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From LinkedIn to Fortnite and Yahoo: big techs are leaving China

The Chinese government's restrictive regulations towards tech companies are prompting several tech giants to leave the country. The list gets longer: first Facebook and Twitter, then LinkedIn, now also Fortnite and Yahoo

From LinkedIn to Fortnite and Yahoo: big techs are leaving China

The great flight of American technology companies from the Chinese market continues. This time it's the turn of Yahoo e Fortnite, the Chinese version of the video game owned by Epic Games. Apparently, the restrictive policies on freedom imposed by the Chinese government are increasingly stringent and have left no other choice for the big American big tech companies, despite the large pool of users they are forced to give up.

The Chinese version of Epic Games' popular Fortnite video game has stopped working since November 1st, it is no longer possible to register or download the game, and from November 15th the company will completely disable the servers hosting the game in China. Perhaps many do not know it but Fortnite had never been officially approved by Chinese government bodies: it was introduced in 2018 thanks to a temporary agreement between Epic Games and the Chinese giant Tencent. Unlike the original version, it had a different name, precisely Fortress Night, and contained some modifications and censorships also in its functioning due to the restrictions imposed by China on video games.

Epic Games has not given an explanation of the reasons for its decision, which was also influenced by commercial reasons. Certainly at the base, the lack of official approval by the government which prevented the "microtransactions". Therefore, the renewal of the collaboration between Epic Games and Tencent could not have generated revenues.

China has always had an iron grip on the Gaming, placing very stringent restrictions on consumption by children and adolescents. It recently restricted use for under-18s to one hour a day, 20-21pm, on Fridays and public holidays only. Furthermore, a ban on digital purchases (i.e. microtransactions) has been placed on children under the age of eight, for the 9-16 age group there is a spending limit of around 7 euros per transaction and 27 euros per month, for the age group from 17 to 19 instead 13 euros and 53 euros per month. A problem that not only affects young people, but above all businesses since most of the titles with microtransactions are from the Dragon.

But that is not all. The government has also prepared new guidelines forvideo game approval. He will have to assess whether the game violates Chinese laws, disseminates state secrets, encourages gambling and violence, or incites minors to self-harm. Another burning point concerns the representation of romantic and homosexual relationships, which are in fact prohibited: if the regulator fails to understand the gender of the character right from the start, it is considered problematic. Further attention will be paid to the representation of historical events, with zero tolerance towards altered representations of Chinese history, and religious issues.

But why this fury of the Chinese government on the video game industry? The Communist Party of China has defined video games as a "spiritual opium", especially for the little ones, motivated only by profit at the expense of social welfare. Gambling addiction is a sensitive issue that with the digital revolution could explode into an even more serious problem. In China it is also very popular. Chinese gamers hold the record for the number of hours played per week, averaging 12.4 hours per week versus the global average of 8.5, according to a study conducted by cloud services company Limelight Networks.

Therefore, behind these restrictions there would be "noble" motivations. However, this is not the first time China has taken an authoritarian stance, indeed it has often been accused of violate individual freedom of its inhabitants, also affecting the country's economy.

But China has also played its part. In the 2000s, the spread of the internet gaming market had led the Chinese government to ban the production and distribution of foreign consoles on the territory. A block lifted in 2015. Meanwhile, however, there has been an explosion of smartphones in China, and thanks to its ease of use one of the few platforms to play on. And to make the most of the characteristics of mobile gaming, the Chinese gaming industry was among the first to develop free models for playing, using microtransaction practices, creating addiction and habituation.

Back to today, Fortnite is not alone. Yahoo also left China on November 1st. This is the second major technology company in the United States that in recent weeks has decided to reduce its operations in China, after Microsoft's LinkedIn, the last major US social network still active in the country (Facebook e Twitter have already left the market for years). The cause is a "significantly more difficult operating environment to manage and the increased restrictions imposed". However, a new version of the platform, adapted to China's criteria, has been announced. 

“Yahoo remains committed to our users' rights and a free and open Internet. We thank our users for their support,” a statement read. You had already embarked on a process of downsizing your operations, so much so that in 2015 you closed your Beijing office. However, his withdrawal is purely symbolic given that several Yahoo services and the web portal have been blocked in the country by the "Great Firewall" and are only visible through the adoption of VPNs.

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