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Tencent Shares Drop After China Media Criticizes Video Games

  • August 03, 2021

Despite the uncertainty, nervous investors were quick to sell shares.

Tencent, a technology conglomerate with a big presence in social media and entertainment in addition to video games, saw its shares drop about 10 percent at one point, though the losses moderated later on Tuesday and ended down about 7 percent. NetEase, another mainland video game company, saw its shares drop nearly 9 percent.

The article’s headline — “A ‘spiritual opium’ has grown into an industry worth hundreds of billions of dollars” — left little doubt at the thrust of the piece. It cited a litany of threats posed by video games, including diverting attention from school and family and causing nearsightedness.

“No industry or sport should develop at the price of destroying a generation,” it said.

The article singled out Tencent, which owns games popular in China like Honor of Kings as well as titles popular around the world, like League of Legends.

Tencent on Tuesday released a statement on its WeChat social media network describing some of the limits it recently decided to put into place, like limiting game time for minors and increased efforts to ferret out those who lie about their age to play.

The scrutiny isn’t new to Tencent or the industry. More than half of Chinese internet users play online games, according to government statistics. In the past, officials have worried that games could hurt children’s academics, damage their eyesight and reduce the country’s military readiness. In 2019, the authorities limited the amount of time young people could spend playing games online.

Article source: https://www.nytimes.com/2021/08/03/technology/china-video-game-tencent.html

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