, 1988) is what affects the final representation of policies. During drafting and revision, ministries, party officials, local government officials, academics and the public can contribute and shape the content of the policy outcome. It then will be presented by the State Council, who will issue relevant ministries and administrations to clarify regulations and administer subsequent policies that claim jurisdiction and responsibilities and determine the shape of the market.

The audiovisual market, in which games are included, is subjected to administrative regulations, which means that the relevant departments can change the regulatory environment when deemed necessary. This is why jurisdictional claims in regulatory turf battles are allowed to happen. Whenever the regulatory situation needs laws, such as the Copyright law and the Patent law, they

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will first have to pass the National People’s Congress (NPC) and drafting and revision often takes several months, if not years.

Law and policy making in China has complexity and more than often a normative function. Language in documents set norms for those who will interpret it and for those who are affected by it. It is therefore important to provide readers with a clear context who and what the affecting and affected actors are and what implications policy provide for the future. That is why this study contains a broad literature review on the media environment and control in China.

3.2. Policy analysis of state documents

The main research aspect of this thesis contains the analysis of primary policy documents from the Chinese government that affect the Chinese gaming industry during the 13th_{Five-Year Plan period.} As mentioned above, the policy making process in China has a hierarchical pyramid-like structure. National plans sink down to varieties and interpretations of these plans at ministerial, administrative, provincial level and so on. I have chosen to follow that path from the top and try to link it to the themes that I discussed in the literature review, in order to draw a conclusion how the Chinese government deals with economic potential versus political stability.

Most of these plans are available on government websites, such as gov.cn and state news agencies, such as Xinhua.6 Some companies and private actors have done large amounts of work by translating these documents into English, which I have used for this work. If no English translation was available, I took up the challenge of translating it myself by searching for relevant keywords such as “online gaming” (网络游戏) or “cultural and creative industries” (文化创意产业).

4. Context of China’s gaming industry

In this section I will bring the Chinese gaming industry into context by giving a short background of gaming in China and introducing the stigma of addiction and the protection of minors, government oversight, the regulators of the industry and the fragmentation of their regulation.

6_{I must notice that a part of policy making in China is also done by special Leading Groups within government}

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4.1. Gaming in China prior to the 13th Five-Year Plan

A generation of Chinese citizens born in the late 80s matured with the introduction and the emergence of the Internet in China, where internet cafés provided a place for social gathering and an escape from studies. The market was flooded by foreign products, full of piracy, mildly regulated and fast rising. Throughout the years, the seemingly ever-growing industry was relatively slowed down by the negative stigma that developed around gaming. As more and more minors were exposed to the digital world, more and more parents raised concerns, influenced by horrifying stories of addiction, accidents and the bad public image of dirty, unregulated cafés. They called the industry “electronic heroin” for their children, which led to investigations from news agencies reporting the troubles of parents (Lu, 2016). Gaming addiction was allegedly portrayed as a new problem and danger to the Chinese society, especially when games implemented with gambling elements gained popularity.

In 2000, the topic of game addiction became a national debate, when reports from the Public Security Bureau confirmed the alleged negative influence gaming had on minors. At that moment, the government decided to step in and for “public morality” strictly limit the import of gaming consoles and tighten the regulations on internet cafés (State Council, 2000). However, corruption on lower levels made these regulations effectively hard to enforce. When the Personal Computer (PC) became more affordable, the Chinese gaming industry saw a surge in the popularity of Massive Multiplayer Online Games (MMOG) that made the internet cafés even more attracting to go to.

In the 2000s, the online gaming industry thrived economically because, unlike traditional media, the industry was not state-owned, but dominated by private enterprises (Cao & Downing, 2008). Politically, the regulatory environment became filled with notices and issuances from the relevant authorities (described below), that, on paper, bound the industry and its users to rules. In addition, the public and political debate on internet addiction reached such heights, that China became the first country to treat gaming addiction as a disorder (Zhu, 2008).

