Earlier this week, Tencent Holdings made an official announcement to its employees that it was launching a subsidiary dedicated to “extended reality” (XR), formalizing its commitment to the metaverse development and virtual worlds.
Li Shen, Tencent Games Global Chief Technology Officer, will continue to oversee the company’s progress in this space. Moreover, the company has announced that it will remain affiliated with the Interactive Entertainment space, pushing for further tech advancements.
As part of the new organization, Tencent will focus on growing its extended reality business, which includes hardware as well as software.
The new metaverse arrangement
As per two insiders, Tencent eventually plans to employ over 300 people and form a dedicated department as the company ploughs into the space. Given its recent cost-cutting and hiring freeze, this estimate is reasonable. Though, the sources did warn that the company’s hiring plans are still uncertain since the business unit’s numbers will be adjusted as it performs.
It was established earlier this year that Tencent is planning to enter the metaverse market, but it was kept under wraps. The concept of extended reality includes immersive technologies such as virtual reality and augmented reality, which is considered the foundation of the metaverse.
Tencent metaverse world
In recent years, investors, entrepreneurs, and tech giants have become increasingly interested in metaverses. Ever since Mark Zuckerberg, the CEO of Facebook, announced that the company will be converging its most resources and energy into building a metaverse.
Companies like Microsoft and Disney joined the race too as they are creating their own metaverses, and ByteDance, the owner of TikTok, and Apple are expanding their XR headsets.
The start of it all
XR will be Tencent’s first foray into hardware, as the company is mostly known for its software solutions such as games and social networking programs.
It was originally attributed to Tencent’s founder and CEO, Pony Ma, that the “all-real internet” concept was first marketed in late 2020.
As a result of a regulatory crackdown, Tencent has taken measures to cut costs and cut non-core activities, including closing Penguin Esports and launching the new team contrasts with downsizing other parts of the company.
The company has largely remained silent about plans for a metaverse. A company representative told investors in November that Tencent has a lot of “tech and capacity building blocks” to address the metaverse opportunity.