Tencent Shrugs Off Market Concerns After Rationing Game Time for Chinese Kids

Tencent (TCEHY, -0.70%) surprised the concern that a move to limit the playing time for some users of his game “honor of Kings”, which was the most important, could hurt profitability, saying that Run only a small part of their global user base.

The company said Sunday that “Kings of Honor” players under 12 would be limited to one hour of play a day, while those over 12 to 18 would be limited to two hours a day in response to The concerns of teachers and parents that some children were addicted to gambling.

Tencent shares, China’s largest social games and social media by business volume, fell by nearly 4% this week to the end of trading Tuesday, clearing about $ 12 billion of its market value. The stock rose more than 1% Wednesday, reversing the previous losses and compared to a wider market. It represents more than 40% this year.

The spokesman for the Communist Party of China, People’s Daily, also criticized Tencent twice this week, describing the work “honor the Kings” as a poison and calling for tighter controls on online gaming regulation, which weighed Around their actions.

“We do not expect that these measures will have a significant impact on our global financial results,” Tencent said in a statement. An email response to a request for comments to Reuters.

Tencent also said that it will strengthen the requirement for real name registration for all users and that it would establish a parent platform launched earlier this year, making it easier for parents to monitor their children’s game account activity .

It was not entirely clear whether Tencent, which has portfolio of more than 200 games can actually impose restrictions on the playing time or ease with which players are able to circumvent the measures.

The CNG’s Chinese game industry database says “honor of the Kings” has recorded a turnover of more than 5.5 billion yuan (810.47 million US dollars) in the first quarter, which represents almost Half of revenue of 12.9 billion yuan of Tencent.

Tencent, one of the most valuable in Asia with a market value of 2.6 billion Australian dollar companies ($ 333 billion), has spread its tentacles in almost every aspect of Chinese life, which makes it vulnerable To the regulatory measures imposed by Beijing to a growing political risk, when in China.

Chinese regulators have launched an offensive against radicals deemed inappropriate on the Internet, including closing celebrity websites and restrictions on what users can post, forcing individuals and companies to walk a fine line to deal with To the concerns of the government.

The popularity of “honor of the Kings” has provoked numerous complaints from teachers and parents fear that children will become addicted to gambling, half of users are under 24 years, according to Chinese mobile data company Jiguang.

A broader or heavier government offensive on the online gambling industry could pose major challenges for Chinese technology champions.

“The question now is whether public criticism followed by a regulation of the state of the online gaming market booming in China,” said Paul Haswell, a partner at technology law firm Pinsent Masons.

“Seeing the market both closed or through public criticism, whether by government intervention, is a big blow to the Chinese gaming industry.”

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