Throughout the years, the government has enacted on the public worries and negative stigma of gaming, by trying to introduce measures such as time restrictions and real-name registrations. However, a developing trend of government policy in the industry can be seen. By introducing a

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regulatory framework, the relevant ministries initially prefer more to act as correcting institutions, rather than enforces of content. Instead, content checking is outsourced to the companies that desire to operate a game in China, which leads to companies self-censoring and implementing their own technical solutions.

By the 2010s, the online gaming industry became one of the biggest gaming industries globally, surpassing the leader, the United states, in 2015 (Newzoo & CGA, 2015). Although fragmented in rule (as described further down below), the online gaming industry was named a key cultural industry with economic potential, supported by both the Ministry of Culture and the State Administration of Press and Publication (Creemers, 2011; 2012). Popular games such as DOTA2 and LOL brought along billions in revenue thanks to their competitive element and protected by investment law, developed large companies rose to giants in status. With the evolution of mobile gaming, the gaming industry developed fast with hundreds of new approvals every year pouring in. However, like before, the industry remained a two-faced sector to the Chinese government: economic potential versus content control. Not only has checking content become more sophisticated (requiring developed equipment and regulations), but has the Chinese government also taken a new path by stating the desire of fixing intellectual copyright laws and creating an industry that produces high quality games.

4.2. Regulation and fragmentation

This subsection will give a brief introduction to the major and minor regulating government bodies of the Chinese online gaming industry. Their name and function will be described below and their abbreviations will be used in the rest of this thesis accordingly.

4.2.1. Overview of the regulators7

I make a distinction between major and minor regulators of the Chinese online gaming industry. I describe major regulators as government bodies that are commissioned to oversee the industry,

7_{This thesis will address the relevant authorities by their names at the time of events, therefore bear in mind the}

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actively create policies and enforce regulations. Minor regulators are relevant to the market and its policy making but are not empowered to intervene directly.

Major regulators

Ministry of Culture (MOC) 文化部  (2018) Ministry of Culture and Tourism (MCT) 文化

和旅游部;

The MOC was responsible for administering cultural products, applying cultural policy and to make guidelines in the field of culture. Since the 2018 government overhaul, the ministry merged with the tourism administration to form the MCT, thus taking on their responsibilities as well. Its relation to the game industry has changed throughout the years, but the body has been mainly responsible for issuing cultural licenses to game developers, checking content, approving games and making guidelines for the game-approval process. Both the MOC and MCT report(ed) to the State Council.

General Administration of Press and Publication (GAPP) 国家新闻出版署  (2013) State

Administration of Press and Publication (SAPPRFT) 国家新闻出版广播电影电视总局 

(2018) State Administration of Press and Publication (SAPP) 国家新闻出版署;

The GAPP has changed two times throughout the Xi administration. The department was responsible for regulation and distribution of all publishable material, either on- or offline. The administration has the authority to screen, censor and ban every printed or electronic information source in China. At the same time, the publishing department also doubles as national copyright administration of China (NCAC). In March 2013, the government decided to add the responsibilities of the film and radio department to the GAPP, thus creating the SAPPRFT. The merger meant greater efficiency of media control and a more streamlined government body. A second reform broke off the film, radio and television responsibilities again. The SAPPRFT was abolished and divided into three different administrations. The press and publication part, SAPP, was reinstated as a single entity again, seemingly undoing the centralizing effort from five years before. The 2018 government overhaul means more party influence in the gaming industry, now that the SAPP directly reports to the publicity department of the CCP, instead of the State Council. The responsibilities of the SAPP in the gaming industry include (pre-)approval, licensing, checking and overseeing content and distribution.

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Cyberspace Administration of China (CAC) 国家互联网信息办公室;

The CAC is a relatively recent established government body, stemming from the earlier State Internet Information Office (SIIO). Since 2014, the CAC operated under direct supervision of the Office of the Central Leading Group for Cyberspace Affairs (after the 2018 reform dubbed Central Cyberspace Affairs Commission), led by Xi Jinping himself. The office is responsible for the supervision and management of the nationwide information content in order to bring the cyberspace under the rule of law. Although the CAC is not directly responsible for the gaming industry, its general internet laws and regulations are often included in the regulations of relevant authorities in the industry and affect the interpretation process. Furthermore, it has the power to urge relevant ministries and departments to adapt their governance.

