Chinese gaming giant Tencent looks to Southeast Asia with Sea partnership amid regulatory uncertainties at home
- Sea operates Southeast Asia’s biggest gaming platform with 161 million quarterly active users
- Region one of the fastest-growing in gaming, with revenue of US$2.2 billion last year
Tencent Holdings, China’s biggest social media operator and games publisher, has partnered with Singapore-based gaming and e-commerce company Sea to publish its game titles in Southeast Asia as the Chinese tech giant looks to the international market amid stalled growth at home.
The deal grants Garena, Sea’s digital entertainment arm, the right of first refusal to publish Tencent’s mobile and PC games in Indonesia, Taiwan, Thailand, the Philippines, Malaysia, and Singapore for five years, according to a statement issued on Monday by Sea.
“Garena operates across some of the fastest-growing markets globally and has a deep understanding of the dynamics in these regions. Our long-term partnership and collaborations with Garena on key titles have been successful, and we are glad to further deepen our strategic partnership through this arrangement,” Martin Lau, president of Tencent, said in the statement.
Sea, backed by Tencent which first invested in the company in 2010, operates Southeast Asia’s biggest gaming platform with 161 million quarterly active users as of the second quarter of 2018. Garena is already selling Tencent’s most popular games on its platform including Arena of Valour, the international version of Tencent’s blockbuster game Honour of Kings, and League of Legends.
The partnership comes as growth in China’s gaming industry has stalled after a halt in the game approval process and a tightening regulatory environment at home, leaving developers and publishers eager to explore overseas opportunities.
China’s gaming industry has been coping with a hiatus in the approval of new games since March due to a regulatory reshuffle, and broader calls from Beijing for gaming companies to do more to protect the nation’s youth from online addiction and myopia. In August China’s Ministry of Education announced a plan to curb the number of new online games and limit playing time in an effort to protect the eyesight of children.