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  CORRESP

    Simpson Thacher & Bartlett

    icbc tower, 35th floor

    3 garden road, central

    hong kong

    telephone: +852-2514-7600

    facsimile: +852-2869-7694

    Direct Dial Number

    E-mail Address

    +852-2514-7620

    ygao@stblaw.com

    September 8, 2023

    CONFIDENTIAL AND VIA EDGAR

    Division of Corporation Finance

U.S. Securities and Exchange Commission

100 F Street, N.E.

Washington, D.C. 20549

Attention:   Ms. Melissa Walsh

                   Mr. Stephen Krikorian

                   Mr. Tyler Howes

                   Mr. Christopher Dunham

  Re:	Phoenix New Media Ltd
Form 20-F for the Year Ended December 31, 2022
File No. 001-35158

  Ladies and Gentlemen:

  On behalf of our client, Phoenix New Media Limited, a company organized under the laws of the Cayman Islands (“PNM” or the “Company”), we respond to the comments contained in the letter from the staff (the “Staff”) of the Securities and Exchange Commission (the “SEC” or the “Commission”), dated July 27, 2023 (the “July 27 Comment Letter”) relating to the Company’s annual report on Form 20-F for the fiscal year ended December 31, 2022 filed with the Commission on May 1, 2023 (the “Annual Report”).

  Set forth below are the Company’s responses to the Staff’s comments in the July 27 Comment Letter. The Staff’s comments are retyped below in bold italic font for your ease of reference. All capitalized terms used but not defined in this letter shall have the meaning ascribed to such terms in the Annual Report. The Company respectfully advises the Staff that where the Company proposes to add or revise disclosure in its future annual reports on Form 20-F in response to the Staff’s comments, the changes to be made will be subject to relevant factual updates and changes in relevant laws or regulations, or in interpretations thereof.

    Simpson Thacher & Bartlett

     September 8, 2023

    -2-

    Division of Corporation Finance

U.S. Securities and Exchange Commission

  Form 20-F for the Fiscal Year Ended December 31, 2022

  Notes to Consolidated Financial Statements

  Note 1. Organization and Principal Activities, page F-10

  1.Please provide a detailed legal analysis regarding whether the Company and its subsidiaries meet the definition of an “investment company” under Section 3(a)(1)(A) of the Investment Company Act of 1940 (“Investment Company Act”). In your response, please address, in detail, each of the factors outlined in Tonapah Mining Company of Nevada, 26 SEC 426 (1947) and provide legal and factual support for your analysis of each such factor.

  The Company respectfully submits that it is not an investment company because it is primarily engaged, through wholly owned subsidiaries, in the digital media business.

  The Company’s Strategy and Structure

  As will be discussed in further detail below, the Company believes that it is and always has been primarily engaged in the digital media business with a focus on generating revenue through selling advertisements and premium content across its integrated platform of Internet, mobile and TV channels in China. At no point in its history has the Company held itself out to be engaged in the business of investing, reinvesting or trading in securities.

  Under the laws and regulations of the People’s Republic of China (“PRC”), the operation and provision of internet information services to the public within the PRC is subject to foreign investment restrictions and license requirements. Therefore, PNM is not a Chinese operating company but a Cayman Islands holding company with operations primarily conducted by its direct and indirect subsidiaries in China and through contractual arrangements with Variable Interest Entities (“VIEs”) based in China.

  The Company relies on and expects to continue to rely on contractual arrangements with VIEs in China and their respective shareholders to operate its Internet and mobile businesses that are subject to foreign investment restrictions. These contractual arrangements allow the Company to:

  •receive substantially all of the economic benefits from the VIEs and their subsidiaries in consideration for the technical and consulting services provided and intellectual property rights licensed;

  •have the power to direct the activities that most significantly impact the economic performance of the VIEs and their subsidiaries; and

    Simpson Thacher & Bartlett

     September 8, 2023

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    Division of Corporation Finance

U.S. Securities and Exchange Commission

  •have an exclusive option to purchase all of the equity interests in the VIEs when and to the extent permitted under PRC laws.

  As a result of these contractual arrangements, the Company is the primary economic beneficiary of each of its VIEs and consolidates them under U.S. GAAP as controlled subsidiaries.