Minor Regulators

Ministry of Industry and Information Technology (MIIT) 工业和信息化部;

The MIIT oversees China’s internet, telecommunications electronic hardware and software, promotes technological equipment and innovation and regulates the construction of the information system. In context of the gaming industry, every company needs an ICP commercial license to operate on a public Chinese network if dealing with online payments.

Ministry of Education (MOE) 教育部;

The MOE is active in the participation of lawmaking when minors are related. As gaming was (and still is) considered to be grossly affecting studies from minors, the MOE has been assigned to co-operate in shaping the future gaming environment for China’s youth.

Other relevant government bodies

State Council (国务院)

Publicity Department of the Communist Party of China (CPCPD) (中共中央宣传部)

Ministry of Public Security (MPS) (公安部)8

8_{The MPS oversees the implementation and good use of systems such as real-name registration and operates}

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4.2.2. Pre-approval and licensing

A game needs pre-approval from the regulating bodies before it can be published. The MOC and SAPP both have a separate approval process, split up into even more approval processes, depending on what platform the game is distributed and if it is of foreign or domestic craft. The time window of approval also differs significantly. The game approval process is a complex matter. In short, the publishers of games are subjected to rules that prohibits them from making content that:

1. violating the basic principles determined in the Constitution;

2. compromising the unity, sovereignty or territorial integrity of the state;

3. divulging a national secret, jeopardizing the national security or damaging the honor and interests of the state;

4. instigating hatred or discrimination among ethnic groups, undermining the solidarity among ethnic groups, or disrespecting ethnic customs and practices;

5. advocating cult or superstition;

6. spreading rumors to disrupt the public order and social stability;

7. advocating obscenity, pornography, gambling or violence, or abetting the commission of a crime;

8. insulting or defaming others and injuring the legitimate rights and interests of others;

9. breaching social morality; or

10. otherwise prohibited by any law, administrative regulation or provision of the state. (MOC, 2010, Article 9)

Guidelines such as these are subjective to the examiner of the game. However, notices and regulations heavily support developers and publishers to self-examine before applying (MOC, 2013). Foreign games need to be examined by national level censors, while domestic games “enjoy” the privilege of local government examiners.

Prior to 2018, In addition to pre-approval, the publisher also needed to obtain three licenses from respectively MIIT, MOC and SAPP. One to operate on the network, the other for the creation of a cultural product and the last one for publishing digital works. These licenses ensure correct content

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from the operator that requests them, as they are bound by aforementioned regulations and therefore not easily given. In fact, a company cannot request a SAPPRFT license without first obtaining the MIIT license and foreign invested companies cannot request a license at all, due to China’s foreign investment law that prohibits them from investing in sectors that relate to internet culture and digital publishing. After receiving a license, the game receives a publishing number (ISBN) and can be prepared for publication.

4.2.3. Fragmentation and turf battles

China’s online gaming industry has known two major regulators now for a long time. The MCT and the SAPP control the approval, licensing, content and distribution of all domestic and foreign incoming games. But a shared jurisdiction can lead to friction. A fragmented work field often leads to departmental turf wars with each department ambitiously competing for maintaining its own “ground”. In a hierarchical political system, there is need for efficient communication and cooperation, but often are officials motivated by self-interest (Downs, 1967). In China’s case, a fragmented political system occurred since Deng Xiaoping’s reforms in the 80’s (Lieberhal & Oksenberg, 1988). Since then, the political environment in some cases has known policymaking in the form of reaching a consensus between relevant responsible authorities.

