In early August, a text was published in China that called online gambling "spiritual opium" and that caused Chinese gaming companies to fall on the stock market.
In China, they want to limit how much time children and young people spend on gaming and the restrictions have also affected Swedish computer game companies and their share prices.
- When there are more restrictions and there is talk about it, all the world's gaming companies go down, says Tomas Otterbeck, stock analyst at Redeye.
Addictive free games
He explains that it is above all "free to play" games that are criticized in China, ie the kind of games on which the entire mobile gaming industry is based.
The business idea is that the games, which are free to download, create an addiction that makes the player come back and makes the player buy things in the game.
"Investors view the entire sector more negatively and the Swedish companies are dragged along like children with the bathing water," says Erik Sprinchorn, manager at Tin Fonder, whose fund has invested in several of the Swedish computer game companies.
Concerns about more regulations
Erik Sprinchorn is not worried that the restrictions will spread around the world, but stock analyst Tomas Otterbeck is not so sure.
- There is a concern among investors that this is spreading in Europe, that this has set a ball rolling, he says.
During the beginning of the covid 19 pandemic, many computer game companies around the world got an extra boost as many stayed at home and played more than usual.
Now that the world has reopened, the players have become fewer and the share prices have fallen back.
Despite the fact that many companies have fallen sharply on the stock exchange in the last six months (see fact box below), Erik Sprinchorn at Tin Fonder is optimistic.
- Digital entertainment will not disappear, it is a structurally growing phenomenon.
And Swedish companies are boxing well over their own match weight, so I think it will go very well for the Swedish computer game companies, he says.