Tencent, one of the largest game companies in the world, has recently announced the closure of its game streaming site, which had been available since 2010. This unexpected decision has sparked questions from the gaming community regarding why Tencent would shut down such a popular service.
As the Chinese technology sector continues to evolve, the company is taking a proactive approach to safeguard its customer base.
This article explores some potential reasons why Tencent has chosen to close its gaming streaming site. Firstly, we will examine how technological changes and access to content have led streaming platforms to reconsider their service delivery approach. Secondly, we will discuss how changes in business models and regulations can influence decisions like this one by Tencent. Finally, we will look at the economic implications of Tencent shutting down its streaming site, both for Tencent and for other providers in the gaming space. We hope this article helps provide insight into this puzzling move by Tencent and sheds some light on their reasons for making it.
Tencent Closes Game Streaming Site
Tencent recently shut down its game streaming site, which was used to distribute popular PC and mobile games to the Chinese market. This was done as part of Tencent’s effort to comply with regulations from the Chinese government. This article will provide an overview of Tencent’s game streaming site, its features, and the reasons behind its closure.
The Idea Behind the Site
Tencent’s game streaming site, Penguin eSports, was where gamers could play and broadcast video games for free. Unlike traditional live streaming platforms, the site does not have ads in the videos or collect any data from users. The idea behind the site was that Tencent would make money from gaming-related content and merchandise which would eventually be sold on its related shopping website, Hyper Dealin’.
Since launching in 2013, Penguin eSports has become one of the most successful game streaming sites in China with hundreds of millions of viewers subscribing to its channel. Aside from gaming streams, the site featured interviews with professional gamers and other content that moved the gaming culture beyond games and into a broader digital culture.
While there were plans to monetize the website by selling merchandise, this never materialised due to legal issues concerning intellectual property and copyright violations. Furthermore, government restrictions on Internet content meant that much of the content on Penguin eSports had to be censored or taken down entirely.
As such, Tencent had no choice but to close down its game streaming website in late 2018 due to low profits and other pressing business concerns.
Services Provided
One of China’s largest internet giants, Tencent ran a game streaming platform known as Tencent Gaming Platform. It allowed players to broadcast and watch live streams of games. It also provided various services including leaderboards, competitive tournaments and network stability testing. Through acquired companies in 2018, Tencent consolidated its game streaming services by merging its QQ platform with DouYu and Huya- two leading Chinese esports streaming platforms.
Tencent Gaming Platform offered a multilingual version in multiple countries including China, Japan, Korea and India. In June 2020, the platform was closed due to various factors such as the inability to properly monitor the content being streamed on the service. There were increasing reports of exploited gameplay mechanics and resultant gaming experience degradation. Other problems that led to the closure include censorship issues due to strict regulations regarding inappropriate content and illegal transactions on the platform.
Tencent also faced scrutiny from gamers and media outlets regarding cheating allegations that eroded consumer trust in their service offerings. In addition, Tencent faced heightened competition from various domestic rivals including Bilibili Cloud Gaming, ParaPara Live Esports plus Vertigo Game Streaming which provided a more expansive line of gaming supports exclusive for chinese gamers allowing them to follow global trend akin to Google’s Stadia or Amazon’s twitch for example. Hence this serves as a contributing factor for Tencent’s decision towards closure of its gaming streaming site services provided through its subsidiary management earlier on this year due interrelated reasons listed above
Reasons for The Closure
On January 18, 2021, Tencent announced that it would be closing its game streaming site. This surprised many gamers who were previously avid users of the platform, and it has sparked a lot of speculation as to why Tencent decided to make this decision.
In this article, we’ll explore some potential reasons that might have led to the closure of Tencent’s game streaming site.
Lack of Popularity
Why Tencent decided to close down one of China’s most popular video game streaming sites appears to be several factors at play. First and foremost is the lack of popularity the service saw over the past year, with user numbers ebbing significantly in comparison to its rivals. In addition, the stiff competition posed by live-streaming platforms such as Bilibili and Huya – which boast far more users – has been identified as a major reason for the closure.
Tencent also cited a need to consolidate its resources and focus on “strengthening” its core businesses. Over the past year, Tencent has increasingly favoured optimising existing operations rather than investing in new projects; this may have been an important factor leading up to this decision. Additionally, since Chinese regulators have adopted tighter rules for domestic games publishers, Tencent may have wanted to free up resources for other endeavours less subject to government guidelines.
