Tencent stocks plunge amid fears of a Chinese government gaming crackdown | PC Gamer - mccraryhisamoss
Tencent stocks steep amid fears of a Chinese government gaming crackdown
Early along Tuesday the stocks of several gaming companies, Tencent among them, fell sharply by upbound to 11% at Hong Kong markets, afterwards the Propaganda Section of China's Ideology Party proclaimed at the ChinaJoy expo that video games needful to be "good, clean and secure". Shares of companies suchlike Tencent, NetEase and XD started tumbling in response. The shares of China Moving Games and Entertainment Group (CMGE) even fell by a whopping 20%.
Several gaming companies from elsewhere in Asia, including the Japanese giants Capcom, Konami and Nintendo, also took a hit, but non to much a degree. Spell at the clock of writing, Tencent shares have recovered to -6%, the company has lost a aggregate of $110 billion since the start of last week.
Breakage: 😳😳😳Chinese gaming stocks are in free fall today. NetEase is perfect 15%. Tencent is down 9%. Bilibili is down 9.5%. XD is down 18%. Information technology comes after Propaganda Department of the Chinese Communist Party said at #ChinaJoy that games need to be good, clean and secure. pic.chirrup.com/7uHeDhqP1aAugust 3, 2021
Shortly afterwards, a newspaper managed by China's established news agency Xinhua published a report calling television games 'spiritual opium ' with a subtle effect on teenagers, and called Tencent out specifically American Samoa one of the independent drivers of this.
Publications ran past Xinhua are regarded as representing the Chinese government's official posture, but there was a little of an about-turn on this one and the article has been deleted. Nevertheless the phrasing rang dismay bells, as the describe was similar to an article that ran in other newspaper affiliated with the Authorized News Agency some 20 days ago, vocation games 'digital heroin'. Piece the Chinese government is generally involved in growing its video games industry ever since ending its ban along console gaming, insiders have noted that Communist China's president Xi Jinping isn't a huge buff of games.
Not sure if calling games "opium" reflects central government's official position, but it certainly is in line with President 11's thinking.At the two sessions meetings in March, Xi explicitly referred to games as a problem that needs to be "solved".https://t.co/osmCiwQB5F https://t.co/3EngY8pfGI moving picture.twitter.com/9jcwGRTjEUAugust 3, 2021
To realize why a single remark made such waves, we have to look at the influence of regulators happening the Chinese gaming industriousness. Backwards in 2018, regulators became aware of the potential harm of in-game monetisation and loot boxes and suspended monetisation licenses. Measures such American Samoa Tencent using face recognition to stop children from gaming all Nox and designing 12 rules for streamers to foster "healthier environments" are direct responses to authorities regulation—all in an crusade to keep gaming baby-friendly.
Companies are afraid of angering regulators in China, since crackdowns tush in effect mean the downfall of entire industries. Close to fortnight ago, China banned off-campus education , as education shouldn't be a source of benefit, leading to massive closures and job losses in the online education sector. The fear is that should regulators find gaming ineligible for children for some reason, this could magical spell the end of gambling as it currently exists in China.
Tencent has since released a statement promising to further demarcation play clock for accounts listed to minors, to an hour during weekdays and ii hours during school holidays and national holidays. Following a new announced age-based scoring system for games in China, therein statement Tencent is now too rational about banning its games for children under 12 altogether.
Source: https://www.pcgamer.com/tencent-stocks-plunge-amid-fears-of-a-chinese-government-gaming-crackdown/
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