Tencent Releases New Gaming Studio

Tencent Games opened a new studio in Orange County, which is working on a AAA console game for PlayStation 5 and Xbox Series X. LightSpeed LA will be based in Orange County, and led by Rockstar veteran Steve Martin, who held leadership roles on Grand Theft Auto 5 and Red Dead Redemption 2, among others.

Tencent Gaming Studio

Steve Martin the executive producer, explained that ushering a new era of game culture by combining world-class development with a stress-free work environment and our teams will be focused on building the highest caliber games while promoting integrity, proactivity, collaboration and creativity.

According to gamesindustry.biz, the new developer falls under Tencent's existing Lightspeed & Quantum subsidiary, which was founded in 2008 as one of the four studios within the Chinese publisher.

It will be interesting to see if Tencent can build a team to successfully create triple-A console titles, something beyond the scope of its interests to date and a very big and long-term bet in terms of returns. Though of course it has the money to take a great shot.

By revenue, Tencent is the world’s largest game publisher – their Q1 2020 financial report pointed at RMB 108 billion ($15.3 billion) in revenue in the three month period ended March 31, 2020. However, much of their growth outside of China has been fuelled by a series of acquisitions and investments, such as Supercell and PlatinumGames.

Later, Chinese games and tech firm Tencent has purchased a 20% stake in Marvelous, a Japanese publisher and developer.

Marvelous

The company spent approximately $65 million on 11.45 million shares in Marvelous, which is best known for Story of Seasons previously known as Harvest Moon and action game Daemon x Machina.

According to Bloomberg reports, that Marvelous sold 8.62 million new shares to Tencent directly, while the other 2.83 million were sold by existing shareholders Amuse Capital and Nakayama Hayao for the same price.

Marvelous plans to use the investment to expand its existing properties and launch new IP within the next three years. Also, the two companies have previously worked together on a Chinese version of Story of Seasons. Marvelous becomes the latest in a long line of games firms to sell stakes to Tencent.