Tencent Collaborates with Sea to Release Games in Southeast Asia

The Chinese internet giant Tencent wants to get its games via the Singapore-based company Sea on the market in Asia, as this is not possible due to stricter rules in the home country.

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Harsher times are breaking in the Chinese gaming and social media market. Now, Tencent Holdings plans to accelerate expansion into other countries and regions. For this purpose, Tencent Holdings Ltd. has long-term cooperation in publishing with Sea Ltd. agreed. The agreement was signed between Tencent Holdings and Garena, the digital entertainment arm of Sea Ltd.

The agreement between the two has a term of five years and gives Sea entertainment division Garena the first right to publish games in Taiwan, Thailand, the Philippines, Malaysia, and Singapore. Sea previously issued Tencent games Arena of Valor and League of Legends.

“Garena operates across some of the fastest-growing markets globally and has a deep understanding of the dynamics in these regions. Our long-term partnership and collaborations with Garena on key titles have been successful, and we are glad to further deepen our strategic partnership through this arrangement,” Martin Lau, president of Tencent, said in the statement.

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Tightened supervision in China

Authorities in China have tightened the supervision of the game industry. The country wants to have control over cultural policy. China has frozen the approval process of new games. Earlier, “inappropriate and vulgar” games were banned. Because of the measures, Tencent has not yet managed to make real money with popular games like Fortnite and PlayerUnknown’s Battlegrounds.

For the time being, Tencent decided to ‘stick off’ the stricter rules by Peking, also because the group is not entirely dependent on the revenues of its gaming division. The future of about seven thousand games is now uncertain.

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Tencent looks to Southeast Asia

In 5 years, the intimacy of Garena and Tencent’s collaboration produced many good results and profits, which can be proven by the success of publishing a number of the most successful games from Tencent’s portfolio in its core market. Some of the popular games include the Arena of Valor and League of Legends.

The two companies intend to work together to identify strategic opportunities to distribute and promote the top titles of Tencent portfolios in relevant markets, said the two companies in a press release.

Sea as the parent of Garena itself is based in Singapore and registered on the New York exchange. Garena is also the parent of the Shopee e-commerce platform in Indonesia, where some time ago Shopee and Garena AOV Indonesia collaborated on ANC Grand Final season 2 performances in Bandung.

The gaming market in Southeast Asia is under strong growth and is expected to grow from today’s $4.4 billion to $7.5 billion in 2020, according to analyst Niko Partners.

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