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Tencent cuts marketing pay off games amid China crackdown: sources

BEIJING/SHANGHAI (Reuters) – Chinese tech giant Tencent Holdings Ltd is cutting the marketing budget for its key gaming division, two sources told Reuters on Thursday, amid a crackdown for the industry inside mainland and also a lengthy freeze on new game approvals.

The move has come about as Tencent, the world’s largest gaming company by revenue, and its peers have faced rising regulatory push back from Chinese authorities, that have not approved any new games since March.

“Marketing funds are actually chopped back,” said among the many people, a professional with Tencent Games, asking not to be identified due to sensitivity within the matter. It had not been immediately known simply because much the budget were being reduced.

Bloomberg earlier reported, citing an internal letter, that Tencent was cutting branding budgets for gaming and this games without government licenses would have to return their unspent money towards group.

In the interior memo, staff informed the move is needed the provider “endure the tough times together”, Bloomberg said.

Tencent declined to comment when contacted by Reuters.

The social media-to-payments firm has produced a few attempts to meet Beijing’s need tighter controls to combat gaming addiction and increasing near-sightedness among youth.

Authorities in August necessary the publishing regulator to regulate the volume of new online video games in order to limit just how long young Chinese spend playing such games.

(Reporting by Pei Li and Adam Jourdan; Editing by Muralikumar Anantharaman)

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