Soft gamma repeaters are characterized by recurrent activity consisting of short-duration outbursts of high-energy emission that is typically of temperature less than 40 keV. One recent model of repeaters is that they originate in the environs of neutron stars with superstrong magnetic fields, perhaps greater than 10(14) G. In such fields, the exotic process of magnetic photon splitting gamma --> gamma gamma acts very effectively to reprocess gamma-ray radiation down to hard X-ray energies. In this Letter, the action of photon splitting is considered in some detail, via the solution of photon kinetic equations, determining how it limits the hardness of emission in strongly magnetized repeaters, and thereby obtaining observational constraints to the field in SGR 1806-20.