China internet authority
formalizes regulations for live-streaming industry
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[November 04, 2016]
By Catherine Cadell
BEIJING
(Reuters) - Chinese internet authorities have formalized controversial
rules regulating the country's fast-growing live-streaming video
industry, in a move that strips out smaller competitors and places
hard-line surveillance measures on leading firms.
In an announcement posted on their website on Friday, the Cyberspace
Administration of China grouped a handful of earlier restrictions under
a final 24-point regulation that will come into effect on Dec. 1.
The rules require streaming services to log user data and content for 60
days, and work with regulators to provide information on users who
stream content that the government deems threatening to national
security or social order. Both users and providers are punishable under
the regulations.
The law also codifies rules that ban online news broadcasting services
from original reporting, requiring them to identify sources and
non-selectively reproduce state-sanctioned information.
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China's live video streaming industry has experienced booming growth in
the past two years as dozens of video and social media sites scrambled
to add the updated capabilities to their existing services.
Credit Suisse Group analysts estimate the industry could top $5 billion
by the end of 2017, driven by cheap bandwidth and a growing population
of young mobile users.
The industry's exponential growth attracted increased scrutiny from
government authorities in 2016. In April, Chinese authorities called on
20 of the country's top firms to join a self-criticism coalition, saying
the industry was damaging China's youth by proliferating content
including pornography, fraud and terrorism.
On June 1 companies including Baidu Inc, Sina Corp, Sohu.com Inc and
Youku Tudou, acknowledged new rules as part of the group, including
requirements for real-name authentication.
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A man looks at his smart phone inside a shopping mall in downtown
Shanghai, September 25, 2013. REUTERS/Carlos Barria
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While the latest move places wide-reaching restrictions on the sites, it
also signals an official sanctioning of the industry and its top players
by Chinese officials.
Much like China's earlier online video and music industries, the
regulations put pressure on smaller competitors and bring larger firms
into line with regulators, offering more growth opportunities for a
smaller number of controllable companies.
"One of the things the government always wants to do is narrow the
playing field to a smaller number of higher profile known entities,
ideally ones that have a better track record of cooperating with the
government," says Mark Natkin, Managing Director at Marbridge
Consulting.
"In the long run it's actually relatively beneficial to the large
companies."
In May the government handed down 588 licenses for prominent media
outlets and live-streaming sites, effectively banning all unapproved
services.
(Reporting by Catherine Cadell; Editing by Simon Cameron-Moore)
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