Tencent Metaverse has changed? What happened to Black Shark in the 67 days it was rumored to be acquired

More than 60 days after it was rumored that it was acquired by Tencent, there has been more information about Black Shark Technology recruiting for the VR business.

VR display system expert, VR vision engineer, VR camera system engineer, VR system interaction designer, VR optics expert, software product manager… As of March 18, on the recruitment website, the jobs related to VR business published by Black Shark include several Ten, distributed in Shanghai, Shenzhen and other places. 

Tencent Metaverse has changed? What happened to Black Shark in the 67 days it was rumored to be acquiredSource: boss directly hired

On January 10, according to 36Kr report, Tencent plans to spend 2.6-2.7 billion yuan to acquire Black Shark Technology, a gaming mobile phone company. After the transaction is completed, the company’s business focus will shift from gaming mobile phones to VR devices, providing Tencent with a VR hardware entrance. . 

A week after news of the acquisition broke, media reported that the acquisition was “almost in the final stages.” 

But recently, rumors about “there are variables in this acquisition” have been circulating in the VR circle.

A person close to Black Shark told All Weather Technology: “Tencent’s due diligence has been done for a long time, and I haven’t heard of any changes (acquisition).”

Another person familiar with Black Shark revealed that there have been some actions inside. Including the founder and former CEO of Black Shark, Wu Shimin, has now returned to manage the supply chain; and the internal rumor is that the next step will be the combined development of VR equipment and game mobile phones.

Before the dust settles, this acquisition with keywords such as Tencent, Xiaomi, VR, and Metaverse is still attracting attention from all parties. 

1. Is everything ready for the acquisition?

“Sharks don’t have swim bladders, so they can only swim continuously and become the dominant player in the ocean. We do not want to change the world, but we just want to make a good product for Chinese players and build a real gaming phone.”

This is the vision promised by Wu Shimin, the founder and former CEO of Black Shark Technology, when Black Shark Technology was founded five years ago. 

Since its establishment, Black Shark has launched a number of gaming phones, and it has long been “dominant” in the professional gaming phone shipments rankings. 

Tencent Metaverse has changed? What happened to Black Shark in the 67 days it was rumored to be acquiredSource: Black Shark official website

After the news that Black Shark was acquired by Tencent, Black Shark has been making frequent moves recently. 

At this time, a large number of jobs in the VR business have been added, which is also interpreted by the outside world as Black Shark making up for the shortcomings of the business manpower and technology in preparation for integrating into Tencent. 

In fact, Black Shark’s turn to VR business has long been followed. 

At last year’s ChinaJoy, Black Shark showed the outside world an AR glasses called RokidAir. Another company’s information shows that since November last year, Black Shark Technology Nanchang Company has applied for registration of a number of Metaverse-related trademarks, including “Black Shark”, “Black Shark Metaverse”, and “Black Shark META” , as well as “Black Shark AR”, “Black Shark VR”, etc. 

However, among Black Shark’s internal staff, there are still doubts about whether the company will focus all its efforts on VR equipment in the future. More saying is that Black Shark will retain the gaming mobile phone business and combine the two businesses. 

“The same is true inside.” The above-mentioned person familiar with Black Shark told All Weather Technology. 

“The main purpose of Tencent’s acquisition of Black Shark is to lay out the Metaverse. As for how to deal with this part of its mobile phone business, it is actually a technical problem of a company.” TMT independent analyst Fu Liang believes. 

In his view, gaming phones cannot be the part that investors (Tencent) focus on. After all, as a big game player, Tencent attaches great importance to the cooperation of game mobile phones. In addition to Black Shark, Tencent has also cooperated with Red Devils, Aiku, OnePlus and other gaming phones to varying degrees before. 

“Tencent will not make (game phones) by itself, and may even be afraid that some people think he has such an idea, and then affects the development of the game business and affects the application level.” 

Even so, Black Shark has put more effort into this acquisition. On the company’s management level, the latest news is that Wu Shimin, the founder and former CEO of Black Shark, has returned to manage the supply chain. “Peter (Wu Shimin) was a director before, and he was responsible for finding money for the company regardless of specific matters, and now he is back in charge of the supply chain.” A person familiar with the matter told All Weather Technology. 

As the founder of Black Shark, Wu Shimin has a glorious past – a former Huawei employee who was the president of Huawei’s mobile broadband terminal product line when he left. He was the main person in charge of Huawei’s Maimang series and G series, and the director of Huawei’s North Research Institute. Has created a single sales record of over 10 million. After leaving Huawei, Wu Shimin worked as the general manager of Shenzhen Zhongsi Technology Co., Ltd., which is controlled by LeTV. 

In January 2020, Wu Shimin announced on Weibo that he would resign as the CEO of Nanchang Black Shark Technology, and the company’s CEO position will be taken over by co-founder Luo Yuzhou. After leaving office, he will devote more energy to the company’s strategic planning, investment and cooperation. 

