As China’s General Administration of Press and Publication (GAPP) and the Ministry of Culture continue to flex their muscles over control of the country’s game industry, World of Warcraft gamers and operators are feeling the brunt of the infighting between the two entities.

Reuters reports that GAPP has stripped NetEase of the ability to operate The Burning Crusade, the latest version of WOW. GAPP cited a “gross violation” of regulations and ordered NetEase to stop charging users to play the game and to cease taking new subscriptions.

NetEase has since responded, saying that they “believe that they are in full compliance with applicable PRC laws and are currently seeking clarification from the relevant governmental authorities.”

Roth Capital Partners analyst Adam Krejcik said of NetEase, “These guys are essentially stuck in the middle of this power struggle.”

Until September of this year, GAPP was responsible for approving all game content within China. The Ministry of Culture assumed some of these duties, but GAPP appears unwilling to give up its authority, leading to the current infighting. WOW was launched in China on September 19 with Ministry of Culture approval, but no GAPP approval, which is now coming back to haunt NetEase.

Analysts estimate that Chinese WOW activity contributes 5 or 6 cents a year per share to Activision’s earnings.


Thanks Greenfenri

As of a month ago, a Chinese MMO company has started banning accounts of male players that play female characters in their game. Only a few news sites outside of China have picked up on the ruling.

Aurora Technology, a subsidiary of MMO giant Shanda that publishes many MMOs in China, including AION, Dungeons & Dragons Online, and Company of Heroes Online, started requiring players of their MMO King of the World, to start proving their gender via webcam. The rule, which was first announced in late September, seems to apply only to male players playing female characters and not the reverse.

There was no further explanation of the ruling, although the headline on the Pacific Epoch site says it is an attempt to rein in transsexuals in games.

In a more recent take on men playing women in video games, the author makes some broad generalizations, including that men like watching their lithe female avatars from behind, or that "a man would want to play a female character is often evidence enough for many in the online community to label someone a homosexual."

Do you male readers play women in your MMOs? If so, why? Should companies regulate how you play their game as long as your play does not infringe on other players? Maybe that was the reason for the ruling, the chance of deception, although it obviously isn't made clear. Either way, the ruling seems a stretch, in this writers opinion, and one that seems destined to fall by the wayside, if it hasn't already. 

China’s ongoing bid to monitor online gaming content and limit foreign involvement in online games within the country has spread to two arms of the Chinese government.

While previous reports, in light of the recent reassignment of duties, seemed to leave some unanswered questions about the exact role of each government entity in relation to online games, a Forbes article attempts to clear up some of the mystery.

China’s General Administration of Press and Publication (GAPP) is apparently responsible for clearing online content and games if a CD-key is involved, while the Ministry of Culture is now in charge of all other game content approval, including imported games reports Forbes.

GAPP was previously responsible for clearing all game content until September, when some duties were taken away and bestowed upon the Ministry of Culture. GAPP appears to be unwilling to give up some of its tasks, which has already led to infighting between the two government branches.

Chinese World of Warcaft Operator NetEase appears to be taking the brunt of the bickering, which has in turn affected its stock price. The company is caught squarely in the middle as it launched WOW in China on September 19 with Ministry of Culture approval, but no GAPP approval. An analyst told Forbes, “We believe this battle between the two government departments will continue to put pressure on NetEase’s shares.”

The analyst doesn’t think WOW will be shut down, but believes that approval for the Wrath of the Lich King expansion will be “further delayed.”

A new report that details online game revenues in China showed a second quarter tally of 6.18 billion yuan (approximately $906 million U.S.), a 39.5 percent increase over the previous year.

Reuters reports that Tencent Holdings led the way in the quarter with a 20.2 percent share of the pie, or 1.24 billion yuan (approximately $182.0 million U.S.), by virtue of its free online game offerings. NetEase.com, which operates World of Warcraft in China in league with Activision Blizzard, took third place in the quarter, with 12.7 percent of the market and 780 million yuan (approximately $115.0 million U.S.). Research firm Analysys International provided the data.

Of late China has tightened its controls of online games, recently cracking down on online titles with illegal content and attempting to ban foreign firms from any involvement in online games.

Full year revenue from online games in China is expected to be between 24.0 to 27.0 billion yuan (approximately $3.5 billion to $4.0 billion U.S.), growth of 30.0 to 50.0 percent over the previous year.

