Leadership & Strategy
Tencent restructures, creates two new business divisions
May 20, 2020
Tencent Holdings has announced its first restructuring in six years, closing three business divisions and opening two new ones in their place
Its three closed businesses, Mobile Internet Group, Online Media Group, and Social Network Group, will be rolled into its two new divisions: Cloud and Smart Industries Group (CSIG), and Platform and Content Group (PCG).
The firm said that no layoffs are planned as part of the restructure.
CSIG “will emphasize Tencent Cloud, Internet plus, smart retail, education, healthcare, security and LBS (location-based services) related industry solutions,” according to TechNode.
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PCG, meanwhile, will be tasked with integrating social media and networking platforms into Tencent’s technology and content, comprised of news, sports, video, music, literature, anime, and more.
The Chinese tech giant, whose largest business is in the video game industry, has been under increased regulatory pressure from the Chinese government as it cracks down on children’s ease of access to games.
Since March this year, the Central Propaganda Department has not approved licensing for any new video games, and Reuters reported that the crackdown is the likeliest culprit for Tencent’s “first quarterly profit fall in nearly 13 years.”
Reuters said that Tencent’s biggest game this year, PlayerUnknown’s Battlegrounds Mobile, has not had its in-game purchases approved by Chinese authorities, meaning that Tencent has not been able to make money from the game.
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