Tencent Holdings Limited

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Tencent Holdings Limited
History of Tencent Holdings Ltd.
Tencent Holdings Ltd. is one of the Chinese world-leading technology and Internet companies. In particular, it was established in 1998, and its headquarters is in Shenzhen, China. The firm deals with Internet-related products and services, including artificial intelligence, instant messaging, online games, interactive entertainment, e-commerce, payment systems, music, and web portals. The guiding principle for Tencent is the proper utilization of technology (Tencent.com). The company has significantly invested in video games, making it among the largest firms in that industry. Tencent Interactive Entertainment Group (IEG) is the company's subdivision that deals with online games' publications. In 2004, the firm was listed on Hong Kong’s Stock Exchange. In 2018, Tencent’s market value surpassed $500 billion, making it join the likes of Apple Inc., Amazon.com, and Facebook in market capitalization (Kharpal). Proper leadership and management of resources has enabled Tencent to be successful in the technology sector. Due to the rapid growth and expansion, Tencent has become among the most traded corporations in China. Fast Company and the Boston Consulting Group ranked Tencent among the fifty most innovative and creative companies globally. In addition, the firm continues to look for new areas of investment so that it can penetrate new countries and territories.
Tencent’s Business Strategy
Tencent’s business strategy entails increasing consumer engagement on the Internet by providing innovative products and services. For instance, in 2011, the company introduced WeChat, which is a smartphone app that promotes instant messaging. After around a year from the time WeChat was established, it already had 100 million registered and active users (Ren & Heinrich). In 2013, WeChat established WeChat Pay, which enabled individuals to link their bank accounts so that they can receive and send money to other app users. In 2018, WeChat had over 1 billion users and over 1 billion Yuan transactions (Ren & Heinrich). In addition, Tencent acquires technology startups in different parts of the world. The company is well-positioned, and its disciplined execution of business operations makes its business strategy sustainable in the long term. The primary areas that have made Tencent continually grow and expand worldwide include online games, instant messaging, travel, and e-commerce. The firm uses vertical supply chain integration.
Business Challenges
Tencent has not made a significant success without encountering numerous challenges in both the domestic and international markets. Some of the issues the company is facing emanate from stock price fluctuation, mergers and acquisition, geopolitical problems, disposition actions or rumors, and product failures. For example, video-game mergers and acquisitions in the international market is a highly competitive fields, which is the primary issue that the firm has been encountering. Many technology companies in the world are searching for startups to acquire to gain competitive advantages in the gaming industry, which is highly profitable. Tencent...