Two arms of the Chinese government appear to be battling over whether or not non-Chinese companies can operate online games within the country’s borders.

The General Administration of Press and Publication (GAPP) issued a statement on Friday saying that “foreign companies are not allowed to operate online games in China in any form.” The only problem? Control of China’s online gaming industry was taken away from GAPP last month and given to the Ministry of Culture. Proactive Investors reports that Tuo Zu Hai, a Vice Director in the Ministry of Culture was “startled to hear the news” emanating from GAPP.

Reuters states that the ban covers all foreign investment in online games, including joint ventures, agreements and technology support, which may not be good news for NetEase.com, the new operator of World of Warcraft in China.

While GAPP’s position is not entirely new, the story notes that strict enforcement of the ideology was not previously common place.

The statement from GAPP was released just in advance of the kick off of the Game Developers Conference in Shanghai, which opened today.

Chinese officials have launched a new initiative designed to rid the country’s Internet of illegal games featuring content deemed inappropriate (by the government) for its citizens.

Yahoo reports that 45 online games have been shut down so far, some of which had players partake in games with illegal activity such as selling drugs or peddling hookers. 200 games in all were investigated according to the report, with some given time to eliminate or change any illegal aspects.

The campaign was launched in conjunction with the 60th anniversary of the founding of communist China on October 1.

Earlier this year the Chinese government targeted games featuring organized crime.

Fighting an attempt to open media distribution within its borders, China is appealing a World Trade Organization ruling against it, citing a necessity to protect its “public morals.”
 
The defense comes in reaction to a WTO ruling that China must cease routing U.S.-based artists and production companies through state-controlled distributors. The Wall Street Journal notes that, if implemented, such a ruling would “be a boon to Western makers of movies, music and video games who currently face extra costs and obstructions to distribute in China.”

The article notes that the “public moral” defense has been used only once before, by the U.S. in 2005, as part of an unsuccessful attempt to defend a ban on Internet gambling. Any country using the defense must prove that trade restrictions are essential to protecting its morals.

Everyone complains about lousy remakes of favorite games, but activist Chinese gamers did something about it - at least for a little while.

zonaeuropa reports that the online relaunch of Hot Blooded Legend was stopped cold by a mob of avatars that blocked new players from passing through the gates of the game's virtual city. The avatars were controlled by Chinese gamers who were upset that the new game didn't do justice to their beloved original:

Several days ago, Shanda published some screen captures which the players sadly found to include class restrictions and commercial stores... if a player has cash, he can purchase equipment to upgrade without having to go through the trouble to combat monsters ...

The players decided to call for a boycott...  At 2pm, the game opened as scheduled...  At one entrance, more than 40 characters stood still.  They wore cloth dresses and cloth shoes and stood shoulder to shoulder. Other players cannot enter... Meanwhile, several thousand people were blocking the gates of the various cities in the game.

The "counter-attack" [by game admins] came soon... Some players found their screen went black suddenly... Other players were transported by the system administrator far into the wilderness...

While the blockade eventually ran out of steam, the protesters made their point.

Via: boingboing

The popular, World War II-themed RTS Company of Heroes is shortly to enter the Chinese game market as Company of Heroes Online, reports Kotaku.

When it does, all references to Nazi Germany will have been purged. The German side will be renamed "The Federation," while iron cross symbols on German vehicles and buildings will also be changed.

Video game publishers could gain direct access to the massive Chinese market following a ruling by the World Trade Organization that China may not invoke culture-based censorship to block foreign media imports such as books, games and movies.

According to Reuters, the WTO ruling came in response to an April, 2007 complaint filed by the United States:

The WTO ruling could potentially affect how foreign video game companies operate in China.

U.S. video game titans such as Electronic Arts, Activision Blizzard and Take Two Interactive, are not allowed to operate games directly in China, or through joint ventures with local firms. They instead license games to local operators or co-develop games with local firms.

But the WTO ruling was unlikely to overcome China's determination to govern the virtual landscape, said Dick Wei, vice president of equity research with JP Morgan in Hong Kong.

If you own the Psyclone Essentials or React Wii 4-Dock Battery Recharge Stations, it's best to unplug them.

The U.S. Consumer Product Safety Commission has issued a product recall on both units, citing fire and burn hazards caused by potential overheating of the battery pack. A half-dozen incidents have occurred so far, with two gamers suffering minor burns to their hands.

