Tencent’s strategic roadmap is built around three pillars: the expansion of live‑service experiences, the deployment of advanced AI tools, and the cultivation of evergreen intellectual property that can sustain long‑term player communities. In a recent, in‑depth conversation with Yong‑yi Zhu, Vice‑President and Head of Operations, Strategy and Compliance for Tencent Games, the company’s nuanced approach to growth and diversification was laid out in detail. For many industry observers, the pursuit of live‑service models has been a risky gamble. Sony’s recent missteps and the collapse of several high‑profile live‑service projects have reinforced the perception that recurring‑revenue games are a volatile proposition.
Yet Tencent remains steadfast in its belief that live services are the "holy grail" of modern gaming. Zhu pointed to the firm’s DNA—titles such as Honor of Kings, League of Legends, and Valorant—as proof that games that evolve over time can generate stable revenue streams while fostering vibrant, lasting communities. "These games become a lifestyle for players, not just a one‑off experience," he explained.
However, live service is only one facet of Tencent’s broader agenda. The company has been actively pruning its portfolio, allowing studios like Splash Damage and Bulkhead to spin out as independent entities when the partnership no longer adds mutual value.
Zhu emphasized that the decision to part ways is driven by strategic fit: "If the collaboration doesn’t amplify the game or align with our long‑term vision, we may conclude the studio is better off on its own." He acknowledged that integration challenges—whether cultural or market‑driven—can sometimes impede the success of acquisitions. Evergreen titles, both single‑player and multiplayer, also occupy a central place in Tencent’s plan. The goal is to nurture games that continue to engage audiences years after launch, thereby delivering consistent revenue and reducing the boom‑and‑bust cycles that have plagued other publishers.
Zhu cited Call of Duty as an example of an evergreen IP that, despite being released as successive installments, maintains a persistent player base and brand relevance. Stability and talent acquisition are the other two pillars of the strategy. Tencent aims to attract high‑quality developers whose expertise complements the company’s strengths.
Zhu oversees roughly twenty studios worldwide, ranging from European developers such as Sumo Digital and Stunlock Studios to North American outfits like Digital Extremes and New Zealand’s Grinding Gear Games. The focus, he said, is less on geographic expansion and more on ensuring each studio has the resources it needs to launch successful products. This support can include regional publishing expertise, technical assistance, backend infrastructure, and data‑driven analysis drawn from Tencent’s domestic successes. A concrete illustration of this collaborative model is the work done on "Dune Awakening" with Funcom.
Engineers and artists from Tencent’s Chinese and European teams embedded themselves alongside Funcom’s developers to troubleshoot engine issues, refine gameplay, and even transition some consultants into permanent staff when the partnership proved fruitful. While creative direction largely stays with the individual studio, Tencent steps in on shared technical challenges—such as optimizing Unreal Engine pipelines—or on regional publishing hurdles in markets like the Middle East, North Africa, and Southeast Asia.
When asked whether Tencent is shifting its focus toward larger live‑service projects at the expense of smaller, premium titles, Zhu responded that the answer varies by studio. Funcom, for instance, had already been operating the live‑service title Conan Exiles before Tencent’s investment, so the company’s support naturally leans toward that model. Conversely, other studios that attempted live service without success have reverted to their core competency of premium, single‑player experiences.
Zhu stressed that Tencent does not impose a one‑size‑fits‑all mandate; instead, it seeks to help each studio excel in the niche that best suits its DNA. The size of a project is not a hard barrier either. While some external commentary suggested Tencent only considers games with budgets exceeding £50 million, Zhu clarified that the firm evaluates opportunities across the spectrum.
"We look at where a studio is on its journey and what its ultimate destination might be," he said. "Our portfolio already includes several smaller titles, and we remain open to nurturing them if we can add value." Tencent also draws inspiration from industry exemplars such as Larian Studios and FromSoftware—both minority‑stake partners whose games have grown organically over time. These studios demonstrate that a series of purposeful, well‑crafted releases can build a loyal audience without relying on massive budgets. On the operational side, Zhu admitted that plans to more tightly integrate Tencent’s Western and Chinese arms have progressed slower than hoped, largely due to time‑zone and cultural complexities.
Nevertheless, the company is experimenting with hybrid development models that combine small, core internal teams with external specialists. This approach proved effective on projects like "Star Wars: Galactic Racer" and is being considered for upcoming titles such as "Expedition 33." Outsourcing decisions are guided by geography, cost, and the need for specialized expertise. For European studios, Tencent may leverage its UK‑based partner Sumo Digital for closer‑time‑zone collaboration, while recognizing that the UK’s cost structure may not always be optimal.
This mirrors broader industry trends highlighted by Amir Satvat at Gamescom Dev, where development talent is increasingly migrating from high‑cost regions like California to more affordable hubs across Asia. The conversation also turned to the rising influence of Chinese developers on the global stage.
Zhu expressed optimism that the success of high‑profile Chinese projects—such as "Black Myth: Wukong"—is raising the bar for console and PC quality worldwide. He noted that Chinese teams, traditionally strong in mobile gaming, are now applying their expertise to high‑end platforms, aided by improved tooling and a cultural embrace of artificial intelligence.
AI, in particular, is viewed as an enabler rather than a replacement for human creators. Tencent encourages developers to adopt AI for tasks ranging from concept art generation and rigging to code review and production management. Zhu likened AI to the internet: an inevitable, transformative technology that can boost efficiency when used responsibly. He emphasized that Tencent’s policy is to keep AI tools within the company’s own data ecosystem, ensuring that generated content does not inadvertently infringe on external copyrights.
In summary, Tencent’s long‑term plan is a balanced blend of live‑service ambition, evergreen IP cultivation, talent acquisition, and strategic use of AI. By providing studios with tailored support—whether through technical assistance, regional publishing expertise, or collaborative development models—the company seeks to maintain a steady flow of engaging experiences that keep players invested over years. As Zhu concluded, the ultimate metric remains simple: the more players enjoy a game, the stronger the financial performance, and the more sustainable the ecosystem becomes for all stakeholders.