Human survival and development are inseparable from air, water and energy. Tencent’s development is mainly driven by social, games and video. Recently, Tencent’s most important growth engine — the game business growth is slow, the overall impact of the game business downturn, Tencent’s market value has been “continuous decline”; The agency’s Monster Hunter: World was pulled on August 13, which was dubbed “the darkest day in the history of Chinese gaming” by players.
Tencent game: brilliant behind difficult pathological mask
Tencent, once worth more than $500 billion, was once Asia’s largest publicly traded technology company. But physical function gradually declines in middle age, and Tencent seems to be facing a midlife crisis today.
First, the gaming business is slowing. According to Tencent’s first-quarter earnings report released on May 16, 2018, its total revenue in the first quarter was 73.528 billion yuan, up 48% from the same period last year. But game growth was only 26%, slower than 40%, and a UBS report in July estimated that Tencent’s mobile and PC game revenue fell 9% quarter-on-quarter in the second quarter (expected to be flat and down 5%), indicating a significant slowdown in game growth.
Second, the game business is uneven and lacks new growth poles. Tencent’s business is mainly divided into game business, social business, pan-entertainment business and cloud service sector, of which game business accounts for more than 40%. The main strength of Tencent’s games is only online games and mobile games, while the single-player games are weak and the development of game business is uneven. When online games and mobile games are about to hit the ceiling, the growth is increasingly weak.
Three major faults sent Tencent game lost driving force
Tencent can grow from zero to 500 billion DOLLARS in 16 years of market value is inseparable from the game, Tencent’s game business is the engine of the company, but frequent failures, difficult to start, what is the reason behind?
Tencent game business structure is not reasonable. Gaming and social networking have always been the twin swords of Tencent. Tencent attaches so much importance to games and social networking because games can bring more profits and social networking can bring more traffic to Tencent, which also confirms Tencent’s strategy of “capital + traffic”. In the game business, mobile games and PC online games are the main sources of Tencent’s game revenue and are the focus of development. The unreasonable structure of game business leads to the slow growth of the overall game business in the context of the increasingly saturated PC online game and mobile game markets.
Lack of new “universal” games. When it comes to Tencent games, before 2017, the only three games that people could think of off the top of their head were League of Legends, Dungeons & Warriors and CrossFire. In 2018, There was only one more Tencent game worthy of national title, Honor of Kings. It is a pity that people love new things and hate old things. Up to now, there has not been a new “national level” game in Tencent games, resulting in the lack of explosive games to drive a greater growth of Tencent games.
Competition in the segmented game market intensifies. Tencent game in the subdivided market although have layout, such as investment in the women’s game market skins “miracle”, the function of the game in the field of the shaman, mountain and secondary yuan game “saint seiya” in the field of mobile game, but tencent in the gaming segment does not have the advantage, the more deadly is not only more of the small and medium-sized companies into the game market segment, Netease and other giants also joined the competition, making the competition in the game segment more intense, reducing the role of the game segment in promoting Tencent’s game growth.
If monster hunter is not removed, Tencent can save a city
Tencent is also aware of the root cause of the slow development of Tencent games, coupled with the fierce competition in other segments of the game field, PC PC games as the next growth point, seeking to change the current unfavorable situation. Monster Hunter: World has received a good response on the console platform, which is an important reason for Tencent to actively introduce the game to China. Tencent finally got the right to launch the game through various channels, which was released two days earlier than Steam, taking the lead in the layout of PC PC game market. If Monster Hunter: World is a big success on Tencent’s WeGame platform, Tencent will benefit from two aspects.
First, it expands the impact of the WeGame platform. WeGame game platform is an important springboard for Tencent to enter the PC game market, but blocked in the PC game market not only Origin, Blizzard battle.net and other well-known game platforms, but also the Steam game platform. Monster Hunter: World was released on both WeGame and Steam, but Tencent managed to steal the game’s first release, two days ahead of Steam, with an advantage in price and a solution to the problem of frequent disconnection, sending the game’s rating soaring to 9.3. This series of actions not only greatly improved the impression of WeGame platform among Chinese players, but also expanded the influence of WeGame platform.