  The Company maintains a significant amount of liquid assets to fund its current and future operations and potential strategic transactions and acquisitions. PNM has a formal policy regarding its cash management process. The goal of the policy is to preserve the principal of the Company’s capital against erosion in real value, as may be caused by inflation, while maintaining sufficient liquidity to support the Company’s operations. The Company achieves these cash management objectives by acquiring “Capital Preservation Investments,” which are reflected on PNM’s financial statements as investments in the “term deposits and short-term investments” line item. These are low-risk investments with maturity dates matching to the Company’s projected cash needs for its operations. PNM’s Capital Preservation Investments consist of timed bank deposits, certificates of deposit, or variable-rate wealth management products and structured deposits issued by commercial banks and other financial institutions, all of which have original maturity dates of less than one year.1 None of the Company’s Capital Preservation Investments are made for speculative purposes. The focus is solely to maintain the real value of the Company’s capital in the current inflationary environment.

  Applicable Legal Standards

  The Investment Company Act contains two primary tests for identifying an investment company, both of which must be considered independently.

  The Company could be deemed an investment company under Section 3(a)(1)(A) if it is, or holds itself out as being, engaged primarily, or proposes to engage primarily, in the business of investing, reinvesting or trading in securities.

  1.Notwithstanding the Company’s intention that such Capital Preservation Investments be limited to products with original maturity dates of less than one year, the Company has made a single investment with a 13 month original maturity date as Capital Preservation Investment. This was an anomalous, one off investment that the Company still considers a Capital Preservation Investment given its risk profile, the management’s intention at the time of making such investment. The Company does not intend to acquire investments with original maturity dates of one year or more in the future, or, if it does, it will treat such investments as investment securities that are not Capital Preservation Investments.

    Simpson Thacher & Bartlett

     September 8, 2023

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    Division of Corporation Finance

U.S. Securities and Exchange Commission

  Alternatively, the Company could be deemed an investment company under Section 3(a)(1)(C) if it is engaged in, or proposes to engage in, the business of investing, reinvesting or trading in securities and owns, or proposes to acquire, “investment securities” having a value exceeding 40% of the value of its total assets (exclusive of cash items and government securities) on an unconsolidated basis.

  Sections 3(b) and 3(c) of the Investment Company Act, as well as certain rules promulgated under these and other provisions of the Investment Company Act, provide certain exclusions or exceptions from the foregoing definitions. Notably, Section 3(b)(1) contains one of the many statutory exceptions to the definition of “investment company.” That section states that, notwithstanding Section 3(a)(1)(C), “[a]ny issuer primarily engaged, directly or through a wholly-owned subsidiary or subsidiaries, in a business or businesses other than that of investing, reinvesting, owning, holding, or trading in securities” is not an investment company within the meaning of the Investment Company Act.

  Whether an issuer is engaged primarily in the “business of investing, reinvesting, or trading in securities” under Section 3(a)(1)(A) or is primarily engaged in a “business or businesses other than that of investing, reinvesting, owning, holding, or trading in securities” under Section 3(b)(1) is in each case largely a factual question whose answer depends upon the actual business activities of the issuer.2 The primary test to determine whether an issuer is “primarily engaged” in a business for purposes of Section 3(a)(1)(A) and Section 3(b)(1) is the five-factor analysis described in Tonopah (the “Tonopah Factors”), with an emphasis on how a reasonable investor would view the issuer when considering the totality of such factors.3 The Company believes that an analysis of each of these factors demonstrates that the Company does not fall within the definition of an investment company under Section 3(a)(1)(A) and that it is able to rely on Section 3(b)(1), separate and apart from the analysis of the Company under Section 3(a)(1)(C).

  2.See M.A. Hanna Co., Investment Company Act Release No. 265, 10 S.E.C. 581, 583 (Nov. 25, 1941); see also SEC v. Fifth Ave. Coach Lines, Inc., 289 F. Supp. 3, 28 (S.D.N.Y. 1968), aff’d, 435 F.2d 510 (2d Cir. 1970).

  3.See Tonopah Mining Corp. of Nevada, 26 S.E.C. 426 (1947) (hereinafter “Tonopah”). See also, SEC v. National Presto Industries, Inc., 486 F.3d 305 (7th Cir. 2007) (hereinafter “Presto”) and SEC v. Fifth Avenue Coach Lines Inc., 435 F.2d 510 (2d Cir. 1970) (hereinafter “Fifth Avenue Coach Lines”).

    Simpson Thacher & Bartlett

     September 8, 2023

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    Division of Corporation Finance

U.S. Securities and Exchange Commission

  Tonopah Factor Analysis

  The Company’s Historical Development

  PNM was incorporated in the Cayman Islands on November 22, 2007 by a subsidiary of Phoenix Media Investment (Holdings) Limited (“Phoenix TV”).

