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Shares of Tencent and rivals plummeted Tuesday after Chinese state media criticized online gaming as “opium for the mind,” fueling investor concerns that the companies’ popular games could be swept up into a broader regulatory crackdown.@kepinghttps://t.co/vih5Pgk2jE
— Jonathan Cheng (@JChengWSJ) August 3, 2021
China is cracking down on its video game companies now. More bad news for all the Wall Street firms that bet on the CCP: https://t.co/ROK9l2rcLR @WSJ
— Josh Rogin (@joshrogin) August 3, 2021
Tencent had come through much of China's tech crackdown relatively unscathed--but that is changing fast. Today its shares dropped more than 10 per cent after state media branded online games - a key driver of Tencent's revenues - as "spiritual opium" https://t.co/VDrO99J212
— Hudson Lockett IV 康河信 (@KangHexin) August 3, 2021
Another problem listed as "to be solved" in the same speech is the "private tuition mess", which has just been solved in the past 2 weeks.
— Henry Gao (@henrysgao) August 3, 2021
So you know what will happen to the gaming industry. pic.twitter.com/331Rt7udkr
Clearly someone at Economic Information Daily got ahead of themselves here and tried to feed into the mood from Beijing of more regulation on tech. But recently, I get the feeling that regulators have been taken aback by the sell-off in Chinese tech names and other assets
— Arjun Kharpal (@ArjunKharpal) August 3, 2021
Fresh off the war on education, tech and celebrity culture, is China starting the war on video games? https://t.co/2LRWmn1wyS
— Richard Hanania (@RichardHanania) August 3, 2021
Tencent announced it will introduce measures to reduce minors' time & money spent on games. It also called for an industry ban on gaming for children under 12 years old.
— Dare Obasanjo (@Carnage4Life) August 3, 2021
So China’s govt is against kids studying hard or playing games. What’s the end game?https://t.co/jv49Z9JguB
But wait it’s back! #China state media report criticizing video games returns online— with new boring title “Online Gaming Grows Into Industry Worth Hundreds of Billions of Yuan”. Scraps harsh words games are “opium of the mind”, “electronic drugs”. https://t.co/qWLfSe6C0C pic.twitter.com/laP3PCgTGY
— Eunice Yoon (@onlyyoontv) August 3, 2021
But on the round, the reasons are secondary to the party’s political intervention to place shackles over these new, digital firms, -> contradiction in which stifled innovation results, as Jack Ma warned in his last major address as a leading entrepreneur. /4
— George Magnus (@georgemagnus1) August 3, 2021
TenCent lost $60B in market cap overnight as China’s state media calls video games “spiritual opium” because of gaming addiction. Both studying too hard (tutoring apps) and playing too hard are bad.
— Dare Obasanjo (@Carnage4Life) August 3, 2021
Success of Apple in China is remarkable given how even local companies suffer. https://t.co/2ZbwunxszJ
Tencent shares on track for the worst day in 10 years. pic.twitter.com/QOAFthYC9o
— David Ingles (@DavidInglesTV) August 3, 2021
China tech crackdown rolls on, today the gaming sector. But what do all these sector campaigns in tech, finance and data actually mean? Is China boldly going, or screwing up? /1 Tencent Shares Dive After Chinese Media Brand Online Games ‘Spiritual Opium’ https://t.co/HZI5ggzVVl
— George Magnus (@georgemagnus1) August 3, 2021
The "China's government wants tech to be about national power rather than human enjoyment" theory continues to make correct predictions: https://t.co/1byMxOJgXj
— Noah Smith ? (@Noahpinion) August 3, 2021
I don't think the regulators themselves thought that this would be the reaction. So you saw the Chinese securities regulator talk to investment bankers the other day to calm the markets. There is an overall mood of regulators realising they're moving too fast
— Arjun Kharpal (@ArjunKharpal) August 3, 2021
Some second-tier gaming stocks in Hong Kong are also taking a huge beating.
— Josh Ye 葉嘉栩 (@TheRealJoshYe) August 3, 2021
CMGE down a whopping 20%.
iDreamSky slid 17%.
Razer down 4.3%. pic.twitter.com/axf2e5ltlJ
In morning trading in Hong Kong Tuesday, Tencent fell more than 10%, smaller peer NetEase 15% and video and gaming group Bilibili 14% https://t.co/l07OGcH9qO
— WSJ Markets (@WSJmarkets) August 3, 2021
Journal tied to state media @XHNews slammed online gaming as “opium” for kids & singled out @TencentGlobal for game “Honor of Kings”, sparking share sell-off & talk industry could be next #China target. Report deleted w/i hours. Beijing appears sensitive not to stoke uncertainty. pic.twitter.com/OwDmUhbBWJ
— Eunice Yoon (@onlyyoontv) August 3, 2021
Crackdown at home will drive gaming cos to seek more opportunities overseas, a trend already happening in recent years. This year, Tencent has been expanding globally at a record speed. Honor of Kings' maker TiMi launched 3 studios in North America. https://t.co/pIbSwLFnmm
— Josh Ye 葉嘉栩 (@TheRealJoshYe) August 3, 2021
You can come up with reasons on a case by case basis to see China blazing a trail that many liberals would support to act against consumer technologies that add little to economic welfare and may undermine it /3
— George Magnus (@georgemagnus1) August 3, 2021
Not sure if calling games "opium" reflects central government's official position, but it certainly is in line with President Xi's thinking.