The $50 units were made in China and distributed in the United States by Griffin International. They were sold at Target, Toys R Us, Amazon.com and Best Buy.

The CPSC website explains the process for returning the defective Wii chargers.

UPDATE: Joystiq's Alexander Sliwinski reminds us that these products have been experiencing overheating problems since 2007...

Last week GamePolitics reported on the tragic death of 16-year-old Deng Senshan (left). The Chinese teen was beaten to death by employees at a camp for Internet addicts.

IDG is now reporting that 13 people have been rounded up by Chinese investigators. The facility itself, the Qihang Salvation Training Camp, has been shut down after authorities found that it was unlicensed. 122 students receiving "treatment" there were sent home to their families. From the IDG report:

Conservative [Chinese] officials blame hugely popular online games like World of Warcraft for getting teens hooked on the Web, harming their grades in school and dividing them from their parents. Some of the camps have used shock treatment on students, but China banned the practice last month.

UPDATE: More at Slashdot...

It's unclear from reports whether or not Deng Senshan (left) was a gamer. It seems likely, however, given his age and the fact that many of those confined to Chinese Internet addiction camps are there for alleged obsessive play of online games.

Tragically, the Global Times reports that the 16-year-old was beaten to death by three camp teachers on Sunday for failing to run fast enough. His bereaved father, Deng Fei, spoke of his son's death:

My son was very healthy and was not a criminal. He just had an Internet addiction when I left him at the camp. The police informed us that our child had died on Monday morning. We can’t believe our only son was beaten to death.

The teachers promised me that they would not use any physical punishment on my son when I dropped him off... We’re planning to sit before the local government for a protest tomorrow. If they don’t give us justice, we will go to the camp to confront them.

Deng Fei paid 7,000 yuan - US$1,024 - for his son to spend one month at the camp.

Meanwhile, the Wall Street Journal reports that Chinese netizens are outraged by Deng Senshan's murder:

Many [Netizens] questioned the fairly new diagnosis of “Internet addiction” as a mental disorder.

“Internet addiction? It’s a term made up by some so-called ‘experts’, how come these parents believe what they’ve said?” said one commente... “[It] should be the parents’ problem. Why do they always exaggerate their kids’ hobbies, turning them into addictions or problems?” said another...

One netizen called for greater tolerance of Web habits: “I am sure only China has such a term: Internet addiction…. Why can’t its people accept new ideas and new things with an open mind?”

GamePolitics readers may recall that China recently outlawed electric shock therapy as a means of treating teenage video game addicts.

Via: Gizmodo

The government of China has implemented a crackdown against online games which feature organized crime themes, reports the New York Times: 

On Monday, the Ministry of Culture issued a notice banning online games that feature Mafioso kingpins, marauding street gangs or any sort of hooliganism predisposed to organization.

The decree, which promises “severe punishment” for violators but fails to specify the penalties, also prohibits Web sites from including links to Internet games that glorify organized crime.

Such games, the ministry said, “embody antisocial behavior like killing, beating, looting and raping,” and their availability “gravely threatens and distorts the social order and moral standards, easily putting young people under harmful influence.”

 As GamePolitics has reported, video games are a frequent target of Chinese government scrutiny.

If the Red Ring of Death didn't kill your Xbox 360, maybe Chinese drywall did the dirty deed.

Business Report advises that a dozen class-action suits in 33 states have been filed against builders and suppliers who used drywall imported from China in recent construction. Much of the drywall suspected of contamination was installed during 2006 and 2007. Louisiana was particulary hard hit due to heavy post-Katrina reconstruction underway in that time period.

So, what are the symptoms and why is this posted on GamePolitics? Because your video game system or gaming PC might be affected by contaminated drywall, which among other nastiness, corrodes wiring. Here's what the Consumer Product Safety Commission recommends to watch out for:

• persistent rotten egg odor
• respiratory or other symptoms alleviated by leaving a building and worsened on return
• blackened and corroded metal, including copper, nickel, silver and/or stainless steel
• premature failures of central air-conditioning evaporator coils
• blinking lights or power failures
• arcing or sparking
• intermittent operation or failure of appliances such as refrigerators and dishwashers and electronic devices such as televisions, computers and video-game systems

If you suspect you have a problem with contaminated drywall, check the CPSC website for advice on how to proceed.

The Chinese government has ordered a controversial video game addiction clinic to stop subjecting alleged teenage game addicts to electric shock treatments.

