ByteDance, one of the world’s most valuable unicorns, has set up game development teams in five major Chinese cities, as it counts on the new business to more than double its revenue to USD 17 billion this year, local news media TechPlanet reported.
The Beijing-based startup, which operates viral short-video sharing app TikTok and news aggregator Jinri Toutiao, has deployed game development teams in Beijing, Shanghai, Guangzhou, Shenzhen and Hangzhou.
Industry insiders predict that ByteDance’s games will apply its AI-based algorithms, which contributed to the success of TikTok, otherwise known as Douyin in China.
Earlier this year, ByteDance bought two game publishers, Mokun Technology and Shanghe Internet Technology, as it paved the way to enter the gaming business. It also launched a new project, dubbed “Oasis,” to develop its own heavy games, KrASIA reported in June.
These moves signal that the seven-year-old firm is stepping up its offensive against social media juggernaut Tencent’s dominance in the sector.
Tencent’s online games brought in nearly USD 4 billion to the company in the second quarter of 2019, accounting for one-third of its total revenue for the April–June period, according to a company’s earnings report.
With more than 150 million monthly active users, ByteDance reportedly hit a net revenue of USD 7.2 billion last year and managed to turn into profitability in June. The yearly revenue target was raised along with the robust growth.