Tencent’s overarching plan for the future of gaming is built around three pillars: live‑service experiences, cutting‑edge AI tools, and the cultivation of evergreen titles that can thrive over many years. In a recent, in‑depth conversation with Yong‑yi Zhu, the vice‑president who oversees operations, strategy, and compliance for Tencent Games, the company’s nuanced approach was laid out in detail, revealing how the giant balances ambition with pragmatism across its sprawling global portfolio. ### Live Service as a Core Goal, Not a Sole Focus Zhu opened the interview by describing live service as the "holy grail" for Tencent.
He pointed to the firm’s DNA—blockbuster titles such as **Honor of Kings**, **League of Legends**, and **Valorant**—as evidence that games which continuously evolve and nurture communities provide a steady revenue stream and a lasting relationship with players. These titles are not merely episodic entertainment; they become part of a player’s daily routine, turning short‑term engagement into a lifestyle. However, Zhu was quick to stress that live service is only one component of a broader strategy. While Tencent continues to back high‑profile live‑service projects, it also recognizes that not every acquisition or partnership will fit that model.
The recent dissolution of the live‑service game *Highguard*, which was reportedly supported by TiMi Studio Group, illustrates that even well‑funded projects can falter if they do not align with the company’s long‑term vision. ### Strategic Partnerships and Studio Autonomy Since the last interview a year ago, Tencent has seen several of its UK studios—**Splash Damage** and **Bulkhead**—spin out as independent entities, following earlier departures by **The Chinese Room** and **Secret Mode**. Zhu explained that the decision to let studios go was based on a careful assessment of synergy. "If the partnership does not amplify the game or fit our long‑term strategy, it may be better for the studio to thrive on its own," he said.
This pragmatic stance acknowledges that cultural differences, market conditions, and divergent creative directions can make integration challenging. Zhu also highlighted that Tencent’s acquisition model is not about blanket dominance. "We sometimes encounter integration hurdles because of market shifts or cultural gaps," he admitted. "Not every deal will be a slam dunk, and that’s acceptable." ### Evergreen IPs and Sustainable Communities Beyond live service, Tencent places great importance on evergreen intellectual property—games that retain relevance over long periods, whether they are single‑player experiences or multiplayer ecosystems.
Mobile titles in the company’s portfolio often fall into the single‑player evergreen category, while larger PC and console games aim to build lasting communities. Zhu cited **Call of Duty** as an example of an evergreen franchise that evolves through successive releases while maintaining a core identity.
The ultimate aim, according to Zhu, is stability. He contrasted the volatile cycles of many premium games—where studios launch a hit, then face layoffs when the hype fades—with Tencent’s desire to provide a more consistent employment environment and steady content pipeline for its developers. ### Talent Investment and Global Collaboration A second cornerstone of Tencent’s strategy is the recruitment and nurturing of high‑quality talent worldwide. Zhu oversees roughly twenty studios across Europe, North America, and Oceania, including **Miniclip**, **Sumo Digital**, **Funcom**, **Fat Shark**, **Sharkmob**, **10 Chambers**, **Stunlock Studios**, **Digital Extremes**, and **Grinding Gear Games**.
The focus is less on geographic expansion and more on ensuring each studio receives the support it needs to launch successful products. Support can take many forms: regional publishing expertise, technical assistance, backend infrastructure, testing, and data analytics. Zhu described a concrete example from **Funcom’s** *Dune Awakening*, where experts from both China and Europe worked side‑by‑side with the development team to troubleshoot engine issues and refine gameplay. In some cases, these external specialists transition into permanent staff if the collaboration proves valuable.
Creative direction generally remains in the hands of the individual studios, but Tencent steps in on cross‑studio challenges—such as optimizing Unreal Engine pipelines or navigating publishing in the MENA region or Southeast Asia. This hybrid model allows studios to retain their artistic voice while benefiting from Tencent’s massive operational muscle.
### Size Does Not Dictate Viability When asked whether Tencent only backs large‑budget projects, Zhu refuted that notion. While some industry observers claim the company avoids games under £50 million, Zhu clarified that Tencent evaluates opportunities across all scales. "It’s about where the studio is on its journey and what its ultimate destination might be," he explained.
The portfolio already includes smaller titles, and the firm remains open to nurturing them, provided there is a cultural and strategic fit. He cited **Larian Studios** and **FromSoftware**—both minority‑stake partners—as "north stars" that demonstrate how modest‑sized projects can evolve into enduring franchises through careful craftsmanship and audience building.
### Cross‑Regional Integration and Outsourcing Strategies Zhu acknowledged that attempts to tightly integrate Tencent’s Western and Chinese arms have progressed slower than hoped, largely due to time‑zone challenges. Instead, the focus has shifted toward disseminating best practices across the network.
One emerging model involves small core teams augmented by external vendors, a method that proved successful for titles like *Star Wars: Galactic Racer* and the upcoming *Expedition 33*. Outsourcing decisions are guided by geography, cost, and expertise.
For European studios, Tencent may lean on its UK‑based **Sumo Digital** for proximity, while recognizing that the UK can be expensive. The company balances these trade‑offs, aiming to keep critical talent in‑house while leveraging specialized external resources when needed. ### The Rise of Chinese Development and AI Adoption During Gamescom, a noticeable surge of polished Chinese games signaled a potential shift in industry power dynamics.
Zhu expressed optimism, noting that Chinese developers who mastered high‑quality mobile experiences are now applying those standards to console and PC titles. This evolution is accelerated by better tooling, particularly AI‑driven solutions. Zhu emphasized that AI at Tencent is viewed as an enhancer, not a replacer. By integrating AI into concept art, rigging, motion matching, code review, and even production‑management bots, smaller teams can punch above their weight, delivering higher‑quality content without expanding headcount dramatically.
He stressed that AI should be treated as a genuine tool—akin to the internet—rather than a threat. The company remains vigilant about copyright concerns surrounding generative AI. Tencent restricts AI training data to internally owned assets, ensuring that any AI‑generated output is derived from its own IP and does not infringe on external creators.
Agreements with tool providers further safeguard data, preventing accidental leakage of proprietary assets. ### Looking Ahead With the backing of its massive parent corporation, Tencent Games is uniquely positioned to experiment across a spectrum of investments—from large‑scale AAA studios to niche indie developers.
Although recent moves have seen the company step back from **Bulkhead** and **Splash Damage**, it simultaneously announced a minority stake in **W4**, the commercial partner behind the open‑source Godot engine. Zhu concluded that, regardless of the delivery model, the central mission remains constant: keep players engaged and entertained.
"When players love a game, they keep playing, and that translates directly to the bottom line," he said. This focus on sustained engagement—whether through live‑service updates, evergreen franchises, or AI‑enhanced development pipelines—defines Tencent’s long‑term strategy in the ever‑evolving gaming landscape.