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Steam accounts for 3 of the top 10 new games in the new year. Is the presence of Tencent’s overseas legion getting stronger and stronger?

GameLook report/Not long after the beginning of this year, ” Phantom Beast Parlu” was born on the Steam platform”, “Mistlock Kingdom” and many other popular products. Taking this opportunity, GameLook also conducted statistics on the most popular products among players this year.

You won’t know it if you don’t watch it, but you will be shocked when you see it – GameLook unexpectedly discovered that in addition to the phenomenal “Phantom Parlu” which far surpasses other products, the number of people online at the same time at the peak ( PCCU) Among the top ten new games of 2024, Tencent is behind 3 products.

Among them, the eighth-ranked open-world survival and construction game “Legend of Nightingale” was developed by the Canadian studio Inflexion Games. This studio was fully acquired by Tencent in early 2022. It can be said that it has long been included in the ranks of “self-developed studios” . Inflexion Games CEO Aaryn Flynn was also interviewed at the beginning of the month, praising the cooperative relationship with Tencent as “very relaxed and fully supportive” and “Tencent is probably the company with the most long-term vision we have ever seen.”

Tencent invests in Keen Games’ “Mistlock Kingdom” to achieve 160,000 online sales on Steam

The developers of “Last Epoch” and “Mistlock Kingdom” ranked third and fourth, Eleventh Hour and Keen Games have both received investment from Tencent. According to developer Eleventh Hour, Tencent holds a minority stake, and Tencent and Hiro Capital jointly invested $10 million in Keen Games.

As we all know, Tencent has always been regarded as a “big player in online games and mobile games.” But in the PC and console markets, which are considered the main stage for overseas manufacturers, the seemingly “obscure” Tencent Games has seen its presence grow rapidly in recent years.

For example, in last year’s TGA, there was even a bizarre scene where “Tencent-based companies accounted for half of the country’s games.” A local financial information shows that the 2023 Game of the Year winner ” Baldur’s Gate 3″The Larian Studio behind “Baldur’s Gate 3” is 30% owned by Tencent, which is the company’s major shareholder. So far, the sales volume of “Baldur’s Gate 3” has exceeded 10 million units.

In addition, “Alan Alan 2” (Remedy Studio), which won eight TGA nominations last year, “Armored Core 6” (FromSoftware), the best action game winner, and “League of Legends” and “Fearless Contract” which won all e-sports awards (Rist), the companies behind it have received investment from Tencent, or are studios owned by Tencent.

The list of companies Tencent has acquired is far more than this: it acquired Sumo Group for US$1.27 billion and fully acquired Sharkmob , the developer of “Warhammer 40k: Undertow”, invested US$1.6 billion in shares (third-party estimated data) and became the largest shareholder of Techland, the developer of “Dying Light”; acquired Digital Extremes, the Canadian developer of “Warframe” for more than US$1.4 billion, and invested in the production of “Forza Horizon” before Gavin Raeburn’s new studio… So much so that the number of people in overseas studios currently wholly owned by Tencent exceeded 4,000 as early as last year.

It can be seen that Tencent’s investment style in the overseas console and PC fields in the Western market is “stable and ruthless”: the game companies it currently acquires either have strong development resumes or are led by solid producers. “3A” and “high quality” have become the primary keywords for Tencent’s acquisitions. In order to obtain powerful developers, Tencent is not willing to pay tens of billions of yuan in capital costs.

The acquisition or investment of a single PC/console game studio can easily cost 10 billion yuan. If placed in the Chinese market, it can support the development of more than 10 “Genshin Impact” games. Considering the long cycle and rate of return of console/PC games, How this economic account can be calculated and still make Tencent feel worthwhile is quite curious to GameLook.

As Tencent’s overseas game products continue to emerge, how can these games close the Internet and form a strong overseas ecosystem comparable to Microsoft, Sony, and Nintendo? Tencent is still making big moves.

With 30 million daily active users, will the Epic store be a good place to close the Internet?

Tencent has always had a good reputation of being “free range” in the studios it acquires. However, judging by normal business logic, Tencent’s large-scale overseas investment with tens of billions of funds must not only be for the purpose of obtaining share dividends from game manufacturers and incubating IP opportunities to adapt mobile games. This giant that pursues long-termism in the game business is indeed quite patient, but at some point in the future when “everything is ready”, Tencent may also seek to revitalize its product lineup.

And when this moment comes, how will Tencent bring the product to fruition? GameLook wants to take a wild guess.

For example, the Epic Games Store is a possible place. Currently, Tencent still holds 40% of Epic shares, and is only one step away from becoming the largest shareholder. Judging from the current scale of the EGS store, this game store is not as good as Steam, which is also a PC platform, but it has maintained a steady growth trend in the past few years.

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According to the latest annual review released by Epic, there are currently more than 270 million PC users in the Epic Game Mall, an increase of 40 million from 2022, and the total number of Epic cross-platform accounts has reached 804 million. In 2023, the number of daily active users of the Epic Game Mall will reach a peak of 36.1 million, and the number of monthly active users will reach 75 million, up from 68 million last year.