China Daily reports that the Ministry of Health issued the directive yesterday to the clinic in Linyi, Shandong province:

More than 3,000 young people were tricked or forced into in to the four-month long course. To enroll their children, parents or guardians had to sign a contract acknowledging that they would be given electric shocks of up to 200 milliamperes. The treatment cost 6,000 yuan ($878) per month...

 

Shocks were given if patients broke any of the center’s 86 rules, which included prohibitions on eating chocolate, locking the bathroom door, taking pills before a meal, and sitting in Dr. Yang's chair without permission.

Details of the treatment first became public when former patients wrote about their experiences online...

Kong Lingzhong, who edits a Chinese Internet addiction-themed portal commented on the clinic's methods:

We have no clue whether this freaky treatment has side-effects.

Earlier this week GamePolitics covered a story by Information Week which reported that new Chinese regulations on virtual currency would outlaw gold farming.

But there appears to be confusion about whether the practice of gathering in-game MMO currency and then re-selling it for real cash will be affected by the new regulations.

incgamers disputes the report, citing the University of Manchester's Prof. Richard Heeks:

This [new Chinese law] therefore is not about what gold farming clients do: use real money to buy these virtual currencies; it’s the mirror image.  And it’s not about the major trade in gold farming such as World of Warcraft, which relates to other types of virtual currency.  And it’s not about buying/selling in-game items.  And it’s not about the power-levelling of avatars. Bottom line: it’s not about gold farming.

In any case, Dean Takahashi of Venture Beat writes, a ban on gold farming may be difficult for Chinese authorities to enforce:

The practice of trading virtual goods for real money is easy to make illegal, but hard to enforce. The gold farmers may not be affected... because of a technicality. Most of China’s gold farmers, who operate in sweatshops with dozens of fellow farmers, operate on servers on foreign soil. The government can only control what goes on with domestic servers...

The New York Times, which did not challenge the notion that the rules would impact gold farming, quoted Indiana University Prof. Edward Castronova, an authority on MMOs. In lauding the Chinese government action, Castonova offered what, to some, may seem like an alarmist view of in-game currency:

This action shows that at least one government is concerned about the way virtual worlds challenge its control of society. As virtual currencies take over more and more purchasing power, control over the effective money supply shifts from the central bank to the game developers.

If you are planning on buying gold for your World of Warcraft character, act quickly. The price may be going up soon because of an official crackdown which should affect availability in a negative way.

Information Week reports that on Friday the Chinese government enacted new virtual currency regulations which, among other provisions, make gold farming illegal: 

The ruling is likely to affect many of the more than 300 million Internet users in China, as well as those in other countries involved in virtual currency trading. In the context of online role playing games like World of Warcraft, virtual currency trading is often called gold farming...

The trading of virtual currency for real cash employs hundreds of thousands of people worldwide and generates between $200 million and $1 billion annually, according to a 2008 survey conducted by Richard Heeks at the University of Manchester.

He estimates that between 80% and 85% of gold farmers are based in China.

Basketball is wildly popular in China and so are online games.

Seeing big revenue in that combination, 2K Sports announced today that it will create an online version of pro hoops game NBA 2K for the Chinese market. Chinese Internet portal Tencent Holdings will partner with 2K Sports on the deal.

Licensing for the game includes all NBA team along with current and retired players. 2K Sports president Christoph Hartmann is quoted in a press release issued this morning:

The incredible popularity of basketball in Asia combined with the love of online games in that region makes this a very exciting project for 2K. For the first time, 2K is developing an online game combining our expertise in making the best-selling and top-rated NBA 2K video game franchise with the proven ability of Tencent for developing and operating highly successful online game communities in China.

Online gaming was a $2.75 billion business in China in 2008 and more than a billion Chinese viewed NBA programming during the just-completed season.

China is mounting a renewed crackdown against "undesirable" online games.

A Reuters reports cites Chinese state-run Xinhua news agency, which attributes the government action to concerns over crime and Internet addiction. More than 40 million Chinese now participate in online games.

Kou Xiaowei of China's General Administration of Press and Publication explained:

Although China's online gaming industry had been hot in recent years, online games are regarded by many as a sort of spiritual opium and the whole industry is marginalised by mainstream society. If we don't make adjustments, the industry will suffer sooner or later.

The lack of a content rating system and widespread availability of bootlegged products have hampered official efforts to regulate games.