  PNM originated as, and remains today, a subsidiary of Phoenix TV, a Chinese-language TV network based in Hong Kong that broadcasts within China and globally. PNM is the website and digital media face of Phoenix TV. In November 2005, Mr. Shuang Liu, a vice president of Phoenix TV, was appointed to lead Phoenix TV’s new media business. Upon his appointment, Mr. Liu began implementing his vision to transform the business from a mere corporate website of Phoenix TV into a digital new media company capitalizing on the future of new media convergence. In July 2007, traffic of phoenixtv.com and phoenixtv.com.cn were redirected to the domain name ifeng.com registered by one of the Company’s VIEs.

  The brand of “ifeng.com” rapidly achieved prominence among Chinese Internet users. It was recognized as the “Most Valuable Chinese Internet Brand” at the Chinese Internet Advertisers Annual Convention in October 2010. By March 2011, the ifeng.com website ranked number one in terms of page views among the world’s leading TV companies’ websites, edging out CNN.com, BBC.co.uk, and CNTV.cn, according to Alexa.com.

  On May 12, 2011, the Company’s American depository shares (“ADSs”) began trading on the New York Stock Exchange under the ticker symbol “FENG.” The Company’s choice of ticker clearly signified to investors that the focus and core of the Company was its digital media platform.

  These facts show that the purpose for which the Company was incorporated was to be the digital media arm of Phoenix TV, which is not a securities-related activity. Moreover, the Company’s development has remained consistent with its founding intent and mission through to present day.

  The Company’s Public Representations Concerning its Activities

  In its public representations and statements, including on an enterprise-wide basis and through the activities of its subsidiaries and parent organization, the Company presents itself to the public as a holding company that is primarily engaged in the digital new media business through its subsidiaries. For example, in the Annual Report the Company describes itself as “a leading new media company providing premium content on an integrated Internet platform, including PC and mobile, in China.”4 The Company’s Annual Report and other public representations overwhelmingly focus on its core digital media business and the plans to grow that business.

  4.Annual Report at 58.

    Simpson Thacher & Bartlett

     September 8, 2023

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    Division of Corporation Finance

U.S. Securities and Exchange Commission

  When investments are mentioned, it is generally in the context of explaining how they will be used to expand the Company’s core business activities. For example, in the Annual Report, the Company discloses that “as part of [the Company’s] business strategy, [the Company] intend[s] to identify and acquire assets, technologies and businesses that are complementary to [its] business.”5 This type of additive investment strategy is consistent with the Company’s view that it is primarily engaged in a non-investment company business.

  The Company acknowledges that the Annual Report does reflect the Company’s current belief that it would be deemed to be a passive foreign investment company (“PFIC”) for United States federal income tax purposes, but respectfully submits that such an acknowledgement is not the same as the Company holding itself out to investors as being primarily engaged in a securities business under Section 3(a)(1)(A). The PFIC disclosure is merely a statement of the Company’s current status for United States federal income tax purposes and should not be construed as a statement of policy or intention. The Company made this clear by the disclaimers embedded in the PFIC disclosure which note “the determination of whether [the Company is] a PFIC is made on an annual basis and will depend on the composition of [the Company’s] income and assets from time to time.”6

  Moreover, the PFIC disclosure should be understood as a statement communicating the results of a tax analysis that is driven by an analysis of the Company’s assets and income exclusively, and any statement regarding just those two factors cannot be dispositive as to whether the Company is an investment company under Section 3(a)(1)(A) or Section 3(b)(1) of the Investment Company Act. As noted in the Company’s disclosure on this point, “[the Company] will be classified as a PFIC for United States federal income tax purposes for any taxable year in which: (i) at least 75% of our gross income is passive income, or (ii) at least 50% of the value (generally determined based on a quarterly average) of our assets is attributable to assets that produce or are held for the production of passive income.”7 Analysis of the Company’s assets and income, however, corresponds to just two of five of the Tonopah Factors. While historically the SEC and the SEC staff have emphasized those two factors when performing an analysis under Tonopah, in Presto the United States Court of Appeals for the Seventh Circuit made it clear that Section 3(b)(1) cannot merely be reduced down to yet another set of numerical tests.8 Therefore, based on Presto, it appears the first three Tonopah Factors are of at least equal importance to the last two factors and the five factors in their totality must be assessed in a holistic manner. “What principally matters is the beliefs the company is likely to induce in investors. Will its portfolio and activities lead investors to treat