Chinese tech giant Tencent Holdings is reportedly in talks with Meta Platforms Inc to distribute its Meta Quest line of virtual reality (VR) headsets in China. The discussions began last year and have continued in recent months, according to sources with direct knowledge of the matter. The talks are still at an early stage, and details have not been agreed upon.
Both Tencent and Meta have declined to comment on the matter, and the sources spoke on condition of anonymity as the talks are not yet public. However, Chinese media outlet 36Kr and the Wall Street Journal have both reported on the discussions.
Tencent, the world's largest video game publisher, had ambitious plans to build virtual reality software and hardware at an "extended reality" XR unit it launched in June 2022.
However, last week Reuters reported that Tencent had decided to quit developing its own XR hardware due in part to profitability issues, and had told most employees in the unit to find opportunities elsewhere. Tencent said it was making adjustments to some business teams as development plans for hardware had changed.
Tencent's main rival in China's virtual reality space is ByteDance, the owner of social media platform TikTok, which also owns VR headset manufacturer Pico.
Tencent is best known for its suite of games and social media applications, but it also sells the Nintendo Switch console in China through a partnership with the Japanese gaming firm established four years ago.
The potential partnership with Meta Platforms Inc could allow Tencent to expand its reach in the VR market and offer its customers a wider range of products. However, it remains to be seen whether the talks will result in a formal agreement between the two companies.
(Edited by : Soham Shetty)
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