ByteDance, the parent company of TikTok, is currently engaged in discussions regarding the potential sale of its gaming division, Nuverse, to various interested buyers, including Tencent.Â
This strategic move aims to offload struggling assets amidst the highly competitive gaming landscape.
Nuverse, initially perceived as pivotal for ByteDance to establish a foothold in gaming and compete with industry giant Tencent, encountered setbacks since its inception in 2019.
Despite high expectations, it failed to achieve the anticipated success.
In a prior step to mitigate losses, ByteDance underwent a downsizing of its gaming division in November, a move that involved significant layoffs.
This action signaled a reevaluation and potential retraction from the gaming sector.
China, renowned as the world’s largest gaming market, has witnessed tightening regulations imposed by authorities.
These regulations limit minors’ gaming durations and enforce restrictions during significant holidays, such as the Spring Festival.
Tencent, a dominant force in the global gaming industry, has grappled with challenges arising from these regulatory constraints.
The company has undertaken measures like real-name verification and setting restricted gaming hours for minors to comply with these regulations.
In response to concerns raised by the market following the announcement of stringent regulations, Beijing is contemplating revisions to recently drafted online gaming rules.
The objective is to curb excessive gaming behavior and in-game purchases, aligning with growing societal worries about these aspects.
The potential changes in online gaming regulations have also affected major tech stocks, prompting a sell-off in the market.Â