After stepping down as Black Shark CEO, Wu Shimin appeared less in public, but he still played the role of Black Shark’s “online spokesperson”. Whenever a new product is released, he will promote the product on Weibo. 

However, Wu Shimin has not updated Weibo since the end of October last year. His last Weibo stayed on October 28, 2021, and the content was the promotion of the Black Shark Double Eleven pre-sale strategy. 

A person familiar with the matter told All Weather Technology that after leaving office, Peter found some investment for the company. In fact, before Tencent, there were many investors who had contact with Black Shark, but in the end, these contacts were not followed. 

2. “Outstanding Student” Black Shark

Two months ago, when the news of Tencent’s proposed acquisition of Black Shark came out, it was hard not to think of the scene when ByteDance spent $1.5 billion to acquire Pico, a VR all-in-one maker, last year.

If we say that Pico is the “Metaverse ticket” found by ByteDance. Then, Black Shark is Tencent’s hope to the Metaverse. 

Black Shark Technology was established in August 2017, formerly known as Zhongsi Technology, an intelligent hardware company controlled by LeTV. After being spun off from LeTV, Wu Shimin took part of the mobile phone R&D team to find another way out, and Black Shark Technology was born. 

The founding team is luxurious. Luo Yuzhou, the co-founder and current CEO of Black Shark, is also from the Huawei Legion and served as the vice president of Huawei’s consumer business in China. The team also has first-class talents from Huawei, Samsung, Tencent, Ali, Lenovo and other companies. 

Although the two CEOs of Black Shark are from the Huawei Legion, Wu Shimin and Luo Yuzhou have different styles.According to a former employee of Black Shark, “Wu was born in R&D and was diligent and rigorous. Luo was more mellow in sales, but he was kind to his employees.” 

According to Wu Shimin’s previous recollection, he accompanied Lei Jun on the high-speed train from Hangzhou to Beijing, and introduced the product design concept and future planning of Black Shark to Lei Jun for nearly 5 hours along the way. Lei Jun agreed to invest. According to rumors in the industry, Wu Shimin and Lei Jun’s intermediate contact person is Liu Jiangfeng, the former CEO of Coolpad. 

According to industrial and commercial information, Tianjin Venture Capital Industrial Co., Ltd., which is wholly-owned by Xiaomi, holds 46.4% of Black Shark Technology and is the major shareholder of Black Shark. 

In addition to Xiaomi, Black Shark also has the support of Nanchang Jinkai Group, a subsidiary of Nanchang Economic Development Zone. Its subsidiary Nanchang Jinkai Capital Management Co., Ltd. is the second largest shareholder with a 26.6% stake. 

In the year Black Shark was founded, global smartphone shipments fell for the first time, with the Chinese market bearing the brunt. Mobile games such as King of Glory have begun to develop into e-sports. 

Tencent Metaverse has changed? What happened to Black Shark in the 67 days it was rumored to be acquiredSource: Black Shark official website

But at that time, smartphones were limited by hardware, and it was difficult to play the best performance in games. Wu Shimin is facing an unexplored field. 

“(We) want to create the first gaming phone designed for Chinese players.” Wu Shimin once made it clear in an interview that his target group is the game enthusiasts and e-sports players with hardware needs. 

Under the above background, the establishment of Black Shark Technology occupies multiple favorable factors such as time, people, and money, which can be called a perfect start. 

In addition, Black Shark’s R&D strength and hardware production level are also envied by the outside world. 

On the eve of Black Shark’s release of its first mobile phone, Wu Shimin posted a long Weibo account for the first time to introduce the Black Shark entrepreneurial team to the outside world. The blog mentioned that Black Shark has more than 300 employees in just 7 months of establishment, of which more than 90% are designers and engineers. This also established the style of Black Shark’s heavy research and development. 

In the eyes of employees, Black Shark is a company with both R&D and innovation. “Among the gaming phones, Black Shark was the first to do a lot of work in display mode, heat dissipation, and antenna. For example, it proposed sandwich heat dissipation.” 

Tencent Metaverse has changed? What happened to Black Shark in the 67 days it was rumored to be acquiredA new generation of “sandwich” liquid cooling system Source: Black Shark official website

In April 2018, Black Shark’s first gaming phone was launched, which is also the first gaming phone in the domestic industry. Although the sales volume is only a few hundred thousand units, in the vertical field of gaming phones, Black Shark is already in a leading position. 

Of course, this is inseparable from Black Shark’s supply chain and channel dependence on Xiaomi. 

A person familiar with the matter told All Weather Technology that with the advantage of Xiaomi’s supply chain, Black Shark can get high-quality accessories and materials. Similarly, in terms of sales channels, in addition to selling through JD.com’s self-operated e-commerce, Black Shark is also sold in Xiaomi Mall. “It’s impossible for small manufacturers to do it.” 

Huawei, Xiaomi, Tencent—from its inception to the present, the labels of big manufacturers can be seen at every stage of Black Shark’s development. But even so, Black Shark Technology, which was born and grew up with a golden spoon, was eventually bound by the “game phone” on which it lived. 