In 2023, more than 1,300 new PC games will be launched on the Epic Games Store, and the platform currently has more than 2,900 games, an increase of 88% since 2022. Including Epic’s own games, players spent more than $950 million on the Epic Games Store in 2023, a 16% increase from 2022.

Epic Games Store also has several unique advantages. For example, the company is currently preparing to launch an app store for mobile platforms. Although this move is mainly in response to Apple’s opening of third-party iOS store licenses in the EU, Epic still has the opportunity to make it a big business across the world.

The EGS store has accomplished something that Tencent has not accomplished in the Chinese market, especially its cooperation with NetEase and MiHoYo.

At present, Chinese and foreign manufacturers are dancing harmoniously in the Epic Game Mall – according to the latest annual review, Chinese products such as “Genshin Impact” and “Honkai Impact: Star Rail” are competing with “Red Dead Redemption 2”, “Cyberpunk 2077”, etc. Overseas games are jointly at the top of the revenue rankings. Games such as “Black Myth: Wukong” and “Zero” have become the “most anticipated games” officially listed by Epic.

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Not to mention, relying on its free game distribution strategy and sincere content sharing, Epic Game Mall has also accumulated high popularity in China – not only does the official account have millions of fans on platforms such as Bilibili, but it also gains revenue from players. It was nicknamed “E Bao” and has a unique reputation.

In a sense, in terms of global market influence, Epic GamesIt even completely surpasses Tencent’s own WeGame platform. We can fully imagine that one day, a well-equipped Tencent will expand its shareholding ratio in Epic Games, help it expand its PC and mobile business, and integrate Tencent’s major games such as “League of Legends” and “Fearless Contract” Products are distributed through Epic. In this process, Tencent will also become an “important force” in the gaming industry.

Surrounding the global gaming industry, what is Tencent doing?

Globalization has only started for a few years, and Tencent still has the image of a “big owner”. But if the cycle is extended to ten or twenty years, under the catalysis of time, these acquired studios may not only play the role of “new force” and “money printing machine” for Tencent’s development, they will also be more important. It may have a significant impact on Tencent’s gaming capabilities and business direction. According to GameLook, the acquisitions of these studios by Tencent carry at least three levels of important strategic significance.

First of all, by acquiring and participating in the international game publishing business, Tencent will be able to build a better understanding of overseas markets and then expand its global self-developed and all-round system. In 2022, Liu Ming, CEO of Tencent Interactive Entertainment’s international business, was interviewed by foreign media and conveyed this goal: “We are exploring our expertise around the world, and we have various expertise and capabilities for local online operations around the world. Now, What we’re trying to do is build out our global distribution system, and we want (our regional teams) to be publishers, not just local market agents.”

This strategy is already bearing fruit. For example, Tencent’s Level Infinite has rapidly become the world’s leading cross-terminal distribution brand in recent years, relying on the capabilities and exploration accumulated from the international distribution of products such as “Warhammer 40k” and “Nikke”. In the recent case of Level Infinite, the brand helped “Honor of Kings” launch in more than 50 countries and regions. Relying on efficient local resources to promote the game, it achieved the good result of reaching the top of the free list in many places.

“Honor of Kings” tops Türkiye’s IOS free game download list

Another important significance is to feed back Tencent’s own game self-research capabilities. Many 3A studios that have been acquired by Tencent in the past have mentioned that the two parties will conduct two-way resource exchange. Tencent provides manufacturers with non-financial support such as cloud services and game operations, and these 3A manufacturers will also exchange game development experience with Tencent. In the eyes of Tencent, which is pursuing high-quality games and trying to enhance its self-research capabilities for game products, this is undoubtedly highly necessary.

In recent years, we can clearly feel that the development quality specifications of Tencent’s new products such as “Yuanmeng Star” and “Need for Speed: Assemblage” have been in line with leading international products, and more and more projects such as “Operation Delta” and “Need for Speed: Assemblage” have been developed. The establishment of a “big product” project with AAA-level production standards, multi-terminal and cross-platform such as “Reverse War: The Future” is undoubtedly related to the accumulation of development experience through acquisitions. Tencent Photonics unveiled its self-developed 3A product “Last Sentinel” at last year’s TGA. The LightSpeed ​​LA studio behind it was also co-founded by overseas veteran producer Steve Martin.

Tencent Photonics self-developed 3A “Last Sentinel”

Finally, for content-based industries like games, sufficiently rich content itself is enough to form a barrier to business development. Take the development of cloud gaming as a simple case comparison – Google’s cloud gaming service Stadia died midway due to a lack of game lineup; in contrast, Xbox’s Phil Spencer confirmed the day before yesterday that Xbox’s cloud gaming The proportion of service usage time has exceeded double digits, giving them the confidence to continue investing in cloud gaming construction.

We often divide the console market into three camps: Sony, Microsoft, and Nintendo. Each of the three companies has a rich lineup of game studios. As Level Infinite’s brand slogan “A new level of infinite possibilities” says, after attracting enough related manufacturers, Tencent in the future is entirely likely to become the “fourth pole” of the gaming industry. , under the moat of content, develop game services with more unique characteristics, bringing unlimited possibilities to the game industry.

Source: Nico Partners / gamelook-com-cn

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