Four individuals familiar with the situation told Reuters that ByteDance, the producer of TikTok videos, is scheduled to internally announce on Monday that it will be completely withdrawing from mainstream video games and shutting down its Nuverse gaming brand. In a significant departure from the gaming industry, ByteDance Ltd. intends to eliminate hundreds of positions and wind down its flagship brand Nuverse, giving competitor Tencent Holdings Ltd. the upper hand.
The insiders, who wished to remain anonymous since the information is confidential, stated that the Chinese technology company had no intention of entering the $185 billion worldwide video game business again. According to the sources, ByteDance will instruct staff members to cease development on unannounced games by December and will explore methods to remove itself from already-released products.
Numerous employees, some of whom found out about the relocation over the weekend, are expected to be impacted by the decision, according to the individuals. According to one of the sources, casual games that are available on TikTok and the casual gaming company Ohayoo, which has games on Douyin, TikTok’s sibling app in China, won’t be impacted.
Revelation by Reuters
A request for comment from Reuters was not answered by ByteDance. This month, Reuters revealed that ByteDance has begun looking for owners for its subsidiary Moonton Technology, which develops video games. Additionally, it reorganized Pico, its virtual reality business, and reduced the size of its content team.
Several hundred workers will be let off by TikTok’s owner, who will also wind down ongoing projects and consider selling current copyrights, according to persons with knowledge of the situation. One insider who asked to remain anonymous said that the Chinese corporation plans to announce the move on Monday. They were talking about a private arrangement.
With its closing, ByteDance has made its largest departure from the once-thriving gaming sector, which was controlled by Tencent and its smaller rival NetEase Inc. After losing out to Tencent for market dominance, the startup best known for its short-form video platforms TikTok and Douyin has progressively lowered its gaming goals in the post-Covid era. According to Bloomberg News, the Beijing-based company is thinking of selling Shanghai Moonton Technology Co, a prestigious studio it purchased for US$4bil (RM18.72bil) in 2021.
After the success of TikTok
Thanks to the viral success of TikTok and Douyin, Zhang Yiming and Liang Rubo created ByteDance more than ten years ago, and it has since grown to become a leading online platform valued at over US$200bil (RM936.10bil). In an attempt to enter the gaming industry, it has purchased studios and exclusive distribution rights to several games in recent years, trying to upend social media players like Tencent and Meta Platforms Inc.
However, making video games is a very unstable industry. ByteDance has been cutting development staff and closing in-house studios since last year. The company has shifted its attention to core industries like e-commerce and short video. It also reduced nearly a fifth of its workforce at Pico, its virtual reality division, this month.
The action role-playing mobile game Crystal Of Atlan, which made its much-anticipated premiere during the summer, is one of ByteDance’s biggest blockbusters. The owner of TikTok distributes the popular card game Marvel Snap, created by US company Second Dinner, all over the world.