Although China is not alone in this occurrence, it is known for its competitive political structure, rewarding officials and departments in a merit-based system. Policy entrepreneurs try to influence the policymaking process, crowding the field even more (Mertha, 2009). In addition, there is also a level of uncertainty whether one’s office or department will continue to exist. A constant reforming of the political environment has led to departments vying for not only power and financial gain, but also survival. Mergers are capable of cutting the responsibilities of a body to such degree, that laws and regulations are formed to claim jurisdiction, in order for a department or office to be sure of survival. This in turn usually increases the administrative processes, thus slowing down potential growth and revenue.

This kind of fragmentation has also happened in China’s gaming industry. As mentioned before, the industry is regulated by two bodies, the MOC and SAPP. Before 2008, both regulators were in charge of handing out permits separately to operating companies. On paper, the two bodies did not have a clear distinction where their jurisdiction began and where it ended, thus interpreting their own boundaries. In July 2008, the General Office of the State Council issued two separate

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documents to the MOC and GAPP, mentioning their responsibilities. However, again, their boundaries were not clearly defined, due to the unclear territory that cyberspace brings with it.

Their territorial dispute thus continued and led to arguably one of the most famous examples of turf wars in China’s gaming regulation environment.

In 2009, the American company Activision Blizzard switched Chinese operators for its game World of Warcraft, which required a new process of licensing. The new operator, Netease, applied for both licenses of the MOC and GAPP. A few days after the application, the MOC issued a notice that strengthened its rule over the regulation process (MOC, 2009). In July, the GAPP retaliated with a declaration mentioning its responsibilities (GAPP, 2009).While the MOC issued a license, the GAPP held on to one, possibly due to that fact that the previous operator had sued the American company (Pilarowski, 2009). With only one license approval, Netease was legally not allowed to operate, much to the disliking of the MOC.

In September, an office responsible for the organization of and management of government offices, the State Commission Office for Public Sector Reform (SCOPSR), released a document further clarifying that the GAPP is responsible for the pre-approval process, but after release all power lies with the MOC (SCOPSR, 2009). Netease considered the approval of only one license enough, since according to these notices, it had correctly undergone the pre-approval process before its launch in 2005. With the license of the MOC and heavy monetary losses due to the freeze, it gambled on launching the game again mid-September. A few days later the GAPP reacted with another notice, stating that companies switching operators need to apply for a GAPP license again and is forbidden from operating in China if lacking the license (GAPP, 2009a). On November 2nd_{, the GAPP} prohibited Netease from operating, thus stalling the game again. Only in February 2010 did the operator and GAPP reach an agreement and was the game launched again.

This example shows the territorial quarreling between the MOC and GAPP as main regulator of the industry at the cost of private companies. Seemingly unclear laws (though the state council’s notice explicitly stated the MOC as main regulator) causes both government bodies to aggressively defend their terrain at the cost of administrative oversight, economic income and of course the people playing games themselves. This lack of clarity has been a frustrating factor in the approval process of new games and went unresolved for several years. Fragmentation counts as a main

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reason for the Chinese government to reform the political environment in order to streamline processes.

5. The 13

th

Five-Year Plan period and changes to the gaming industry

With Xi Jinping taking office, the CCP promised a more streamlined structure of the government by planning to reform and merge offices. This new goal of centralization was fueled by Xi’s desire for more implementation on party ideology in society and within the government. Battling corruption and cleaning up improper officials were deemed vital to reach a “harmonious society based on socialism with Chinese characteristics”. The centralization meant that it would be easier for the party to oversee the actions taken by the state now that some offices reported directly to officials high-up in the system.

Another key point in Xi’s plans was more control on the internet. Besides trying to bring the cyberspace under the rule of law, the CCP also planned to control the content and spread of everything on the internet, with a central role for the CAC and the publicity department.

Key documents to realize these goals are drafted in national policy via the so called “Five-Year Plans” that project the country’s main targets for the subsequent 5 years that follow. The 13th Five-Year Plan was Xi Jinping’s first plan since his presidency and contains notable shifts in party focus, mainly the informatization of the country and its industries. This chapter includes the main body of the research, and it envelops the starting point of changing regulations in the gaming industry. I have looked at the key documents that surround the 13th Five-Year Plan in a hierarchical order. Then, I have tried to link the plans to the changes that have happened to the regulatory environment of the gaming industry and, connected to the themes in the literature review, have drawn conclusions why these changes were made and what implications they (could) have.

