APTnovel Chapter 490 Tencent's Strategy
Chapter 490 Tencent's Strategy
The large conference room on the top floor of Tencent's headquarters was filled with people again after two days.
This time it was even more crowded than last time, with two administrative clerks even standing at the door taking meeting minutes.
More than a dozen department heads sat on either side of the long table, from strategic investment to gaming business to cloud computing to legal affairs; almost everyone from the core departments was present.
The seat at the far end of the long table was empty; it was reserved for the chairman.
After everyone else was seated, no one spoke, and even the sound of flipping through the documents was kept to a minimum.
A few minutes later, the meeting room door was pushed open.
The chairman's surname was Ma. He was in his early sixties, wearing a dark gray Zhongshan suit. His hair was gray, but he was in good spirits and walked with a very straight back.
He sat down at the very back, glanced around at everyone in the meeting room, then opened the printed agenda on the table and closed it again.
"We won't be following the agenda today." His voice wasn't loud, but the composure characteristic of a seasoned decision-maker instantly silenced the entire meeting room. "Today, we mainly want to hear everyone's thoughts. I've already read the summary report on TUTU, and everyone knows about it. The situation we face now is—a small company that was initially at a complete disadvantage in terms of channels and entry points has, within a month, established an alliance network covering three high-frequency tracks: shopping, food delivery, and short videos through technological cooperation and equity swaps. We didn't foresee this situation. Now, we need to discuss how to respond."
After he finished speaking, he leaned back, indicating that everyone was free to speak.
The deputy director of the strategic investment department was the first to speak. His attire and expression were similar to the last meeting, but his speech was noticeably more concise: "Chairman Ma, let me start with the channel side. Although TUTU's alliance network has a wide coverage, it hasn't yet formed a true closed-loop ecosystem. JD.com, Ele.me, and Kuaishou/Douyin operate independently, without deep business synergy. TUTU is currently only binding them together through equity and AI technology, but the mutual traffic redirection, user profile sharing, and joint marketing systems among the three companies haven't been established. If we can create gaps or conflicts of interest among these alliance companies, the network itself is not stable."
He paused for a moment, then continued, "The specific strategy can be approached from two directions. First, we need to further solidify our existing partnerships within the Tencent ecosystem. Our relationships with companies like Meituan, Pinduoduo, and Didi are already very close. Now that TUTU has brought in Kuaishou, Douyin, and Ele.me, we need to ensure these core allies remain committed. We can provide them with additional traffic support and commercialization resources to further improve their revenue stability. Second, we need to initiate acquisitions and build a reserve of small and medium-sized companies, especially new companies that already have a certain user base in their niche markets but haven't yet aligned themselves with any particular group. By bringing these scattered potential forces under our control, TUTU will have far fewer targets to recruit."
Sitting next to him was the head of the business development department, a middle-aged man in his early forties with short-haired hair. He habitually tapped his fingers on the table as he spoke: "Let me add something about the acquisition. We've been screening targets for the past two months and have listed over a dozen companies that meet our requirements. We're mainly focusing on two areas—lightweight social entertainment applications and small platforms with stable user bases in specific vertical sectors. We've already contacted several companies, and they're very interested in Tencent's size and resources, with strong acquisition intentions. If we accelerate the process, we can acquire at least three to four companies this year, covering areas from social to tools, content, and even some educational scenarios. Even if TUTU manages to attract the existing large platforms, they still can't compete with us in terms of long-tail coverage."
Some have offered a different perspective: "I agree with acquiring companies. But the issue lies in the management and integration costs after the acquisition. Historically, the proportion of small and medium-sized companies we've acquired that have truly integrated into Tencent's ecosystem and generated synergies hasn't been high. Often, money was spent, teams were brought in, and businesses were merged, but the product logic and operational rhythms of the two sides didn't align, ultimately leading to each operating independently. If the acquisition is rushed simply to block TUTU's path, the returns may not be as expected."
Just as the head of the business development department was about to respond, the chairman spoke first, raising a hand in a gesture that made the man swallow his words.
After a moment of silence, the chairman said something that instantly drew everyone's attention in the conference room: "The directions I just mentioned—acquisitions and strengthening alliances—are all correct, but they are all tactical responses. I want to ask everyone a more fundamental question—how was TUTU able to accomplish all of this in such a short time?"
A moment of silence fell over the conference room. Someone hesitated before speaking, "Because of the AI technology they have?"
