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Tencent Creates Metaverse Unit

 XR unit a rare venture into hardware for the Chinese tech giant

China’s Tencent Holdings announced the launch of a “extended reality” (XR) subsidiary to its employees on Monday, formally putting its bets on the metaverse notion of virtual worlds.

The unit is in charge of growing Tencent’s extended reality business, which includes both software and hardware. It will be overseen by Tencent Games global chief technology officer Li Shen, and will fall under the company’s Interactive Entertainment business group.

Extended reality refers to immersive technologies such as virtual reality and augmented reality that serve as the metaverse’s building blocks. Tencent’s XR subsidiary is expected to eventually employ about 300.

HQQ Wallet is a Tencent FinTech product. (Tencent)

Since Facebook founder Mark Zuckerberg changed the company’s name last year to Meta Platforms Inc. and declared that he will commit the future of his firm to developing a metaverse, investors, entrepreneurs and established tech giants around the world have flocked to the “m” word.

Not familiar with the metaverse? Here’s a handy definition: It’s a “digital reality that combines aspects of social media, online gaming, augmented reality (AR), virtual reality (VR), and cryptocurrencies to allow users to interact virtually,” said.  “Augmented reality overlays visual elements, sound, and other sensory input onto real-world settings to enhance the user experience. In contrast, virtual reality is entirely virtual and enhances fictional realities.

Companies ranging from Microsoft to Disney have indicated that they are developing their own metaverses, with Chinese and American companies ranging from TikTok owner ByteDance to Apple expanding XR headset units.

Tencent is best known for its game suite and social networking software applications, so the XR unit will be a rare venture into hardware for the company

Tencent founder and CEO Pony Ma initially underlined the importance of the metaverse, or what he referred to as a “all-real internet,” in late 2020.

Tencent’s digital content offerings include a movie unit. (Tencent)

The launch of the new team contrasts with downsizing at other parts of Tencent, which has been adopting cost-cutting measures and scaling back non-core activities, such as the closure of its Penguin Esports unit to deal with the consequences of a regulatory crackdown.

Tencent told investors in November that it has a lot of “tech and capacity building blocks” to address the metaverse opportunity, but didn’t elaborate at the time.

“The driving force [of metaverse] will still be software-driven and the technology that really helps us to provide the user experience …,” Martin Lau, president of Tencent, said then.

Produced in association with MetaNews.

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