ByteDance, the tech giant from China and parent company of Marvel Snap publisher Nuverse and TikTok, is going through a major restructuring in its video games sector and is winding down the gaming division as part of the restructuring process. The company is planning to withdraw from the gaming industry, a move that will potentially leave hundreds unemployed.
Marvel Snap Might Be at Risk with a Major ByteDance Restructure
ByteDance started making its way into the video games industry in the last few years as it bought several studios and exclusive distribution rights to titles to create a name for itself in the sector. The company launched Nuverse in 2019, and it was seen as a major push in the video game industry by the TikTok owner as it posed tough competition for its domestic rival Tencent Holdings, which also happens to be one of the biggest gaming companies in the world.
However, it hasn’t been going as planned, as a ByteDance spokesperson said in a statement to Reuters that the company is restructuring the video game business after a review. The spokesperson familiar with the matter stated:
We regularly review our businesses and make adjustments to center on long-term strategic growth areas. Following a recent review, we’ve made the difficult decision to restructure our gaming business.
Although the spokesperson did not give any further information, they stated that ByteDance would retreat from the video game industry and stop working on any unreleased games. The sources added that employees will be informed on Monday to stop working on these games by December.
The TikTok maker is also looking to divest from already-launched games like Marvel Snap. This will likely result in hundreds of employees being laid off, and they might learn about this by the weekend.
A tech website, 36Kr, has claimed that nearly 700 employees across the gaming business at ByteDance will be affected by this restructuring, and two under-development game projects have already been terminated. The Chinese tech giant behind popular short video platforms TikTok and Douyin also has no plans to return to the gaming industry in the future, the sources stated.
This is one of the biggest retreats from the gaming industry, as the company was seen as a major rival to Tencent Holdings and NetEase. This restructuring is also said to be a result of the company’s failure to take a significant market share from Tencent Holdings. The sources also stated that ByteDance’s casual games brand, Ohayoo, whose games feature on Douyin, the sister app of TikTok in China, and casual games on TikTok will not be affected by this restructure.
However, this can impact developer and publisher Nuverse behind some of its popular titles, including Crystal of Atlan and Marvel Snap. Marvel Snap is a digital collectible card game developed by US studio Second Dinner that was released last year, and although it did not do very well commercially, the game garnered a cult following.
Marvel Snap also won ‘Best Mobile Game‘ at The Game Awards 2022. Crystal of Atlan is an action-role-playing mobile game that was very well received by the players when it debuted.
ByteDance has also been looking for potential buyers since earlier this month for its video game development subsidiary, Shanghai Moonton Technology Co., behind the popular title Mobile Legends: Bang Bang, which it acquired for $4 billion in 2021. The company recently overhauled its Virtual Reality division, Pico, and laid off employees from the team.
There have been several job cuts across the video game industry in 2023 as major companies such as Epic Games, Xbox Game Studios, Riot Games, Sony, Blizzard, and many others have been affected by layoffs, leaving thousands unemployed. This move will be beneficial for companies like Tencent and NetEase, which have already been enjoying success in the gaming industry.
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