The chairman nodded: "Yes. Because they possess a set of technological assets that we haven't been able to fully assess yet. We've spent a lot of effort negotiating with them on the levels of channels, entry points, and capital, but what truly tipped the scales was that technological variable."
He paused, picked up his thermos from the table, took a sip of water, and continued, "So what I'm trying to say is—besides defense and acquisitions, we also need to do one more thing: find new channels for cooperation with the government. Currently, China is promoting industrial policies focused on energy conservation, emission reduction, and green development. The government is continuously increasing its support for new energy, low-carbon technologies, and the sharing economy. Previously, we were considered a 'monopoly risk' target by the government because of our large size and broad business scope. If we can proactively enter new areas like energy conservation and emission reduction that align with national policy, and show the government that Tencent is not just a profitable internet giant, but also a company willing to shoulder social responsibility and promote industrial upgrading, then our passive situation at the policy level will significantly improve."
After he finished speaking, there were quiet whispers in the conference room.
Then, the Deputy Director of the Strategic Investment Department spoke first. His tone was noticeably softer than before, as if he were carefully considering the matter: "I think Chairman Ma's direction makes a lot of sense. The official attitude towards Tencent has always been rather complex. On the one hand, we are indeed contributing to the country's digital economy and infrastructure construction; on the other hand, our size and market position do indeed raise concerns among regulators. If we can proactively enter a new field that is clearly supported by the government, receives strong policy support, and is somewhat related to our existing business, it can indeed change the government's overall perception of us. The question is—from which direction should we start?"
The head of the cloud computing division spoke. He wasn't a frequent speaker at meetings, but his voice carried the calm composure of someone accustomed to working with machines: "In terms of energy conservation and emission reduction, the sharing economy is a relatively mature entry point. While bike-sharing has already experienced a boom, the market structure isn't entirely solidified, and existing users' habits can still shift. If we partner with an existing bike-sharing platform for in-depth cooperation, creating synergy in user access, payment scenarios, and data operations, we could potentially reshape the landscape of this sector within six months."
The head of the Smart Mobility Business Unit sitting next to him chimed in: "Besides shared bikes, new energy vehicles are also one of the areas receiving the most policy support. The Chinese government is vigorously promoting new energy vehicles, with subsidy policies and infrastructure construction plans in various regions. If we partner with a new energy vehicle company that has accumulated technological expertise, and leverage Tencent's cloud computing, big data, and user ecosystem capabilities to expand into the fields of connected vehicles and smart cockpits, the policy alignment and commercial prospects in this area are very promising."
Someone asked, "Which company should we specifically negotiate with? The two largest bike-sharing companies are Hello and Qingju, both quite large, and each already has its own strategic investors. If we want to get involved, should we enter through capital investment or business cooperation?"
The head of intelligent mobility thought for a moment and said, "Both approaches are viable. Capital investment is fast, but costly. Business cooperation is slower, but costs are controllable. I suggest we make some initial contact to gauge their attitude and bottom line before deciding which approach to take. There are more options in the new energy vehicle sector. NIO, XPeng, and Li Auto all have their own technological advantages and user bases, and their demand for internet ecosystem access has always been strong. If we can use Tencent Cloud's resources and user traffic as a bargaining chip, negotiations shouldn't be too difficult."
The head of cloud computing nodded: "We've had initial contact with NIO before, and they've always been interested in collaborating on connected vehicles and data intelligence. If we can discuss a more comprehensive solution with them, the progress should be faster than with bike-sharing."
The meeting room began to buzz with excitement.
Some suggest promoting shared bicycles and new energy vehicles simultaneously, while others recommend focusing resources on new energy vehicles first because the policy window is shorter. Still others suggest considering the possibilities of smart cities and intelligent logistics in addition to the sharing economy.
The various sounds mingled together, like a chessboard that had just been stirred up.
The chairman sat at the very back without saying a word.
He watched as the people in the conference room discussed amongst themselves, and only after everyone had expressed their opinions did he pick up his pen, write a few words on the paper in front of him, and then look up.
"We're pursuing two directions simultaneously. For bike-sharing, we'll first contact HelloBike to assess their current equity structure and willingness to cooperate. If the conditions are right, we'll discuss strategic investment. For new energy vehicles, we'll send a dedicated team to liaise with NIO, focusing on joint development of vehicle connectivity and data intelligence. We shouldn't just discuss capital cooperation; we need a technological partnership. If both of these directions are successful, Tencent will have two new business opportunities directly aligned with official policies. Add to that acquisitions and strengthening alliances, and overall, we have ample room for maneuver."
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