The acquisition of Black Shark to grab the entrance is just the beginning of Tencent’s four major BG systems to lay out the metaverse

Does it matter whether you lose money or not?

“The layout of the metaverse must be a systematic project.” A person close to the transaction told Jinghe. Dismantling it down, from the hardware, software, operating system, Tencent will be in-depth layout one by one.

After more than half a year of research, Tencent finally started to seize the entrance of the Metaverse with hardware. On January 10, according to 36Kr report, Tencent plans to acquire Black Shark Technology with an offer of around 2.6-2.7 billion yuan. After the completion of this acquisition, Black Shark will be integrated into the Platform and Content Business Group (PCG) led by Ren Yuxin.

Jinghe learned that almost all Tencent BGs in the VR field are paying attention and eager to try. Among them, four groups of people from the Tencent Enterprise Development Group CDG are watching, the Tencent IEG Investment Department also has an investment group led by the technology line to follow up, and at least one group of people from the Tencent Cloud and Smart Industry Group (CSIG) is closely following up.

Almost all VR projects on the market have been swept away by Tencent.

must not be accidental

Why did you choose Black Shark Technology? You must have the same doubts as the author.

From the perspective of business layout alone, Black Shark Technology mainly focuses on gaming mobile phones, and it is not closely related to VR. From the perspective of the game mobile phone track, less than one million shipments a year, and the overall market plate is also limited.

The acquisition of Black Shark to grab the entrance is just the beginning of Tencent's four major BG systems to lay out the metaverse

People familiar with the matter told Jinghe that Tencent’s acquisition of Black Shark Technology generally has two considerations: one is that the Black Shark technology team is from Huawei and has the advantage of hardware supply chain; The Shark Technology team is relatively familiar, Ren Yuxin has a Huawei background, and the two sides have a foundation of trust. Under the promotion of Li Nachuan, Tencent’s first metaverse hardware finally settled on Black Shark Technology.

More than one senior investor told Jinghe that the VR track must be the game of big manufacturers. According to the logic of manufacturers such as Meta and ByteDance, it has become a consensus to acquire external companies to make related hardware. Of course, Tencent estimates that it is also mentally prepared for continued losses in three to five years.

In general, Jinghe believes that the entry of major manufacturers into the VR field follows the following path: hardware – content application – operating system. After spending $2 billion to acquire VR headset company Oculus in 2014, one of Meta’s follow-up focuses has been the acquisition of CP manufacturers, such as the VR audio game “Rhythm Lightsaber”. The focus of the past two years is to vigorously develop AR and VR operating systems.

Domestic ByteDance’s acquisition of Pico for 9 billion yuan and Tencent’s acquisition of Black Shark Technology for 2.7 billion yuan will also follow this path. In other words, a series of VR CP financing cases are expected to emerge in 2022.

In terms of personnel expansion, the VR business of domestic giants will also usher in rapid growth. Earlier The Information reported that Meta has now invested nearly 20% of its employees in VR/AR-related businesses. Meta’s VR/AR business is part of the same division, Facebook Reality Labs, led by company veteran Andrew Bosworth.

The Information notes that the division now has nearly 10,000 employees, or 17% of the company’s total of more than 58,000 employees at the beginning of the year, up from 5% in 2017. This figure is still growing.

Facebook founder and CEO Mark Zuckerberg has predicted optimistically that VR/AR device shipments will approach that of smartphones in the next decade. This means that the C-end consumer electronics market is expected to be a trillion-dollar market.

In response to this point of view, a number of industry chain people told Jinghe that the overall domestic VR market is relatively conservative, and the C-end shipments in 2021 will not exceed 500,000 units. The overall market size is more reliable with reference to host shipments.

Exploring the XR business

Going back to the target Black Shark Technology itself, it also explores the XR business in addition to gaming phones.

The acquisition of Black Shark to grab the entrance is just the beginning of Tencent's four major BG systems to lay out the metaverse

Earlier, Black Shark joined hands with AR glasses manufacturer Rokid to appear at 2021 ChinaJoy to jointly explore the immersive large-screen experience on the mobile terminal.

Rokid Air has been officially launched in September 2021. In addition to being compatible with smartphones such as Black Shark, this AR glasses are also adapted to PC games, Switch, PS4 and other console games to support users on the virtual big screen Work, watch videos, play games.

Compared with VR glasses that require more technical power and scene support, the cooperation between Black Shark and Rokid focuses more on creating a lightweight gaming experience.

The total weight of the Black Shark 4 mobile phone with Rokid Air does not exceed 300 grams, and as a lightweight smart glasses Rokid Air is also foldable. Without increasing the burden on the human body, it can realize multi-scene large-screen games and office practice.