3. Survive through cracks

At the moment when the mobile phone industry is seriously involved, it is not easy for a niche brand to break out of the siege, even if this brand is the black shark, the first brother of gaming mobile phones.

Professional analysts pointed out that in order to achieve long-term development of game mobile phones, it is necessary to have the ability to produce its own content and have advantages in hardware. 

However, self-made content has always been a headache for existing game manufacturers, and in terms of hardware, the advantages of game phones such as ultra-high battery life, liquid cooling, and high-resolution screens have gradually become standard for mainstream mobile phone manufacturers. 

“Nice mobile phones such as gaming phones still had opportunities a few years ago, but now there is less and less space, because the functions of mainstream mobile phones are getting stronger and stronger, and ordinary mobile phones can also meet the needs of daily gaming. The ability of mainstream mobile phones to control key components is getting stronger and stronger, and it has become very difficult for gaming mobile phones to get better configuration.” Fu Liang said. 

In his opinion, the current situation of Black Shark is similar to that of Meizu. “It’s not entirely about lack of money. It also includes the issue of market space.” 

According to data released by IDC, the market share of TOP5 brands in domestic smartphone shipments has increased from 93.5% in 2019 to 96.5% in 2020, and the Matthew effect is still intensifying. Opportunities for other brands are shrinking. 

“For Black Shark, either it is wholly-owned by Xiaomi and becomes a sub-brand of Xiaomi’s strategic brand, or it is to get rid of Xiaomi and find another way out.” Fu Liang said. 

Obviously, Black Shark chose the latter. As early as the beginning of last year, Black Shark released financing needs. 

Another reason for Black Shark to speed up its efforts to seek contact with the capital may be that it has a competitive relationship with Xiaomi’s sub-brand Redmi in the product line. 

The enhanced version of the game launched by the Redmi flagship K series, the main game scene, and the Black Shark game phone have a high degree of overlap. In April 2021, Redmi released an enhanced version of the K40 game. The sales of the new product exceeded 100,000 units in just 1 minute. This kind of achievement is beyond the reach of the Black Shark. 

In terms of price, the Redmi K40 game enhanced version is priced at 1999 yuan, which is a mid-range price game phone.The Black Shark 3 released before it starts at 3499 yuan. Comparatively speaking, consumers are more accepting of the price of the Redmi K40. 

Although Luo Yuzhou once said in a high-profile manner, “the end of the flagship mobile phone is the starting point of the Black Shark.” However, the “professional” gaming phone in his eyes was called “chicken ribs” by some users due to its low cost performance. 

Even within the Black Shark, the issue of “whether to produce a mid-range gaming phone around 2,000 yuan” accompanies almost every Black Shark product. 

“Since the first generation of products, we have considered whether to make a mid-range phone or not. Some people think that this can expand shipments, while others think it is not in line with the company’s overall strategy.” A person who has been in charge of Black Shark mobile phone products Employees tell 24/7 Tech. 

In a stalemate, the “high-end” label has never been able to bring a wider user base to Black Shark. 

The market share list of major gaming phone brands from the second quarter of 2018 to the first quarter of 2021 released by Canalys shows that in addition to the ordinary gaming phones of major manufacturers, the industry’s default four professional gaming phone brands Black Shark and Red Magic , ROG, and Savior, the combined market share of the four is only 33%. Among the four major brands, Black Shark ranks first with a 13% share. 

Tencent Metaverse has changed? What happened to Black Shark in the 67 days it was rumored to be acquired

The well-known iQOO, Redmi, realme, OPPO and OnePlus, although practitioners in the niche market of gaming phones do not agree that they are classified as gaming phones. But the truth is, the lines between professional gaming phones and non-gaming phones are getting blurry. 

Taking iQOO as an example, the official league of Tencent’s star mobile game “Honor of Kings” has chosen this brand of mobile phone as the game machine since 2019. 

The living space of the “Black Sharks” is getting smaller and smaller, so that their positioning has also loosened to a certain extent. This can also be seen from the pricing strategy of Black Shark mobile phones. 

When the Black Shark 3 was released two years ago, the starting price was 3499 yuan, and the starting price of the Black Shark 3 Pro was 4699 yuan. Last year, when the Black Shark 4 was released, it dropped by 1,000 yuan directly, and the starting price dropped to 2,499 yuan. 

In this regard, Luo Yuzhou explained that most of the Black Shark users are between the ages of 18 and 30, and the price pressure is relatively high relative to income. Moreover, in order to promote the development of the entire industry, Black Shark cannot be arrogant. 

“In the beginning, I still hope that more and more people can experience gaming mobile phones.” Luo Yuzhou said. 

“In fact, everything is for the success of business.” A former Black Shark employee explained this.

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/tencent-metaverse-has-changed-what-happened-to-black-shark-in-the-67-days-it-was-rumored-to-be-acquired/
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