— Henry Gao (@henrysgao) August 3, 2021
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 pic.twitter.com/9jcwGRTjEU
One big implication is for investors, many unaware mostly of which assets their fund managers own. Something Beijing could care less about. But the fuller consequences of this crackdown for China’s dynamic private sector have not been costed or reckoned. Ends
— George Magnus (@georgemagnus1) August 3, 2021
We may be seeing the beginning of an attack on Chinese video game companies. If Beijing's policies can really reduce the amount of time people spend on these games, it will probably be a good thing for the economy even if it...https://t.co/g22xubQZ7F via @financialtimes
— Michael Pettis (@michaelxpettis) August 3, 2021
This comes amid a huge year that the industry has been having so far. Tencent, ByteDance and NetEase have been investing in gaming firms at a record rate.
— Josh Ye 葉嘉栩 (@TheRealJoshYe) August 3, 2021
Tencent had invested in a record 62 gaming firms in H1, which is about a new deal every 3 days.https://t.co/XwymQL2U4G
Update: Seems like gaming companies’ lobbying power within the system still holds tremendous sway. The story that calls gaming “opium” has been removed by the same state media.
— Josh Ye 葉嘉栩 (@TheRealJoshYe) August 3, 2021
Tencent is still in Beijing’s good graces it seems. https://t.co/9Hqaut1p7L pic.twitter.com/ik6Ux5wFZA
Much of what’s going on falls under Xi’s social agenda, aka common prosperity, in which the CCP will act against tendency of markets to exacerbate inequality or threaten party’s control of data, unchallenged power and so on. /2
— George Magnus (@georgemagnus1) August 3, 2021
Chinese state media has now deleted an article it published today in which it called online games "opium" and likened them to drugs. The article called for more restrictions and sent Tencent stock tanking 10%. Article now gone. https://t.co/ET3DSduHmV
— Arjun Kharpal (@ArjunKharpal) August 3, 2021
Breaking: ???Chinese gaming stocks are in free fall today. NetEase is down 15%. Tencent is down 9%. Bilibili is down 9.5%. XD is down 18%.
— Josh Ye 葉嘉栩 (@TheRealJoshYe) August 3, 2021
It comes after Propaganda Department of the Chinese Communist Party said at #ChinaJoy that games need to be good, clean and secure. pic.twitter.com/7uHeDhqP1a
Hong Kong stocks slip after CCP mouth piece Xinhua News' attack on online gaming
— BenjaminT /Boycott 2022 Genocide Olympics (@BenjaminT0001) August 3, 2021
BlackRock & Vanguard, with your money, are among the Top 10 owners and Top 10 Mutual Fund Holders of Ponzi Chinese NetEase. Inc.https://t.co/vxILgA1K6z pic.twitter.com/W4sikvoopb
A quick market report here. A dedicated piece is in edit.
— Josh Ye 葉嘉栩 (@TheRealJoshYe) August 3, 2021
Hang Seng drops 1% as Tencent paces losers after media likens mobile-gaming addiction to ‘opium’.
Mainland investors were net sellers of Hong Kong stocks for an 11 straight days on Monday.https://t.co/ypodPauvsf
Hong Kong stocks skid as new attack sends Tencent, NetEase tumbling while market awaits Alibaba earnings https://t.co/uHkFRzu7hW
— South China Morning Post (@SCMPNews) August 3, 2021
Chinese newspaper calls gaming ‘spiritual opium’, fanning crackdown fears https://t.co/mbnHFmrbCi
— South China Morning Post (@SCMPNews) August 3, 2021
Japan Game Stocks’ Plunge Show Their Exposure to Chinese Regulationshttps://t.co/0Csdlmb2t6 pic.twitter.com/AzleMdsSfn
— たまこ (@arad_tamako) August 3, 2021
Japanese video game shares plunged in Tokyo Tuesday, as the country’s stock market was given a jolting reminder of how exposed some sectors are to the vagaries of Chinese regulation https://t.co/a16BwebhOU
— Bloomberg Next China (@next_china) August 3, 2021
A jolting reminder of some Japanese stocks’ exposure to China came today as some videogame firm a dropped in Tokyo. The plunge came after Tencent’s fall, amid fears gaming might be the next sector targeted by Chinese regulators.
— Gearoid Reidy (@GearoidReidy) August 3, 2021
https://t.co/mZVjWMZjNf
It should be noted that the Chinese government has gone after online gaming (and gaming in general) before with some regularity. In the end, it was usually more bark than bite, more slowdown than shutdown. Not sure this time will be that different. https://t.co/hurp7fbhRt
— Taisu Zhang (@ZhangTaisu) August 4, 2021