China’s huge crackdown on tech, explained

Chinese regulators are rolling out restrictive rules on algorithms. Separately, under-18s will only be allowed to play 3 hours of games a week.

From Apple to Facebook to Google, Big Tech firms in the US are facing various antitrust lawsuits.

But at present, these legal battles look like mosquito bites compared to what’s happening in China: Since February, Chinese tech companies have lost over $1T (that’s trillion) in market value in the wake of regulatory action.

The draft of new regulations…

… came out last week that will put restrictions on how China’s tech firms can use their algorithms.

Per TechCrunch, the changes will affect a wide range of categories, including:

  • Short videos
  • News aggregation
  • Ride-hailing
  • Food delivery
  • E-commerce

The proposal is stricter than the EU’s data rules

Under these laws, algorithms would have to:

  • Align with the state: Recommendations “should uphold mainstream values” and “not endanger national security.”
  • Be more transparent: Tech firms must create a system for the review of “algorithmic mechanisms.”
  • Be good for users: By not feeding them “addictive” content.
  • Be available to authorities: In case of a police investigation.

These guidelines are just the start.

China also just announced restrictions for online gaming

As of Sept. 1, kids under 18 will only be allowed to play 1 hour per day  from 8pm-9pm on Fridays, weekends, and holidays. The government is acting out of concern that overgaming causes health issues.

Gaming giants like $560B+ Tencent will enforce this rule with facial recognition and “real name verification systems,” per The Guardian.

While the broader algorithm draft regulation has yet to pass, we have a feeling the 1-party state will find a way to make it official.

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