In his home country, Tencent is looking to increase the revenues of its video games business. The Chinese group negotiates with mobile giants Oppo, Xiaomi, Vivo, Lenovo …
The name Tencent may not tell you much, and yet it’s one of the biggest names in mobile video gaming in the world. As the majority shareholder of Supercell (Clash of Clans, Clash Royale) and Riot Games (League of Legends), the Chinese company also operates the hugely popular WeChat messaging. And after seeing its revenue growth for many years, the Gaming division of the giant is experiencing a delicate phase. To improve the situation, the group launched negotiations with the various players in the mobile world.
70/30 rather than 50/50
As Bloomberg explains, Tencent is currently in discussion with Oppo, Lenovo, and Xiaomi among others to get a bigger slice of the cake in the sale of its games. Because yes, in China it is the manufacturers of smartphones that offer their own app stores since the Google Play Store is not available. Tencent is nevertheless inspired by the model of Google and Apple since it seeks to get 70% of the proceeds from the sale of a game against 50% today.
And it could well be that the company is successful because the climate is rather promising. The Chinese government’s control over gaming, which dropped Tencent last year, effectively reduced the number of titles available on the app stores, giving the group more negotiating power. Or how to turn a government regulation into a weapon. The absence of two new games in the group (JX Online 3 and Crazyracing Kartrider) shows that the discussions are still ongoing. A giant battle.