Antitrust and Unfair Competition Conduct in the Network Game Industry in China

We introduce two related cases between a video game company and a live broadcasting company in China that were fought in terms of both Anti-Monopoly Law and Anti-Unfair Competition Law, involving Copyright Law. The High Court rulings indicate that it generally does not conduct relevant market definition based on one game alone, and that it treats animated moves embedded in games as copyright-protected content. These conclusions will have a profound impact on the broadcasting industry in terms of its implications to business models and revenue streams.

By Vanessa Yanhua Zhang & John Jiong Gong¹

I. INTRODUCTION

The gaming industry has gone through dramatic growth over the years in China. In 2020, total gaming market revenue has reached RMB 278.7 billion, or US$ 42.7 billion, a 20.7 percent growth over the previous year.² About RMB 209.7 billion is associated with mobile gaming, accounting for about 75.2 percent of the market.³ The game broadcasting market has seen even better growth in 2019, having reached a market size of RMB 20.8 billion, or US$3.0 billion.⁴ Both markets are relative competitive with no significant barriers of entries, considering the upfront cost is not high and the R&D cycle is generally short. While both industries have been enjoying their good days so far, the relations between the two sides are contentious so far.

The game owners would certainly like to monetize the revenue opportunities in live broadcasting businesses via enforcing copyr