Chinese tech stocks experienced a decline as the country’s cyberspace regulator proposed limiting smartphone usage for children under 18. Shares of companies like Alibaba and Bilibili fell on consecutive days following the announcement. According to the proposed law, children would be allowed a maximum of two hours of phone usage per day. This initiative comes after the implementation of gaming restrictions for children in the world’s second-largest economy four years ago. The new regulations would also prohibit children from accessing the internet on mobile devices between 22:00 and 06:00 local time.
The Cyberspace Administration of China’s (CAC) proposal involves industry players, including mobile phone manufacturers, apps, and app stores, being required to develop a “minor mode” function to set usage limits based on age. For instance, children between 16 and 18 years old would be allowed two hours of screen time, while those under eight years old would have only eight minutes.
The proposal is currently open for public feedback, and technology giants are likely to be responsible for enforcing the rules, similar to how they handled gaming restrictions. Despite potential workarounds, experts believe that the gaming restrictions have been relatively well implemented. As a result of the news, shares of Alibaba and Bilibili saw significant declines in Hong Kong, while Tencent experienced a minor increase.
China has previously implemented measures to address video game addiction among minors. In November 2019, they imposed a curfew on online gaming for children, restricting their playtime during certain hours on weekdays and weekends. In recent years, the increased regulation has impacted Chinese technology companies, with the US overtaking China as the world’s largest gaming market by revenue.