Chinese gaming company Tencent’s push towards dominance in the entertainment industry is worth looking at. The Shenzhen holding is the world’s largest video game company whose tentacles stretch to social networks, music, web portals and information, e-commerce, internet services, and payment systems. In this article, we cover this peculiar holding’s interest in the gaming world in the present, as well as the plot to take over a major French video game company.
Tencent’s vast array of companies —over 300— reaches far and wide, from Riot Games’ “League of Legends”, one of the most popular PC games worldwide to the gaming platform Epic Games, who hosts Fortnite, Red Dead Redemption, and the Borderlands series. The Shenzhen firm has a presence in companies like Bluehole, known for the popular PUBG, and owns WeBank, the pioneer online-only bank in the People’s Republic of China.
Tencent goes West
Having acquired a massive 700USD million deal with the National Basketball Association for streaming rights, Tencent has the incredible opportunity to offer the best features of basketball a market of more than 1.4 billion people. The distribution and consumer branch of the company reached deals with French retail giant Carrefour’s operation in Mainland China. The wide array of activities of the company also boasted a significant interest in France as a gateway to the West.
Chinese companies buy with enormous interest stakes in companies that invest in entertainment, Tencent is a cardinal example of how the People’s Republic of China gains influence throughout the West, the company managed to come to the aid of French video game giant Ubisoft’s hostile takeover from rival company Vivendi.
Vivendi owns a stake in a group of entertainment companies like the Universal Music Group, the Canal+ group, and Gameloft. Gameloft tried to buy Ubisoft, triggering a brief and intense legal tug-of-war that ended up with Vivendi’s video game stake acquisition by none other than Tencent. Whose intentions to put Ubisoft’s games in the Mainland China market —the largest in the world— are on hold as they reach a deal. Tencent’s stake in Blizzard Entertainment puts the long-running awarded series World of Warcraft and major titles like Diablo and Overwatch 2 in the Chinese market, whose number of gamers surpasses the number of American citizens.
Tencent’s position in China
The company joins Apple, Amazon, and Facebook in the podium of companies that pass the 500 million dollar market capitalization value, which makes the Shenzhen based archipelago of companies the first company in Asia to reach that prestigious position. Tencent ranks fifth as the most significant internet provider on the planet.
Tencent’s 69 billion US dollars empire also owns a significant part of WeChat—Weixi—, China’s largest chat app who’s also the target —along with ByteDance’s TikTok— of the latest push of Donald Trump’s trade commerce feud with the Asian nation.
With nearly a billion WeChat users, Tencent is China’s dominant player in the everyday communications of a large segment of the Chinese population. This feature puts them in the radar of Chinese authorities, whose relations with the private sector of telecommunications puts them in the eye of Western regulators.