However, there is still speculation that the closure might have more sinister implications related to potential copyright infringement issues with some of its content providers. While these rumours remain unconfirmed and no such statement has been officially made by Tencent or other sources associated with it, this may be another factor in why they’ve chosen to shut down their game streaming service.
Competition From Other Sites
Tencent’s game streaming site, JOYY Game, was shut down in April 2021 due to increasing competition from other streaming platforms. JOYY has been one of the most popular game streaming sites in China. Still, the arrival of competitors such as Bilibili, DouYu and Kuaishou had significantly reduced its market share. Bilibili, especially, had made large inroads into Tencent’s user base thanks to its younger audience demographic (many users under 30) and initiatives such as a gaming-inspired clothing line.
Tencent may have seen an opportunity to capitalise on this growth by closing its service and reallocating some of those resources into their other successful streaming platforms like Huya (reportedly planning a US IPO). However, despite this decision, some analysts have pointed out that Tencent still has a strong presence in mobile gaming through its hugely successful title Honour of Kings and its very popular casual games, which will likely allow it to remain competitive with other players in the market.
Financial Issues
Tencent’s decision to shut down its video game streaming platform, Tencent Video Game Stream (TVGS), was likely due to financial pressures. The site’s popularity had grown rapidly in recent years, with more than 7 million active viewers from all over China. However, the company’s inability to monetize the platform effectively through ad revenue or subscription fees is thought to be behind their ultimate decision to close the site.
Furthermore, Tencent is facing increasing pressure from Chinese authorities regarding censorship policies, likely reducing its potential income further. The strict regulations mean that many popular titles are censored or blocked completely for Chinese audiences, meaning that adverts for these games can not run on TVGS. This has led to dwindling profits and in light of this, Tencent decided it would be better to close the site and focus on their other projects.
Impact of The Closure
The surprise closure of Tencent’s game streaming site has impacted a lot of gamers who used the platform to access the latest titles. Not only that, but publishers and developers have also been affected by the sudden shutdown. This article will explore the effects of the closure and how users of the platform have been impacted.
Loss of Revenue
Founded in 2013, Tencent’s game publishing and streaming platform was an integral part of the Chinese video game market. The platform provided gamers with access to a wide range of games and streaming services to facilitate the sharing and consumption of game content.
However, the closure of Tencent’s platform has resulted in a significant loss of revenue for its owners and many users who have been relying on its services for income. In particular, it is estimated that the shutdown of Tencent’s game streaming site has caused hundreds of millions of yuan worth economic losses for employees working in the industry, such as freelance esports casters and activities operators employed by websites or tournament organisers. Furthermore, these freelance operators have lost out on potentially lucrative opportunities since their main source of income is no longer available to them.
Tencent recently shut down its game streaming site, which was used to distribute popular PC and mobile games to the Chinese market.
The closure also means that fans cannot access gaming content from popular hit titles such as League of Legends and Overwatch. In addition, by not being able to view gaming streams produced by professional casters, viewers can no longer gain insights into gaming strategies while interacting with others in chat rooms. Therefore creating an overall impact on enjoyment derived from playing video games by those keenly interested in the industry before Tencent’s shutdown.
Disruption of Services
The closure of Tencent’s streaming site has caused considerable disruption to online gamers. The site had become increasingly popular for streaming PC and console games, with more than 8 million players tuning in every month. However, the closure has meant many gamers have been left without access to their favourite titles.
The sudden closure has cast doubts on the reliability of game streaming services going forward. Other streaming services will likely take steps to increase user confidence by offering a high level of security regarding the data shared between players and the platform.
Furthermore, the closure has served as a reminder that any service provided on the internet can change with little notice, even those run by large companies like Tencent. This has raised questions about the sustainability of game streaming services when major companies continue to close them down or make changes without prior notice.
Finally, it is also worth noting that some users lost money when downloading games through Tencent’s platform due to its pay-to-play model, meaning they now have no means of recovering their funds after the closure. This is another factor that may reduce consumer trust in similar platforms.
Conclusion
In conclusion, Tencent has closed its gaming streaming site to protect younger gamers from unhealthy habits. As the Chinese technology sector continues to evolve, the company is taking a proactive approach to safeguard its customer base. Tencent plans to continue to release other types of services and products that prioritise the safety of their user base and encourage positive gaming experiences for all ages. Ultimately, whether gamestreaming will come back in this particular service remains to be seen, but determining how and if younger audiences can safely consume these services is paramount and will continue to be a key factor as more innovative ways of gaming and consuming content appear on the market.
