Tencent Focuses On Streaming Platform After Merger Blocked

    • Tencent is allocating resources toward its own game streaming platform.
    • This follows a merger blocked by China's antitrust regulator.

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Tencent is building its own game streaming platform after its merger of China’s two most popular video game streaming sites — Huya and DouYu — was blocked by China’s antitrust regulator, according to Bloomberg. 

Tencent is battling both antitrust concerns and new restrictions in China on the amount of time children can play video games — a max of only three hours most weeks. 

As a result, the company, which counts value-added services — video games, online advertising, and social networks — as a third of its revenue, saw its stock drop 1.03% by market close on Monday.

Despite the inability to merge the platforms, Tencent continues to expand its offerings. 

  • It signed a three-year deal in April with Major League Baseball to broadcast in Asia. 
  • The company inked a multiyear distribution deal with Sony Music in May. 
  • It took a majority stake in Berlin-based game maker Yager in June. 
  • Last month, it acquired British gaming company Sumo Group for $1.27 billion. 

The company generated $21.5 billion in revenue in Q2 2021, a 20% increase year-over-year. 

The value-added services segment (video games, online advertising, and social networks) brought in $11.1 billion in Q2 revenue, up 11% from the same period a year prior.