5.1. China’s 13th Five-Year Plan for economic and social development

As all Five-Year Plans, the 13th Five-Year Plan focuses on the economic directions that the country will follow for the upcoming five years (State Council, 2016). It was passed in March 2016 during the 4th session of the 12th NPC. Most present in the plan is the implementation of ICT to ensure a

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transformation to a digital economy for the future, made possible through of Xi-Li policy initiatives, such as Made in China 2025 and Internet Plus.

The plan also includes sections that contain the promotion of culture and cultural products. Chapter 3 of the plan contains the major objectives, from which one is to improve the overall caliber of the population and the level of civility in society. The subsection explains the government aims to do this by advocating patriotism, collectivism and socialism with the Chinese Dream and socialist core values. It also aims to improve the standards of citizens, transform the cultural sector into a pillar of the economy and expand the influence of Chinese culture.

Further down the document is chapter 68 that advocates the desire to provide more cultural products and services, from which section 3 talks about the acceleration of development of modern cultural industries and section 5 about the enrichment of cyber culture and clean-up of the online environment. Section 6 subsequently promises reform of the cultural sector, that among others, states to “combat pornography and illegal publications, strengthen market oversight, and become better able to carry out coordinated law enforcement.”

Then, chapter 69 states the desire of the Chinese cultural sector to open up for international audience and to “develop a system of discourse based on Chinese cultural characteristics that fits with both international practice as well as the unique characteristics of individual countries”

While the use of language seems rather characteristic, the tone is clear. Culture is becoming an increasingly important part of the transforming Chinese economy, while at the same time it should adhere to CCP ideology and the healthy standards for its citizens. Furthermore, the plan has included digital creative industries as one of the strategic emerging industries.

5.2. State Council’s 13th Five-Year Plan for strategic emerging industries

Following up on the 13th Five-Year Plan, the State Council released in December 2016 its plan for the strategic emerging industries (State Council, 2016a). The part that covers the digital creative industries seems aspirational at first, because it does not fit with the industrial tone of the other industries but shows the increasing integration of technology and culture into strategic national plans.

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The plan states that the output value of digital creative industries by 2020 should reach 8 trillion yuan. It aspires to strengthen supply chains and equipment with high-tech, but it also demands that standards will be set for both technology and content (chapter 6, point 1). Furthermore, it appeals for the creation of high quality and original products (literally including games) to form a digital creative brand for China’s “going out” (chapter 6, point 2). Lastly, it mentions a point for online games to adjust laws and regulations to combat piracy and infringement, protect physical and mental health and to simplify the approval process, but strengthen supervision.

The plan tasks both the MOC and SAPPRFT with innovating creative plans for equipment, enriching content of digital culture and decentralization of government. However, only the SAPPRFT is tasked with reforming and strengthening relevant laws and regulations.

5.3. MOC and SAPPRFT’s 13th_{Five-Year Plans}

In April 2017, the MOC released its ““13th Five-Year” Cultural Industry Development Plan” that articulates the use of culture to enhance China’s soft power (MOC, 2017). In this plan, the ministry promised constant purifying and standardizing of the network and to focus on branding. The gaming industry received a whole subsection on its own. The ministry expects the game industry to “foster a group of key game enterprises with strong brand influence and international competitiveness, and create and produce a batch of healthy and up-to-date games with national characteristics” (chapter 3, section 4) Furthermore, it encourages use of high-tech equipment paired with independent intellectual property rights and promotes new formats of events such as e-sports.

In addition, it also states an aspiring linkage to the Belt and Road Initiative to form an “International Cooperation Action Plan” for the animation and game industry, that promotes expansion and cooperation with countries along the route (chapter 9, box 8).

