Inside Tencent's Long-Term Strategy: Live Service, AI Tools, And Evergreen Titles

In a wide-ranging discussion on Tencent's long-term strategy, Yong-yi Zhu, the vice president and head of operations, strategy, and compliance at Tencent Games, highlighted the critical role of live-service and evergreen titles. While several industry players have faced setbacks in the live-service sector, Zhu described these recurring-revenue games as the company's "holy grail." He pointed to established titles like Honor of Kings, League of Legends, and Valorant as examples of games that build communities and provide long-term stability for studios, effectively becoming a lifestyle for players.

Despite this focus, Zhu clarified that live-service is not Tencent's sole pursuit. The company's strategy heavily incorporates "evergreen" intellectual properties, which can include single-player mobile games or serialized premium franchises like Call of Duty. The ultimate objective is to establish sustainable, long-term communities and bring consistency to the business, avoiding the volatile cycles of game launches and subsequent layoffs that have plagued other premium game publishers.

The conversation also touched upon Tencent's evolving portfolio and its relationship with various studios. Over the past year, several UK-based developers, including Splash Damage, Bulkhead, The Chinese Room, and Secret Mode, transitioned to independence. Zhu was sanguine about these separations, admitting that Tencent sometimes faces integration challenges due to cultural differences or market conditions. He emphasized that partnerships must make sense for both sides, and if Tencent cannot help amplify a studio's game or if there is a lack of synergy, independence is often the better path.

Zhu, who oversees around 20 global studios including Miniclip, Sumo Digital, Funcom, and Grinding Gear Games, explained that his current focus is on ensuring successful upcoming launches rather than geographic expansion. Tencent supports these studios by offering expertise in regional publishing, technical troubleshooting, and backend services. For instance, experts from China and Europe were deployed to assist Funcom with Dune Awakening, a game scheduled for a console release on September 22, following its 2025 PC launch.

Addressing industry perceptions, Zhu disputed claims that Tencent ignores projects with budgets under 50 million pounds. He asserted that the company evaluates games of all scales based on where a studio is in its development journey. He cited minority-stake investments in Larian Studios and From Software as "north stars," noting that both have successfully built up their craft and audiences over time through purposeful, and not always massive, projects.

Finally, Zhu discussed the integration of artificial intelligence in game development, urging Western developers not to fear the technology. He framed AI as an inevitable tool, akin to the internet, that enhances efficiency rather than replacing human workers. Within Tencent, AI is encouraged for tasks like concept art, rigging, motion matching, code review, and production management, allowing smaller teams of 30 to 40 people to iterate faster and produce higher-quality content.