TikTok Explores Sale of Gaming Arm

ByteDance, the parent company of TikTok, is in discussions with potential buyers, including Chinese tech giant Tencent, to offload its gaming subsidiary, Nuverse, a move aimed at streamlining its focus amid fierce competition in the gaming industry.

ByteDance had once positioned Nuverse as a key player in challenging Tencent’s dominance in the global gaming scene. However, ongoing talks suggest ByteDance’s willingness to divest from its gaming assets, marking a strategic shift.

The spokesperson, who shared this information on Tuesday, revealed that efforts to finalize a deal are still in progress, keeping details confidential.

This development follows ByteDance’s significant downsizing of its gaming division last November, involving substantial layoffs. The decision to scale back came after Nuverse fell short of the anticipated commercial success since its launch in 2019.

China, being the world’s largest gaming market, sees Tencent as a major industry player and one of the country’s leading media conglomerates, contributing significantly to the $42.2 billion gaming sector in 2023.

However, Tencent faces challenges as Chinese authorities tighten regulations on gaming, particularly for younger players. Recent restrictions limit online gaming for those under 18 to specific time slots on designated days, with additional limitations during the Spring Festival Holiday, enforced through a real-name verification system linked to national ID cards.

In a WeChat post on Tuesday, Tencent explained these rules, expressing a desire for both adults and children to engage in gaming with self-discipline.

Beijing recently hinted at potential revisions to newly drafted online gaming rules, responding to concerns about in-game purchases and obsessive gaming behavior, which had triggered a sell-off in major tech stocks.