Tencent expands aggressively overseas


QQ and WeChat are set to step up overseas investment.

 

WeChat logoTencent Holdings Ltd, owner of two of China's most popular social networking platforms, has announced it has already spent around $2bn internationally, mostly in the acquisition of promising tech startups and gaming operators.

Most notably, the $100bn company has a 48.8% stake in Epic Games, the developer of the Unreal animation engine used in most video games, a 6% stake in Blizzard - which is responsible for the World of Warcraft series - and seven separate Korean gaming companies.

WeChat, a cross-platform messaging service similar to the popular WhatsApp application, has also unveiled plans to invest a further $200m for marketing overseas this year.

The wholly-owned unit of Tencent holdings has already seen overseas registrations double between May and June this year to 100m users, after a series of adverts featuring football star Lionel Messi broadcast across Asia and Latin America proved popular.

Despite a large number of acquisitions and hefty marketing clout, the Chinese company may stil find it tricky to penetrate saturated US and European markets, where SNS adoption is already high.

Nevertheless, with 150m Chinese citizens living outside the Mainland and an increasingly socially mobile population, Western oilcos planning marketing campaigns on Chinese platforms in domestic markets could seize an opportunity to develop a strong following early on.