Tencent Facing Internal Struggles in Its Mobile Game Sector
2014-07-23 11:22

Tencent Facing Internal Struggles in Its Mobile Game Sector

Mr. C, operation manager from interactive entertaining group (IEG) of Tencent, has been quite worried recently.

On the one hand, the daily profit of 3D ARPG, the product representing Tencent in its battle with 360, has dropped to around hundred thousand RMB.

On the other hand, another capable group leader in his department submitted to him a resignation letter. As he already got the support from risk investment and his team organized, he is determined to leave Tencent.

What is more disturbing for Mr.C’s team is that Yingyongbao (an app store introduced by Tencent for smart phone users) is recruiting operation staff for game.

Mr. E, director from another department of Tencent, just made a not very difficult decision—quit. The total percentage of resignation in recent months has been up to 30%, from which he could imagine, if he did not quit, he would face with formidable challenges in the future evaluation.

Behind their worries, is the general backdrop of continuous hit of mobile game industry.

I have been visiting several entrepreneurs in Shenzhen who used to work in Tencent. From their narratives, it can be referred that the Tencent empire is facing a crisis, at least in its human resources management.

The institutional drawbacks of big companies, internal interest struggle, less gains than expected, and fervent support from external capital, these four factors combined, are eroding the basis of the Tencent empire. The wealth-making legendaries of Wang Weifeng of Papa Sanguo Game and Wang Xinwen of Dota Legend, are undoubtedly speeding this process.

Institutional drawbacks

When Mr. G first joined Tencent, he had already worked in two companies, for seven to eight years.

Along with him in joining Tencent, are many university graduates recruited on campus, with full compassion yet little real life experience. The vigor and passion of these young people even made him feel a little ashamed, thinking that he was not working actively enough.

These young people can find the good sides of Tencent and at most time give positive comments of the company. They are very thankful for their growth in Tencent, their welfare, the atmostphere of the company, the friendly colleagues, the career development system, etc, which are all very outstanding among internet companies in China.

Unlike this freshmen in career, Mr. G had different thoughts. He had been to different cities and witnessed different companies. He could spot the drawbacks in the system of Tencent at the first sight. He had tried to give his suggestions to their human resources department yet was declined.

A story of his friend made Mr. G believe that in Tencent, it is very important to join the right project. His friend, chose an unknown game over QQ Car, and failed.

Senior staff occupying many positions, little room for promotion, resources difficult to coordinate, innovation not easy to practice, etc, all these common drawbacks of big companies can be found in Tencent. Yet Tencent has a relatively sound system compared with the feedback from his friends working in other big companies.

Internal struggles

Every big company has internal struggles, and the more interests concentrate, the more struggles will occur. This is especially the case in Tencent.

In Tencent, besides competition between different programs, there has been conflicts of interested between platform product department and game department.

Mr. K told the author, when Martin (Liu Zhiping) reformed the structure of the company and combined all of the game operation and development teams into IEG, the problems in implementation and professionalism were indeed solved to some extent. However, internal conflicts were still existing under the appearance of harmony.

Take Yingyongbao as an example. This product is introduced as a unified brand of Tencent mobile games. This kind of ‘unified’ product, for many departments inside Tencent, somewhat implies mandatory. The usual practice of Tencent is that high-level staff use their power to bring together several departments to promote the same project and to do experiment, while leaving those less obvious problems to be dealt with latter.

The development of Yingyongbao is in mobile internet group (MIG). Mobile products including mobile servant, mobile browser, etc, are all developed by MIG. Yet, the external platform of Yingyongbao, including business cooperation, is managed by social network group (SNG). Mobile QQ and other social products are all managed by SNG. In the meantime, the operation department of IEG is in charge of coordinating resources and operation of mobile games.

Gap between expectation and reality in gains

For people working in other mobile game companies, the salary in Tencent is their dream goal, and even the role model in the whole industry.

However, people inside Tencent hold different views. Product department think that they should gain more as they make the biggest contribution. On the other hand, game department do not agree. The same platform, products of different quality, operation under different teams, incomes are wildly different. 

Fervent support from capital

During my discussion with entrepreneurs who used to work in the mobile game department of Tencent, a legendary figure was frequently mentioned. He is Wang Xinwen.

Graduated from Nanjing University in 2009, Wang Xinwen worked in the Tencent Aurora workshop as game designer and is now the CEO of Lilisi, the developer of Dota Legend, which receives much attention in the whole industry. It is estimated that, Lilisi could be sold at a price up to 5 billion RMB.

The fervent support of capital for promising entrepreneur teams undoubtedly raises the expectation of people inside Tencent, thinking that if Wang Xinwen could make that much fortune, why can’t I? After all, I even have more experiences and resources in the mobile game industry.

When talking with these entrepreneurs who used to work in Tencent, I often heard a saying: ‘good timing, geographic convenience and harmonious personal relationship’. They will envy Wang Xinwen, but will focus more on doing their own part in things they are good at.

Maybe in the future, Tencent will further develop from the current trend, changing into a pure holding company, with social capital as its core and investing in external entrepreneur teams.

Source: Huxiu.com


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