The Biggest Gaming Company You’ve Never Probably Heard Of

Posted in Kulturecade by - November 30, 2016

When you think of what may be the largest gaming company out there, it’s to expected that you will probably think of Microsoft, Sony, Valve, and EA. But you probably don’t think about a company called Tencent.

Now, you’re very likely to be wondering: “What exactly is Tencent ? “and “How big are they ?”.

On November 11th of 1998, in Shenzhen Guangdong, China, a company called Tencent was founded, it was incorporated into a much larger company and wasn’t able to generate a profit for the first three years. They had an instant messaging program that was considered to be their main program for its first few years and was formerly called “Oh, I seek you” but it was changed to “QQ” due to a confusion with another similar product of another company at the time, the “ICQ”, possibly a legal mess although it has never been confirmed.

Initially, the company only made money from advertising and a premium membership to “QQ”, but their business grew fairly quickly and they were very savvy with virtual goods and eventually made the majority of their profit from there. By that time, they had also generated a mascot (a Penguin with a scarf), which was incredibly popular in China. They started licensing him out, and you could start seeing it in everything from hats to shirts, shoes to snack food.

It was a pretty lucky mascot, and all that licensing generated a lot of money for them, and that money they decided to invest in video games.

Tencent acquired the license to operate Dungeon Fighter Online in China, which was a rather popular game that Chinese people liked but was run outside the country, so they could provide a closer service to what was expected locally. That game has generated over 2 billion dollars in revenue although it has ceased operation at this point. The company also did this to a couple of other games and grew significantly by hiring developers to do the work for them, but they do have their internal development studios.

The remarkable turn for Tencent was around 2011, it had acquired a majority in Riot Games, the company that developed League of Legends. They started near 2006 and had focused on that single product, and that only product nowadays just so happens to be the largest and most famous E-sport in existence, as the E-sports industries gradually turn into one of the biggest gaming sub-industries. Riot Games first revenue exceeds 1.5 Billion dollars, and nowadays they are entirely own by Tencent.

In 2012, Tencent bought 48.4 % of Epic Games, which is probably why Gears of War was sold to Microsoft, it’s because Epic Games is now focusing on much more online team multiplayer content, their revival of the Unreal Tournament is evidence of this. Tencent also owns 12% of Activision/Blizzard giving them a stake in World of Warcraft, Diablo, Overwatch, Hearthstone, Starcraft, and any other product the Activision/Blizzard might be working on. The Activision/Blizzard total revenue is 15.4 billion dollars a year which give them a massive influx of possible revenue a year from this investment.

Now, here it’s when it starts to get a little bit scary, when the gaming industry talks about companies doing unsavory things, we think about DLC’s and micro-transactions, which to be fair are terrible. But do you know when people tell you to read the terms and condition and it’s just ignored, well Tencent abuses that attitude.

Tencent is probably the worst regarding that, according to a report from Reporters without Borders, the company provides the Chinese government with full surveillance of their users; they can monitor online conversations, chat logs, they can track keywords, they can identify specific users and follow them.

The EFF ( Electronic Frontier Foundation) rates the services that Tencent provides to out of seven, or Essentially Unsecure, and since they own part of several American companies, I think it’s alright to say you’re not safe, your data isn’t safe. Tencent is the biggest gaming company in the world, although you’ve never heard of them but if you play their games, then they’ve definitely heard of you and have all of your data on file somewhere.

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