In August, two apps operated by Shenzhen-based tech giant Tencent, including interactive search engine Sogou.com and personalized information product Kandian, were officially shut down. According to incomplete statistics from Chinese media outlet Spiral Lab, up until August this year, roughly 10 well-known products or applications have been officially given up by Tencent.
The report shows that the pace of Tencent‘s product suspensions has accelerated significantly this year.
|Application||Field||Launch Date||Suspension Date|
|QQ Tang||Game||December 29, 2004||April 20, 2022|
|Xiao’e Pinpin||E-commerce||April 29, 2020||April 30, 2022|
|Sogou Map||Map||1999||May 15, 2022|
|Penguin E-Sports||Game Live-streaming||July 26, 2017||June 7, 2022|
|VUEVlog||Video Editing||June 5, 2016||June 30, 2022|
|Kandian Kuaibao||Personalized Information||June 1, 2015||July 18, 2022|
|Sougou.com||Search Engine||May 8, 2014||August 9, 2022|
|Kandian||Personalized Information||November 18, 2019||August 16, 2022|
|WeGame||Game Community||September, 1, 2017||September, 8, 2022|
|(Source: Spiral Lab)|
The suspensions began in April. QQ Tang, a game that has been in operation for more than 17 years, officially ceased operations on April 20. On April 30, Xiao’e Pinpin, a social e-commerce project of Tencent, was officially shut down after just two years of operations. Xiao’e Pinpin may have been one of the e-commerce projects with the largest internal investment from Tencent in recent years, sources said.
Some of Tencent‘s acquired projects are now facing a similar fate. In September last year, Sogou announced its completion of a privatization deal, becoming an indirect wholly-owned subsidiary of Tencent. However, after joining Tencent, many of Sogou’s businesses and projects were gradually abandoned. In addition to the Sogou Search app, Sogou Map has officially been offline since May.
VUE, a video editing software acquired by Tencent for $50 million in 2020, also announced on June 30 this year that it would stop new user registrations, membership recharge services, and other functions.
Tencent‘s gaming sector is also gradually cutting some products. Mobile platform Penguin E-Sports officially ceased operations on June 7. Tencent‘s game community platform WeGame has also stopped new user registrations since July 5, and will shut down its servers on September 8.
According to Spiral Lab, many of Tencent‘s products that have been shut down this year have not been completely forgotten by users. Through the business closures, Tencent may have more energy to focus on the development of key products. Some products abandoned by Tencent this year may ultimately prove less important than others.
In the first quarter of this year, Tencent’s net profit was 25.545 billion yuan ($3.77 billion), down 23% year-on-year. This also marked the third consecutive quarterly decline, showing obvious financial pressure. “We will continue to control costs, and cost optimization is for long-term development. There is clear focus for optimization,” Martin Lau, the president of Tencent, said during a Q1 earnings call.
Spiral Lab believes that online videos and enterprise services are both areas that Tencent attaches great importance to and are expected to generate a positive cash flow for Tencent in the future. In the long and medium videos field, Tencent Video has gradually led iQIYI and Youku. Meanwhile, WeChat’s short video and livestreaming platform WeChat Channels has also witnessed great growth this year.