A new report has detailed that Tencent might be looking to partner with Meta to provide future virtual reality plans in China.
After backtracking on plans surrounding the metaverse and virtual reality, Tencent appears to be making a move in familiar territory.
The Chinese firm recently culled plans surrounding XR through layoffs and pulling out of providing their own hardware. It was reported that this is due to recent economic issues and a lack of profitability for the company until 2027.
Now, it appears that Tencent might be trying to repeat what they did for the Nintendo Switch in China. The current deal between Nintendo and Tencent is that the Chinese side of the company deals with distribution.
This includes putting games through China’s regulatory body and providing services within its firewall. Nintendo then does the extra legwork to ensure games are localized.
Facebook and Tencent partnering on VR?
Tencent is presumably looking to replicate this with Meta. The deal would allegedly include handling everything on the Chinese side of things for Meta, while also allowing the hardware to be actively sold in a country that has the company’s main outlet, Facebook, banned.
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The report comes from 36 Krypton, an industry outlet from China.
As of right now, one of Tencent’s major competitors, Bytedance – the owner of TikTok – is also undergoing corporate restructuring around their VR division. In the same reports that came out about Tencent’s reduction in plans around XR, Bytedance had let go of a reported 200 people in their Pico division.
The Pico 4 is a direct competitor to the Meta Quest 2, providing a decent alternative to the hardware. However, the Pico 4 has less software and support in the VR space than the Meta Quest 2. Bringing established hardware into the East would skip a lot of headaches.
Meta would presumably welcome the investment and overseas cooperation, as the company has lost a reported $700 billion in market value since pivoting to the metaverse and VR experiences as a focus.