M ORAL PANICS over new media are old hat. The social effects of novels, films, comic books and pop music were condemned by the grumpy reactionaries of the time. In recent years video games have been a popular villain. Exasperated parents and opportunistic politicians have long fretted that they make players lazy and listless, or else unpredictable and violent. Those concerns turned out to be largely misplaced. But new worries about the addictiveness of games, and the danger that poses to children in particular, have more substance to them and are already prompting a regulatory crackdown. The industry would be wise to get ahead of the problem.

China, the world’s biggest video-game market, is leading the charge. The government clamped down on the approval of new games earlier this year, and stopped approvals altogether in October. Shares in Tencent, which built its business on video games and is one of the world’s largest internet companies, have fallen by 28% since the start of the year (see article). China is an authoritarian state prone to overreaction. But it is not the only country that is worried. Japan and South Korea, both liberal democracies, have passed laws designed to regulate a video-gaming industry whose products are increasingly seen as addictive and harmful. And as business models refined in Asia have come to the West, lawmakers in Europe and America are becoming more concerned, too.

Such concerns feel more credible than prior panics, for two reasons. The first is that much gaming now happens online, and generates reams of behavioural data. This allows publishers to monitor exactly how customers are playing games, and fine-tune them to make them as compelling as possible.

The second is the realisation that players will happily pay real money for virtual goods. These can be upgrades, costumes or weapons for their in-game characters, or (more cynically) a lottery-style “loot box” whose contents are unknown in advance, but might prove valuable enough to resell to other players. Since the marginal cost of creating virtual items is zero, they are very profitable for developers. That has given rise to a “freemium” business model, of which Tencent was a pioneer, whereby games are given away cheaply or free but players are constantly nagged to spend money on in-game items. All this has been supercharged by smartphones, which mean people can keep playing—and paying—at all hours of the day.