Report: Meta Looks to Tencent to Relaunch Business in China

Meta has reportedly turned to China’s Tencent to resurrect its business in that country.

A potential roadblock to the tech giant’s efforts, however, could be its CEO’s apparent views on China, The Wall Street Journal reported Monday (July 3).

Sources tell the newspaper that Meta’s efforts — to sell its Quest virtual reality headsets in China — face an obstacle, in part because executives there are concerned Mark Zuckerberg isn’t seen as being friendly to the nation.

For example, Zuckerberg has accused China of stealing technology, criticized TikTok owner ByteDance and refused to comply with the government’s censorship rules. This could create uncertainty if the company and Tencent were to pursue licenses and approvals in China.

PYMNTS has contacted Meta and Tencent for comment but has not yet received a reply. The WSJ report notes that a partnership could benefit both Tencent — the largest video game publisher in the world — and Meta, which could tap the Chinese market to recover some of the billions it has spent on its metaverse project.

The news follows last week’s announcement by Meta of a new subscription service for games on its virtual reality (VR) headsets.

Subscribers will get access to two titles per month that can be redeemed on the internet, in a headset or via the Meta Quest app.

PYMNTS wrote in March that Meta had sold about 20 million of its $400 Quest 2 headsets since 2020 and had slashed the price of the Quest Pro, its premium device, from $1,500 to $1,000 amid lackluster sales.

The VR industry was apparently more excited about the impending launch of Apple’s mixed-reality Vision Pro headset.

As noted here earlier this month Tipatat Chennavasin, co-founder of the Venture Reality Fund, called the Apple headset “the next ecosystem where millions of developers are making millions of dollars selling to billions of people.”

However, that project too has run into roadblocks, according to reports Monday that Apple had lowered its production forecast for the headset and paused plans for a more affordable version of the $3,500 device.

“Apple’s fan base and others who can afford Vision Pro’s hefty price tag may be waiting for the product’s eventual launch, but it is too soon to say if the broader consumer population will buy in,” PYMNTS wrote last month.

“Given the similar concerns about high consumer costs for Vision Pro’s predecessors — and their relatively low costs in comparison to Apple’s offering — the wearable prospects for future success are murky, even though many of the augmented reality innovations stemming from these wearables could have real-world benefits.”