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ByteDance’s efforts to level-up in gaming have been met with challenges, but casual gaming remains a bright spot for the company. Photo: AFP

TikTok maker ByteDance launches a new casual game store and indie publisher to take on Tencent and NetEase

  • The mobile game store Danjuan Games and indie publisher Pixmain represent a renewed focus on less complex games for ByteDance
  • The social app giant has struggled with mid-core games Art of War: Infinity Evolution and JJ Street Basket in its effort to take on its Chinese rivals
Video gaming

With the recent launch of a new casual gaming platform and independent games publisher, TikTok maker ByteDance is continuing a push into an entertainment segment in China long dominated by competitors Tencent Holdings and NetEase.

In October, ByteDance launched a new mobile-only game store called Danjuan Games, which is currently full of casual titles like puzzle games and simple side-scrollers. Then just this month, the company unveiled a new publishing arm called Pixmain at the WePlay Game Expo in Shanghai. It currently has five independently developed (indie) games in the pipeline, all of which will be available on mobile. Three will also be released for PC and one, Grimvalor, will get a version for Nintendo Switch.

ByteDance has been rapidly expanding its gaming operations in recent years as it seeks new ways of monetising the attention of its users. The company appears to be following a path similar to that of Tencent, which paired social media and video games in China with very lucrative results, according to analysts.

“ByteDance also has an advantage with Douyin and TikTok as it is able to acquire users in a similar way to how Tencent does with WeChat and QQ,” said Zeng Xiaofeng, vice-president of game consultancy Niko Partners.

Danjuan and Pixmain join the three game studios that ByteDance has already launched: Nuverse, PixDance and Ohayoo.

While Ohayoo is also focused on casual games – usually free, easy-to-play mobile games like Candy Crush – Nuverse and PixDance focus on mid-core and hardcore games of varying complexity. Mid-core games require more effort than casual ones while hardcore games are often big, competitive titles. It is the difference between Supercell’s Clash of Clans and Tencent’s Honour of Kings.

ByteDance brushes off early failures with new attack on gaming king Tencent

“ByteDance is heavily investing in each part of the video game industry value chain to solidify its presence as a major player in the games market,” Zeng said. He added that this includes self-developed games, acquiring studios, licensing third-party content and building a community through its own distribution platforms.

To help take on China’s current gaming giants, ByteDance has been going on a hiring spree this year. Most recently, the company put up job listings in September for 700 business-related positions and 200 technical positions in gaming.
However, attempts to make headway in gaming have proven challenging for the social app giant. ByteDance’s mid-core games Art of War: Infinity Evolution and JJ Street Basket have struggled to live up to expectations. The growing pains suggest the company has a ways to go before it gets a hit competitive title like Tencent’s Honour of Kings or NetEase’s Onmyoji.

Chundi Zhang, a video games analyst at Ampere Analysis, said the increased focus on casual and indie games could suggest ByteDance is finding it harder to compete with its more experienced rivals than it initially thought.

“After experiencing setbacks in publishing mid-core and hardcore games, proving that it may be difficult to [follow] the same path as Tencent or NetEase, ByteDance is carving out a path of its own in the areas of casual and hyper-casual games,” Zhang said.

How ByteDance is copying Tencent’s playbook to conquer gaming

So far, casual games have been a bright spot for ByteDance. Ohayoo, known for casual titles such as the mobile game Virus War, has become one of the fastest-growing studios in China.

Over 18 months, Ohayoo has published nine casual games that have brought in at least 100 million yuan (US$15.2 million) in revenue each, Ohayoo general manager Xu Peixiang told Chinese media outlet Youxiputao. One of those games brought in more than 600 million yuan.

“The launch of Danjuan Games is a consolidation of their business in casual and hyper-casual games, aiming to create a Steam-like platform that integrates game publishing and user community,” Zhang said. This will be key to competing with Tencent’s WeChat mini game platform, he added.

Zeng said that short videos could be another key to success for Danjuan Games, because the app promotes casual games through “TikTok-style videos”. It also drives engagement by allowing users to play games within its other apps and “earn virtual currency that can be spent across its library of titles”, he said.

ByteDance is also moving into indie games at a critical time. Recent popular titles like Fall Guys and Among Us have proven that indie games can be big business. And snatching up top indie games is a strategy that has worked for Tencent for years.

“The overwhelming success of Fall Guys in China proves that there is a growing recognition of indie games in the Chinese market, and social media has played a strategic catalytic role in this process,” Zhang said.