Tencent to Form Extended Reality Unit as Metaverse Race Speeds Up


  • The unit will be the extended reality business for Tencent, including both software and hardware.
  • Tencent Games Global’s Chief Technology Officer will lead the unit.
  • The unit will have over 300 staff.

China’s Tencent Holdings has announced forming an extended reality or XR unit, placing its bets on the metaverse concept of virtual worlds.

The news was announced by Reuters on Twitter:

According to the sources, the unit is building the extended reality business for Tencent, including software and hardware. Also, it will be led by Li Shen, Tencent Games Global’s Chief Technology Officer, and will be part of the company’s Interactive Entertainment business group.

As per two sources, over 300 staff will be there in the unit, which shows Tencent is cost-cutting as well as slowing hiring. However, hiring plans are still fluid since the organization will adjust the unit’s headcount on the basis of its performance.

The unit was initially formed earlier this year but was kept secret. Extended reality refers to immersive technologies like virtual reality and augmented reality, the building blocks of the metaverse.

The XR unit will mark a rare foray into hardware for Tencent, popular for its software like its suite of games and social media applications.

According to one of the sources, the unit was viewed internally as a passion project of Pony Ma, Tencent’s founder and chief executive, since he first highlighted the importance of the metaverse.

The introduction of the new team is in contrast to downsizing taking place in other parts of Tencent, which remains cost control measures and scaling back non-core businesses.

Tencent has always been reluctant about its metaverse plans. Last November, it told analysts about having a lot of tech and capability building blocks; however, it skipped from sharing the details.