China Announces Ban on Texas Hold’em Poker Apps

Chinese ban on Texas Hold’em poker social-gaming applications is a setback for the game’s growth in the country.

The People’s Republic of China’s Ministry of Culture has announced a pending ban on Texas Hold’em and other poker-themed social-gaming poker apps for use on mobile devices in the wake of an exposé aired by China Central Television (CCTV) last week.

The exposé by CCTV, which is the predominant state-operated broadcaster in China, focused on allegations that the Texas Hold’em apps being offered are not true “free to play” games, but instead serve as a cover for real-money gambling activities that are illegal under Chinese gambling laws.

As with a recent legal case in the US’s Washington State, the allegations in the exposé assert that the sale of in-game chips for use in the various poker apps not only constitutes illegal gambling, but is contributing to problem and addictive gambling problems of some Chinese citizens.

Other Chinese media outlets jumped on the gambling-story bandwagon, such as China’s finance-news source Sina (Sina.com.cn). Sina was one of the first to follow up the CCTV allegations, offering takes such as this on its own (translated): “For a long time, certain categories in the mobile game field always involve more or less ‘gambling’ elements, whether it is the ‘punching’ mechanism of some major mobile games or the more direct game of chess or even slot machines. All use the hearts of players in the ‘gamble’ mentality.”

In the wake of the anti-poker push, the Ministry of Culture has ordered that all “Texas Hold’em poker apps” are to be removed from online app stores serving the market, and that chat platforms and social-discussion groups pertaining to Texas Hold’em poker are to be disabled. Such censorship is a frequent occurrence in China with regard to controversial online and mobile content.

The ban officially goes into effect June 1.

Compliance efforts beginning

Some companies are already starting to take steps toward compliance. The English-language Asian Gaming News has reported that one Asian gaming firm, Tencent, has already yanked its popular World Series of Poker app from its prominent WeChat platform.

Tencent and the WSOP reached a content deal last July to bring the WSOP brand to the People’s Republic of China. That pact also included a WSOP China event designed to appeal to Chinese gamers. That event awarded prizes, though no entry fees were charged, and it was part of a joint effort by Tencent and the WSOP to bring the game to the Chinese mainland.

That business relationship may well be jeopardized by the social-gaming ban, as well as other efforts by other companies. As part of the ban’s imposition, China’s Ministry of Culture has declared that poker will no longer be recognized as an approved “competitive pastime”. Though the sharp focus of the ban is on social-gaming apps and possible gambling abuses therein, it also casts larger shadows on the growth possibilities for the game in China for the foreseeable future.

China-facing app developers take hit

Poker-themed social-gaming apps have grown in popularity in China, the world’s most populous country, with nearly 1.4 billion residents. Industry watchers there estimate that as many as 500 million Chinese citizens participate in some form of eGaming.

With a market that huge, it’s easy to see why a handful of gaming developers have explored giving poker, traditionally a Western game, increased visibility in the Chinese market. However, the future of those investments – and, in some cases, nascent revenue streams – is now in doubt.

Several such developers will take a financial hit as a result of the looming ban, perhaps none more so than Boyaa Interactive. Boyaa is the producer of “Texas Poker,” “Boya Dezhou Poker,” and other poker titles, and the company garners as much as 70% of its revenue from the sale of “free-to-play” coin packages for use in its games.

Boyaa has also launched a social gaming-themed Boyaa Poker Tour, the third occurrence of which was held in December. China’s ban on Texas Hold’em poker apps strikes Boyaa Interactive head-on, and the ban was announced just a day after Boyaa prominently featured its poker-game results in the company’s 2017 year-end financial reports.

As Boyaa reported: “The third Boyaa Poker Tour, our specially organized competition, was successfully held in the fourth quarter of 2017, which increased our brand’s awareness and players’ loyalty, enabling us to continue our steady steps towards becoming an internationally recognized poker game competition brand.”

Boyaa Interactive, which trades on the Hong Kong Stock Exchange, saw its share price slashed more than 12% within 24 hours of the ban’s announcement and it has continued to slide since.