Tencent is a Chinese internet giant and the most valuable Chinese company on the market. Founded in 1998, Tencent offers integrated internet solutions to over 1 billion netizens.
Its core business operates through social platforms and digital content, providing services to facilitate communication and foster closer relationships among consumers. It also invests in games, music and comic books.
Founded in 1998
Tencent is a Chinese multinational company that provides internet-related services and products to users around the world. It founded in 1998 by software engineer Pony Ma Huateng, who spotted an opportunity in the rapidly growing internet industry in China. The company started out in instant messaging and has grown to include a variety of online gaming, social networking, search engine, e-commerce, mobile application and financial technology businesses.
Tencent’s main source of revenue is through its value-added services, or VAS, model. These are services that can be use to pay for additional features and functions on Tencent’s social media, gaming platforms and mobile games. For example, a player can buy a special weapon or costume for their avatar in a game.
Another source of revenue is advertising, which includes both organic and paid for ads on its social media and gaming platforms. Its revenue also derived from virtual goods sales, which include things like virtual money and other in-game items.
Although Tencent is well known for its gaming operations, it also has an extensive investment portfolio outside China. It owns California-based Riot Games (the creator of League of Legends), Finnish Supercell, and is a heavy investor in major games firms such as Epic Games, Activision Blizzard, and Ubisoft.
The company’s investments also cover a wide range of industries, including artificial intelligence, retail, education, financial technology and corporate services. Its current investment portfolio includes more than 800 firms, many of which are familiar Western names such as Tesla, Snapchat, Spotify and Universal Music Group.
A large portion of Tencent’s investment portfolio is in the digital content sector, which consists of content providers and distributors that distribute their content on their own websites or on a third-party platform, such as YouTube or Facebook. Its other investments include film production and distribution, copyright licensing and merchandise sales related to its core entertainment business.
Tencent has a strong presence in China, where it is the dominant provider of WeChat, a popular social network with over 1 billion monthly active users. WeChat is a highly effective tool for communication and marketing and serves as an essential part of Tencent’s overall brand strategy in the country.
Listed on the Hong Kong Stock Exchange in 2004
Tencent is one of the world’s largest Internet companies. Its operations encompass communications and social services, online gaming, digital content platforms, and a range of Internet value-added services for enterprise clients.
The company’s market cap has risen to HK$3.99 trillion, putting it in the ranks of the world’s top tech firms like Apple and Alphabet. It is also one of the few Chinese firms that has a global presence.
Founded in 1998, Tencent is a technology and Internet services powerhouse with a diverse portfolio that includes internet social networking, gaming, advertising and FinTech. The company’s share price has soared over the years, thanks to its continued revenue growth, massive user base and investments into new areas.
Its most popular product is WeChat, a messaging service that now has more than 1 billion users. Its online and mobile games division brings in more than $4 billion per quarter. The company is also a major player in video and cloud computing, as well as artificial intelligence.
Since its debut on the Hong Kong stock market in 2004, Tencent has grown its market cap to HK$3.99 trillion, a feat that would consider impossible in many other countries. It has also become a major force in China’s rapidly growing technology industry, as its executives have helped spearhead the development of technologies that can improve real-world applications.
The company is also a leading investor in private and public businesses. It makes minority investments in these companies with the aim of helping them grow until they become publicly listed.
To date, Tencent has invested in numerous companies in the e-commerce, entertainment and gaming sectors. It has also made several strategic acquisitions.
For example, in 2015, it acquired Finnish smartphone game maker Supercell for $11 billion. In addition, the firm is a minority investor in Epic Games, maker of the popular game Fortnite.
This investment is a great way to invest in a global company that has a deep understanding of the Chinese market and the ability to innovate. The investment can made directly by buying shares or through a fund that has exposure to Tencent.
Tencent invests in games
The world’s largest gaming company, Tencent, is investing in a record 62 game studios this year. That’s twice as many as it did in 2020, and five times more than in 2019.
While China’s gaming market has been under pressure due to tighter regulation, Tencent is betting on global markets to boost its revenues. As a result, it’s focusing on foreign games makers rather than its homegrown mobile business.
Tencent has stakes in Riot Games, Remedy Studios (known for Max Payne), Bohemia Interactive, Digital Extremes, Sumo Digital, Warframe developer Digital Extremes and PUBG publisher Krafton. In addition, it owns 100 percent of a handful of smaller developers including Funcom and Sharkmob.
In the past, Tencent has also invested in American-based companies such as Epic Games and Activision Blizzard. These deals have helped the companies to expand their global reach and launch new titles in other markets.
For instance, Epic Games’ 2013 eSports-focused League of Legends launched to a much larger audience after it worked with Tencent on the game’s launch. The deal also gave the games maker some valuable experience operating live-service games, as it was able to work with Tencent’s team of experienced operators and marketing experts to improve its business model.
Meanwhile, Tencent has helped Ubisoft bring its most popular franchises to China and the rest of Asia, a process that began with an investment in the French firm’s parent company, Guillemot Bros, back in 2016.
Analysts say Tencent’s focus on outside games investments is a strategic move as it looks to grow beyond China, where it faces a number of challenges, including restrictions from the government. The Chinese company has also backed smaller games in other parts of the world such as Japan, India and Southeast Asia.
The company’s strategy has been a success so far. It is now a major player in the worldwide video game market, and the Shenzhen-based tech giant plans to increase its global operations and diversify into other areas such as gaming and healthcare technology.
In addition to its global games division, Tencent owns a number of social media companies and entertainment platforms. Its QQ instant messaging service has been a hit in China, and it also produces music and TV shows. It’s a leader in online shopping and is also building a large medical technology business.
Tencent invests in music
Tencent is one of the world’s biggest technology investors and also a major player in the online music industry. It has invested in music label Spotify and has a portfolio of music-related apps and services, including QQ Music, Kugou Music, Kuwo Music and WeSing.
The company has a large user base in China, with over 700 million monthly users and 15 million paying subscribers. It provides its users with a variety of apps, enabling them to stream music, watch live performances and play karaoke.
In the United States, Tencent owns a stake in Warner Music Group and has invested in streaming service Spotify through its subsidiary, Tencent Music Entertainment. However, the company’s long-term ambition largely centered in China.
This is because it has a large presence in the country, and aims to take advantage of its vast network of users and their access to smartphones. It is currently the leading online music service in the country, and has over 75% market share.
But the company’s long-term ambition isn’t simply to become a Chinese equivalent of Spotify; it wants to use its music label to expand into other markets around the world. Last week, it made two significant investments in music companies that are based outside of China.
First, it bought a 10% stake in WMG and a further 10% in Warner Music Group through its subsidiary Huang River Investment Limited. The moves come after WMG’s IPO, and are part of a reciprocal arrangement that could help boost both companies’ prospects for growth in key markets.
Next, it invested in Culver City-based virtual concert production startup Wave. Wave will be able to use Tencent Music Entertainment’s platforms, including its music-centric live streaming app TME Live, to air its virtual concerts in China.
It also invested in music-based video game developer Cue Ball Group and the startup Pex, which monitors social networks to weed out copyrighted content. The Los Angeles-based company claims it can identify “snippets as short as 1 second” across dozens of platforms worldwide.
Tencent’s investments in music are a reflection of its belief that the online music industry has returned to health. After years of piracy, the company believes that paid streaming services have regained control over the market and are now a more reliable source of revenue than free services.
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