Perhaps after this cooperation, Black Shark saw the potential in the AR/VR field and the prospect of the Metaverse. Compared with the crowded game phone and high-end performance machine markets where the track is crowded and users are more saturated, Black Shark has entered the AR/VR market to fish for the Metaverse. The first pot of gold will be a longer-term strategic choice.

According to Lu Weibing, general manager of the Redmi brand, “the total shipments of gaming mobile phone brands in 2020 will be around 1.7 million.” In the June 2021 mobile phone sales list, only the iPhone 12 model surpassed the 180w sales, and the share of game-related mobile phone categories did not exceed 3%.

Especially after Huawei suffered a sharp decline in its shipments due to technical sanctions, the high-end Android phone camp almost exclusively used Qualcomm Snapdragon flagship processors, and it is difficult to widen the gap in game performance. Work hard on recipes.

At the same time, because most mobile game users still have light and fragmented game habits, and heavy mobile game players account for a small proportion, even if the game phone has improved the performance and price performance to a high level, it is also It is difficult to have enough user potential and market depth for them to explore.

Instead of competing in the red sea of ​​mobile phones, it is better to change a project and a track to be the pioneer of the next era. This is a strategic turn for Black Shark, and it also meets Tencent’s strategic needs.

Tencent finally entered the metaverse hardware field

We often say that the construction of the metaverse is by no means a single word, it must be completed by multiple companies working together. As Tencent, which holds the two trump cards of gaming and social networking, Tencent has a unique advantage in the field of metaverse content.

However, in the context of the lack of cores in the global market and the Sino-US trade war in recent years, the importance of technology and hardware has become increasingly prominent. For a company of Tencent’s size, focusing only on content and ignoring technology is tantamount to rootless Water, wood without roots.

Tencent’s layout in cloud games, game engines, etc. over the years has also confirmed that Tencent does not only want to be a content provider for the future metaverse.

At present, Tencent Xianyou cloud game now has the form of mobile phone, PC and TV, truly realizing the cross-end experience. In the future, Tencent Xianyou will also cooperate with NVIDIA on the underlying technology of cloud games to achieve a number of key technological breakthroughs in mobile cloud game solutions.

Epic Games, the developer of Unreal Engine, was also acquired 42% of the shares by Tencent in 2012. As one of the most advanced real-time 3D creation platforms in the world, the future metaverse scene construction will definitely not lack the presence of Unreal Engine.

And this time, Tencent has finally begun to lay out the entrance to the metaverse – AR/VR equipment.

The acquisition of Black Shark to grab the entrance is just the beginning of Tencent's four major BG systems to lay out the metaverse

In fact, as early as 2015, Tencent announced its own VR game ecological strategy at the miniStation micro-game console conference. At the same time, its VR official website was officially launched, and Tencent’s VR global developer recruitment plan was also in progress.

At that time, Tencent’s positioning direction for the future use of VR was mainly in the fields of games, film and television, social networking, online, and maps. And entertainment content is obviously an important consumption of VR, followed by life. Tencent’s VR global developer recruitment plan also focuses on supporting developers from four aspects: account system, social system, distribution platform, and payment platform.

At that time, the mobile Internet was not yet fully mature, and the concept of the true Internet was rarely mentioned, but from the layout of Tencent in its early years, it can still be seen that Tencent has always maintained their usual platform thinking.

Relying on its user scale and social system, uniting hardware and content developers, and building a VR user service platform, it is more likely that Tencent will expand in the VR field.

On the road of platformization, Tencent has also briefly dabbled in the production of VR hardware. On Tencent T-Day in 2018, Tencent showed its first VR headset device – TenVR for the first time in China, but the device was still in the engineering verification stage at that time, and its weight and resolution were not outstanding compared with other products on the market. Competitiveness, and then Tencent’s VR hardware business fell silent.

The acquisition of Black Shark to grab the entrance is just the beginning of Tencent's four major BG systems to lay out the metaverse

However, in the past three years, Tencent has made great progress in the investment field. In 2021 alone, Tencent has acquired or invested in more than 100 video game-related companies, with an average of about 3 days to acquire or invest in one. 

Tencent’s current thinking is “Let professional people do professional things”, and it continues to take root in the social and game fields that it is good at so as to radiate other related businesses. The acquisition of Black Shark may be precisely because of the genes of “game + hardware” in Black Shark.

As the saying goes, leaning against a big tree is good for enjoying the shade. We will wait and see what kind of fruit VR and Metaverse can bear on the big tree of Tencent.

Posted by:CoinYuppie,Reprinted with attribution to:
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