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ByteDance’s TikTok app logo is seen in this photo illustration taken August 22, 2022. Photo: Reuters

China’s Tencent, ByteDance defy headwinds at home to dominate global app revenues in first half

  • In the video game segment, Tencent pulled in US$2.6 billion in the first half alone, accounting for almost 10 per cent of the entire US$27 billion gaming app market
  • While the top 1 per cent of firms still wield outsize influence in mobile games, their dominance has weakened over the past three years, says SensorTower

Tencent Holdings and ByteDance were the world’s top-ranked companies by app revenue in the first half of 2022, according to a new report, proving that Big Tech in China still wields global market power despite regulatory headwinds and an economic slowdown at home.

A research note by mobile market intelligence service SensorTower found that Shenzhen-based Tencent was the top earner among both game and non-game publishers, grossing about US$4.4 billion in revenue over the six-month period thanks to hit video games such as Honour of Kings and PUBG Mobile.

Beijing-based ByteDance was second with US$1.3 billion generated in the first half thanks to the popularity of its global hit short video app TikTok.

More than 91 per cent of Chinese netizens use short video apps, survey finds

In the video game segment, Tencent pulled in US$2.6 billion, which accounted for almost 10 per cent of the entire US$27 billion gaming app market.

SensorTower’s data also showed just how much the big players dominate the games market, with the top 1 per cent – equal to 460 companies – accounting for 93 per cent of the total market, leaving the other 46,000 companies to fight over the remaining US$1.9 billion.

The SensorTower report covered 900,000 worldwide game and non-game app makers. The top 1 per cent had a total of 72 billion unique worldwide installs across Apple’s App Stores and Google Play in the first half, representing 79 per cent of global total installs. The remaining 99 per cent of publishers shared the other 21 per cent of app installs.

In this photo taken November 20, 2020, a smartphone user plays Tencent’s PUBG mobile game. Photo: AFP

However, while the top 1 per cent still wield outsize influence in the mobile games world, their dominance has weakened over the past three years, said Justin Cruz, a mobile insights analyst at SensorTower.

Coinciding with that trend was a decline in mobile app adoption and consumer spending, due to global inflation and economic woes, which saw companies like Netflix and ByteDance diversify into the gaming market, SensorTower said.

Separately, increased regulatory scrutiny and unpredictable licence approvals for new titles in their home market have forced Chinese game developers to explore opportunities abroad. For example, Tencent has increased its minority stake in French game developer Ubisoft while NetEase acquired Quantic Dream last month – after both companies failed to receive approval from Beijing for new titles.