Tencent Targets TikTok Way To Drive Growth, Intensifying Rivalry With The Short Video Specialist - Tencent Holdings (OTC:TCEHY)

Chinese gaming giant Tencent Holding Ltd TCEHY saw advertising in its nascent short video platform becoming a potential revenue driver, CNBC reports.
The new focus puts it in direct competition with China's leading short video players, ByteDance's Douyin, the Chinese cousin of TikTok and Kuaishou Technology KUASF.
Tencent's foray into a short video is relatively new and looked to step up the challenge to Douyin and Kuaishou.
Also Read: Amazon Succumbs To TikTok Fever After Meta, YouTube
Revenue from short-form video accounts for around 39% of China's total digital ad revenue, marking the most significant single ad revenue category ahead of categories like social networking and news.
Tencent reported its first ever year-on-year quarterly revenue decline due to gaming business headwinds.
China's sweeping tech crackdown, Covid's resurgence, and the subsequent economic weakness has weighed on the company.
Tencent and the other leading gaming giants failed to make it to China's final cut for gaming licensing. As a result, it explored alternative avenues like overseas expansion, electric vehicles, and metaverse to drive growth.
Tencent devoted a significant part of the earnings call explaining the potential of video ads and their importance to the revenue stream.
Tencent saw video ads eventually grow into a substantial revenue source over time.
Tencent acknowledged e-commerce live streaming as an "opportunity," but it "will take some time."
Tencent aims to build awareness of the video product, then onboard merchants and advertisers.
Price Action: TCEHY shares closed higher by 3.89% at $39.80 on Wednesday.

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