Tencent Slumps After People's Daily Calls Honor of Kings Game 'Poison'
Tencent (700.HK) shares took a beating on Tuesday afternoon after the People's Daily newspaper called its popular game Honor of Kings game "poison".
The sharp criticism of Tencent, which has more than 900 million users of its WeChat messaging app, raised concerns Beijing could be set to crackdown on the online games industry, which are a big revenue generator for Tencent. The South China Morning Posthas more details :
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The game has more than 80 million daily active users, which means one in every 17 Chinese person is playing the game at any time, according to a commentary in the People's Daily, the Chinese Communist Party's mouthpiece newspaper.
A few tragic examples of overindulgence in the game were listed in the article: a 13-year-old jumping off a building after being scolded for playing the game, and a 17 year old who almost died of cerebral infarction after playing non-stop for 40 hours.
Tencent has imposed a one-hour a day limit on the playing of the games by children younger than 12, while children between 12 and 18 are limited to two hours a day. Barron's writer Daniel Shane covered the new rules earlier today: Please read Tencent to Limit Playing Time of Honor of Kings for Children Amid Addiction Concerns.
Barron's writer Isabella Zhong wrote in late May about the opportunity for Tencent and rival NetEase (NTES) to profit from the growing popularity of online games. China has overtaken the U.S. to become the world's largest online gaming market and some analysts expect the market to be worth $30 billion by 2018. For more details please read Tencent vs NetEase: Let the Games Begin.
Tencent shares last traded down 3.6% after falling as much as 5.1%.
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