Second, pave the way to enter the PC market, stimulate the company’s profit growth. Due to the slow growth of game business, Tencent’s market value has been severely vaporized, and it is in urgent need to stimulate the profit growth of the company with the rapid growth of game business, while the PC PC game market has always been a weak part of Tencent. If Monster Hunter: A good reception for World on WeGame could pave the way for Tencent to make a big push into PC PC games. It could also boost Tencent’s business and indirectly boost its profits.
Monster hunter was off the shelves so Tencent injuries
However, monster Hunter: World was removed from the app store after only a few days due to a large number of player reports, which had a big impact on Tencent.
In the PC market, Steam has always been the dominant game platform, and Tencent’s attempt to enter the PC market could not escape the competition with Steam. Therefore, Tencent cooperated with Capcom to launch Monster Hunter: World PC, but as the only aaa blockbuster on WeGame platform, Monster Hunter: World was also pulled, leaving The WeGame platform with no players to compete with on Steam.
If you want to do good things, you must first sharpen its tools, Tencent to enter the PC game market to get through its channels, and “Monster Hunter: The World” is Tencent to get through the PC game market, but “Monster Hunter: The removal of World has robbed Tencent of its key tool to break through the console game market. While it won’t stop Tencent from entering the console game market, it will at least slow down Tencent’s steps to enter the console game market.
The removal of Monster Hunter: World from WeGame platform not only missed Tencent’s opportunity to enter the console game market, but also caused Tencent to lose 70 billion yuan in market value in the next day.
Think over the pain, Tencent game in which direction
What is done cannot be undone. There is nothing to be done to mend who is behind the operation of this incident. Only by thinking over the pain can we reduce the loss as far as possible, avoid the recurrence of such incidents and improve the current unfavorable situation.
Adjust game structure and game development strategy. As adversity leads to change, Tencent’s current game structure is not reasonable, so it needs to adjust its game structure and find new growth poles. As one of the troika of stand-alone game development is very backward, natural need to increase the development of the game business new growth pole. The development of PC single player games can be introduced and research and development of PC single player games two ways to inject new vitality into the development of Tencent games.
On the one hand, the introduction of foreign PC games should be fully combined with the actual situation of the domestic, not only to introduce which good reputation of the masterpiece, but also to introduce in line with the core values of the society and the relevant laws of high quality games. In terms of game content, we will strictly review and eliminate content that violates laws and regulations and social core values, so as to provide a good game environment and correct value orientation for players. One success story is games like Minecraft, which has brought 30 million users to netease, helped the development of feature games in China and provided the right value orientation for young players. In the meantime, avoid a repeat of the monster Hunter: World summer.
On the other hand, in the research and development of PC PC game should not forget the original aspiration, adhere to the spirit of craftsmen and talent mining. First, the development of console games requires Tencent to adhere to the original intention of creating happiness by heart, so as to develop foreign masterpieces like Monster Hunter: World; Secondly, when developing games, we should not aim too high. We can first accumulate experience by imitating high-quality stand-alone games or developing small and medium-sized stand-alone games to develop large-scale stand-alone games and grow slowly. Finally, it is to solve the problem of talents. Talents are the main body of creation. Tencent needs to introduce more excellent developers to provide hardware guarantee for the development of PC single-player games by training game development talents and using high-tech welfare strategies.
In addition, it can continue to cooperate with world-class game developers to develop games. Although Tencent has made some attempts in this aspect, for example, on August 31 this year, Tencent and SE announced the establishment of a joint venture company, and the two sides cooperate to develop 3A games. Although this has not achieved results, this way is feasible. 1+1 is greater than 2. SE is good at game development, while Tencent is better at game operation. The cooperation between Tencent and such manufacturers as SE is conducive to making up for Tencent’s lack of game development ability and promoting the healthy development of Tencent’s game business.
summary
Tencent company today are faced with the dilemma is due to the long term is highly dependent on the result of the game, but what the result is not going to adjust business, which requires tencent will single PC game pulled into tencent business development of the third carriage, such not only can alleviate the dilemma of the company, also can promote China’s LAN game and even the whole China game industry development.
Article/Liu Kuang public number, ID: Liukuang110, this article first kuang Venture capital network