The plan of SAPPRFT grossly matches MOC’s 13th_{Five-Year Plan in terms of fixation on} development, but it focuses more on its own working field (SAPPRFT, 2017). It is also not as specific about gaming but does point out the importance of the use of culture and the cultural industries. It mostly involves projects for the people, such as the “National Reading Plan”, of which

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some are focused on the integration of new technology. It also vows updating laws and regulations, with a focus on copyright and IP protection.

The plan only mentions gaming three times: The motivation to create original content for China’s “going out” strategy (box 2, point 4), the construction of cultural theme towns/parks (box 7, point 4) and, just like MOC’s plan, the inclusion of the Belt and Road Initiative for “win-win” co-operations for localization and the establishment of key-brands (box 10, Point 3).

The summarization of these plans points out that the Chinese government top and subsequent ministries and administrations view culture as a strategic part for development. It can boost economic potential, but it needs to create high quality products and at the same time adhere to harmonious ideology.

The plans from both regulators lean on the Cultural Reform and Development plans from the State Council that promote CCP socialist ideology into the national discourse (State Council, 2017). The 13th Five-Year version states that “the Internet has extensive and profound influence, and there is an urgent need to expand new areas of cultural development, develop and strengthen mainstream online opinion positions, and better use advanced technology to develop and spread advanced culture” (foreword) In addition, cultural industries’ work need to be of high quality to enhance “National cultural soft power” (chapter 1, section 1). Furthermore, it urges relevant ministries to work on the guidance of public opinion (chapter 3). An anonymous source related to a Chinese game company that I spoke, confirmed that the development of the gaming industry is beneficial for the public opinion on games. She told me that the public witnesses the success of tech companies and become more open-minded about the role of the gaming industry, especially since gaming has a connecting role.

5.4. CAC, MOC and SAPP changes to the regulatory environment

5.4.1. Inclusion of mobile games in regulations

The starting year of the 13th Five-Year Plan included a lot of new regulations from the authorities of the gaming industry. Mobile games have been the top grossing category in the gaming industry in revenue but had little to no legal requirement to enter the market. The SAPPRFT issued a notice

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that required mobile games to require a license and go through its special approval process (SAPPRFT, 2016). Prior to this notice, the mobile game industry had risen exponentially, but was flooded with cheap copycat games (also called zombie games) that the new cultural plan desired to get rid of. Only a fraction of the existing mobile games apparently sufficed to the regulations. Since that year, the game approval ratio had been larger than ever. Mobile games that were “simple” in form were excused from the complex approval process.

Following in the footsteps of the notice, the China Audiovisual and Digital Publishing Association (CADPA), that is closely linked to SAPPRFT and run by its former deputy director Sun Shoushan, published specific directions to mobile game developers what content would not be allowed in-game (CADPA, 2016). Former general regulations had not been as specific before and gave insightful information how examiners had interpreted game approvals before. Just like other platforms, the 2007 anti-fatigue system was also included as a requirement for mobile games. By order of the CAC in the 2016 notice Mobile Internet Application Information Service Management Regulations, mobile apps needed to include real-name registration functions in order for the anti-fatigue systems to be effective (Creemers, 2016a).

Through a loophole, it appeared that the Apple store still contained unlicensed apps. In 2019, Apple issued warnings to developers to either get a license number, or their game would be removed. Starting from 1 July 2020, it began removing apps and in just a few days over 8.000 apps were already removed from the store (Baker, 2020).

5.4.2. Preventing gaming from becoming gambling

Because gambling is prohibited by Chinese laws, regulations needed to be updated to prohibit the enabling of gambling within network services, including games. Initially, this was harsh for Chinese game developers, as the so-called “Chinese business model” in games revolves around Freemium games that are free to play but have in-game purchases and work with micro transactions. These games often contain collectors’ items, or items that boosts your game progression. However, these items are only available via “lootboxes” that contain a random item generator and need to be purchased. Gambling in-game was already forbidden by a 2007 notice and the 2010 interim regulations, but they did not apply specifically to lootboxes yet.

