China will allow foreign firms to provide online game downloads and streaming services in the country by the end of the year as long as they comply with the country’s strict content regulations and data security requirements, local newspaper Beijing News reported on Thursday.

Why it matters: The move echoes China’s pledge to give foreign capital more access to the world’s second-largest economy amid the trade war with the US. The country has long complained of China’s lack of market access for overseas players.

  • In March, top Chinese officials said that Beijing was ready to open up the country’s economy to more market-based competition and international trade.
  • Foreign companies’ engaged in publishing online content are especially restricted by the country’s internet and media watchdogs.

Details: The plan is part of the government three-year project to expand the reform and opening-up of the service industry, which focuses on letting more foreign capital participate in the finance, education, and internet content sectors, said the Beijing News.

  • The new plan would require foreign streamers to comply with the country’s online content control system, in which movies and television shows must obtain licenses from regulators before being made available.
  • Analysts said the new plan would allow foreign streaming service providers such as Netflix, YouTube, and Spotify to enter the Chinese market, but it would take time for them to earn the trust of Chinese regulators.

Context: Foreign firms and their affiliates are not currently allowed to publish online content such as text, maps, games, cartoons and audio, and video, without approval from the government, according to rules released in February 2016.

  • The rules, which took effect in March 2016, led to the shutdown of Apple’s iTunes Movies and iBooks services in China in April the same year.

Writing about semiconductors and telecommunications.

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