Tencent was apparently working on its own VR hardware, but plans have reportedly been ditched after growing disinterest in the metaverse space.
According to a report from Reuters, Tencent is abandoning all plans it had for VR hardware, in part to cut costs due to global economic difficulties. The report notes that the tech giant and games publisher intended to develop both VR software and hardware as part of an “extended reality,” or XR unit, it opened last year. This XR unit hired nearly 300 people, but these employees have apparently been advised to look for other work.
A source Reuters spoke with claimed that the XR project wasn’t expected to be profitable until at least 2027, based on an internal forecast. “Under the company’s new strategy as a whole, it no longer quite fit in,” this source told Reuters.” Another source noted there was also a lack of promising games and non-gaming applications.
Tencent’s interest in VR came from general rising interest in metaverses and virtual worlds, leading it to push more into hardware, despite being more in the software space with games and social media apps. One source told Reuters that Tencent had looked into VR around seven years ago, but because of advances in VR hardware, the company started to regain interest in 2021. The Meta Quest headset being so successful was also a factor in this interest.
Over the last few years, Tencent has made a number of acquisitions in the gaming space, buying a larger stake of Elden Ring developer From Software last August, and also upping its ownership stake in Ubisoft to 11% last year. It also confirmed its intentions to buy more global studios outright last October, mostly because of regulatory struggles in its native China.
Sony will be launching its PlayStation VR 2 next week, and in GameSpot’s PlayStation VR 2 review, Tamoor Hussein wrote, “But much of what it offers can be found on cheaper devices like the Quest 2, which has the added benefit of being standalone and wireless. For enthusiasts–and people willing to push through motion sickness, like me–it’s very impressive hardware that needs more software to actually impress them.”