Still No Green Light for New NetEase, Tencent Games
Games from the two key players in China’s gaming industry were not on the lists of approvals posted between late December and this week by the state administration.
Two of China's gaming giants, NetEase Inc. (Nasdaq: NTES) and Tencent Holdings Ltd. (HKEX: 0700), were not among those who received video game approvals from Beijing regulators according to lists posted this week and in late December by state regulators.
In response to the news, reported Wednesday evening by various media, the stock of U.S.-listed NetEase was trading down more than 3 percent, at $249.49 per American depositary share, Thursday morning.
China's State Administration of Press, Publication, Radio, Film, and Television published a series of lists showing games which received licenses for publication after a freeze in the industry that lasted since March. While this was partially because of a restructuring in the state organization, Beijing has also tightened its grip as a response to the country's worsening rates of myopia, or near-sightedness, among youth.
The issue has drawn attention from the highest levels. China's leader Xi Jinping had addressed the high incidence of myopia among China's youth, saying governments at all levels should implement comprehensive and effective schemes to prevent and treat this problem, as reported by the official news agency Xinhua.
At the time, the crackdown in the gaming scene cut Tencent's market value by around $20 billion.
In late December, a senior official with the State Administration, Feng Shixin, announced it was working on the release of new licenses. He said the process might take some time, given to the large number of applicants. That statement sent the shares of Chinese game developers higher, with NetEase jumping 7 percent in New York.
In a series of lists published since on the agency's website, 164 game titles were getting a green light. Among them none came from the two key players in the industry, NetEase and Tencent.