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In 2017, the MOC decided the lootbox system resembled slot machines too much and should therefore disclose the odds of receiving an item at random. In addition, the boxes are limited in purchase and cannot be purchased with virtual money (MOC, 2016). The new rules of the SAPP in 2019 required games to specifically tell how many boxes needed to be opened for a certain item (Ye, 2019a).

5.4.3. Protecting and raising minors

Teaching society socialist harmonious values is one of the core objectives of the cultural industries, according to the new plans. Teaching people in their youth can set their norms and beliefs for the future. Youth arguably accounts for the highest number in percentage of the Chinese gaming community and are therefore a valuable factor to stimulate patriotic feelings.

Unfortunately, Chinese youth have throughout the years shown to be susceptible to long periods of gaming, arguably to relieve pressure from studies, but at the cost of (deadly) incidents and desperate parents. According to the 2019 CNNIC report of online activities for minors, of all 175 million minors in China, the internet penetration rate counted for 93.9%. From that number, 61% used the internet for playing games (CNNIC, 2019).

For decades, gaming had been a public dilemma of economic revenue versus health. As of 2018, Xi Jinping himself in a speech pointed out a growing problem of myopia among children, which caused the MOE in collaboration with the SAPP to tighten the rules. In the notice, the MOE asked the administration to regulate the amount of new games approved, implement age systems and invent ways to limit minors from game (time) (MOE, 2018). Tencent already took matters into its own hands after receiving commentary from parents and teachers in 2017. It limited playtime for its most popular game “Honor of Kings” (Jiang, 2017). In addition to that, it also started implementing facial recognition to play the game in 2018 (Webb, 2018).

The MOE notice eventually prompted SAPP to introduce new gaming regulations to protect minors. A notice from the SAPP in early November 2019 stated six points to limit game time and spending of minors (Daum, 2019). It urged companies to implement real-name registration within 2 months, not provide game services to minors between 22.00 PM and 08.00 AM, only allow 3 hours of game time per day during vacations and 1.5 hours during normal days. In addition, minors can only spend a certain amount of money, depending on their age. The notice makes clear that businesses will not receive a license if they do not comply with the rules. Besides these specific points, the notice also

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asks companies to test age-systems and vows to train parents and the community to guide child behavior.

To top off the protective measures: As of writing, the Minor Protection Law is being revised with a special updated section on cyberspace affairs (Sheng, 2019).

5.5. Shifting responsibilities and CCP entrenchment: The 2018 government overhaul and changes in requirements for online game content

At the third plenary session of the 19th CPC Central Committee on February 2018, the CPC decided and agreed on a government department reform. Mid-March, the State council released the notice of Deepening Reform of Party and State Institutions, that shuffled, abolished and created government branches (Xinhua, 2018).Among others, it stated that the SAPPRFT was to be split up in three sections. The press and publication part became directly under the influence of the CCP’s publicity department, a sign of Xi Jinping’s greater strategy of more party influence in state territory. David Bandurski correctly mentions that the publicity department has no legal obligation to report to the State Council, has no website and does not have to answer to citizen questioning decisions, thus limiting transparency (Bandurski, 2018).

The newly formed SAPP was immediately instructed to adjust the approval environment of the gaming industry. Gaming had long since been a subject of discussion and received much criticism at 2018’s “Two Sessions”. Members called it drugs that metaphorically “should be beaten with a stick”9_{. Besides addiction, congressmen also feared games entering from the outside with} anti-China characteristics (Future Network, 2018).

After the criticism, on March 28, the SAPP stopped game approval requests to revise its approval system. The newly formed MCT followed suit in August. What lasted was a nine-month freeze of approvals, full of insecurity how the regulatory environment would develop and included with a switch of personnel in August. SAPP director Zhuang Rongwen was appointed director of the CAC, as the latter body earlier had been lax in “safeguarding political security” (Gan, 2017).

Playing by the rules: Analyzing policy making and regulations surrounding China’s online gaming industry during the 13th Five-Year Plan period (2016-2020)