China to restrict live-streaming growth

Future. China is kneecapping another one of its wildly successful tech markets, taking aim at live-streaming with regulations that would both limit how much live-streamers can make per day and how much fans can give per day. With so many influencers in the country now making millions from live-streaming, it’s possible that China will see a live-streamer exodus to countries that offer less restrictive oversight. 

Cut the stream

Beijing wants to take live-streamers down a notch.

• Authorities are looking to limit the amount of money that live-streamers — who typically work in areas such as gaming, music, food, and shopping — can earn per day.
• Combining tips, gifts, commissions from products, sponsorships, endorsements, and however else live-streamers make money, reports peg that possible limit at $1,750.
• Those earnings usually come in the form of tips, which regulators are also looking to limit how much fans can give per day.
• China also plans on passing tighter restrictions on what content can be live-streamed, likely making sure that content lines up with government morality standards.

Live-streaming in China is a $30 billion industry, with over 70% of the country either streaming themselves or watching streams. Separately, the country has recently passed regulations on live-streaming e-commerce, which has quickly exploded in popularity. 

Ironically, it was China’s runaway success with live-streaming that inspired many U.S.-based companies to roll out their own features.

Less of everything

Beijing’s moves are part of the larger tech clampdown in the country over the past few years, including for-profit education services, the online video-gaming industry, crypto mining, and even financial services providers. The government is hoping to rein in what it views as mobile-phone addiction, unhealthy spending habits, and an environment that lures young people into dreaming of becoming influencers over anything.

Of course, this is wreaking havoc on China’s über-successful tech companies, who are already feeling the squeeze of a government trying to take back control — after years of letting the free market benefit both the public and private sector. These moves have ended sky-high IPOs and sent stocks tumbling… and with live-streaming companies counting tip-fees as 40% of their yearly revenue, expect several more companies to go down in flames.