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China blocks teens, unverified users from spending on livestreaming apps

Written by Wency Chen Published on     2 mins read

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Platforms need to assign content moderators for every 50 online livestreaming channels.

Chinese authorities have tightened their grip on the country’s thriving livestreaming sector, banning virtual gifts for teens and users who aren’t using real names, and ordering platforms to set a spending cap for users.

In a move to entrench its control on the sector, the entertainment industry regulator, the National Radio and Television Administration, on Monday announced the new rules, which require platforms to assign one frontline content moderator for every 50 online livestreaming channels. Platforms also have to report the number of streamers, channels, and moderators on a quarterly basis to relevant departments at the province-level. Celebrities and foreigners must inform the authorities before opening a channel.

Under the new regulations, teenagers under 18 and unregistered viewers are no longer allowed to spend money during livestreaming sessions through the purchase of virtual gifts. In addition, platforms have been asked to report livestreamers and their agents who spread vulgar content, create hypes, or hire paid contributors to lure users.

Boosted by the popularity of smartphones and the long period people were locked into their homes this year, livestreaming in China has gained momentum. The scale of users is expected to reach 526 million by the year-end, up 4.4% compared to last year’s figure, per data from research firm iiMedia. For livestreamers and platforms, digital gifts, which viewers buy with real cash, are the main revenue source. In 2019, Chinese internet users spent RMB 140 billion (USD 21.27 billion) on livestreaming rewards, and the number is predicted to cross RMB 416.6 billion (USD 63.3 billion), according to iiMedia.

Kuaishou, the short-video sharing and livestreaming app with 302 million daily and 776 million monthly active users, earned RMB 31.4 billion in 2019 and RMB 17.3 billion (USD 2.6 billion) in the first six months of 2020, up from RMB 7.9 billion in 2017, the company’s prospectus revealed.

Huya, the gaming-centric livestreaming platform which is in process of a merger with Douyu, generated RMB 2.7 billion (USD 391.4 million) in the third quarter of this year, representing 94.4% of its total income. Huya, Kuaishou, and ByteDance didn’t immediately respond to KrASIA’s request for comment.

Fake numbers

Livestreaming shopping has become a real option for millions. New rules order platforms to check identities and certificates of the hosts regularly and manage those with high traffic with caution. Promotion campaigns need to be reported to the regulators 14 days before launching.

Inflating viewership and purchase data has been a common practice in the industry. During this year’s Double 11 shopping festival, for example, real-time data from a livestreaming session showed that 3.1 million people tuned in to the event. A Chinese media outlet, though, found out that only 11,000 were actual viewers.

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