ByteDance Shakes Up Gaming Division After Poor Performance

ByteDance Shakes Up Gaming Division After Poor Performance

ByteDance, the parent company of TikTok, has announced a major restructuring of its gaming division, Nuverse, after failing to achieve its ambitious goals in the highly competitive market. The move will affect thousands of employees and dozens of games, some of which will be shut down or sold off.

Nuverse was established in 2019 as ByteDance’s gaming arm, with the aim of becoming a global leader in the industry. The company invested heavily in acquiring studios, developing games, and marketing its products. However, Nuverse faced many challenges, such as regulatory hurdles, fierce competition, and high user acquisition costs. According to The Verge, Nuverse only had one game in the top 100 grossing list in China as of November 2023, and none in the top 500 worldwide.

ByteDance Shakes Up Gaming Division After Poor Performance
ByteDance Shakes Up Gaming Division After Poor Performance

ByteDance Announces Massive Layoffs and Restructuring

On November 27, 2023, ByteDance sent an internal memo to its employees, announcing a sweeping overhaul of its gaming division. The memo stated that Nuverse would focus on a few core genres, such as role-playing, strategy, and casual games, and stop working on unreleased titles that do not fit into these categories. The memo also said that Nuverse would seek to divest from some of its launched games, and optimize its organizational structure and personnel allocation.

According to TechCrunch, the restructuring will result in layoffs of up to 80% of Nuverse’s staff, which numbered around 3,000 before the announcement. The layoffs will affect employees in China and overseas, as well as in various departments, such as development, distribution, and marketing. Some of the affected employees will be transferred to other positions within ByteDance, while others will receive severance packages.

ByteDance Faces Uncertain Future in Gaming

The drastic changes in Nuverse reflect ByteDance’s difficulties in breaking into the gaming market, which is dominated by giants such as Tencent, NetEase, and Activision Blizzard. ByteDance’s gaming strategy was based on leveraging its popular social media platforms, such as TikTok and Douyin, to attract and retain users for its games. However, this approach proved to be ineffective, as most of ByteDance’s users were not interested in hardcore games, and preferred casual and short-form content.

ByteDance’s gaming woes also raise questions about its future growth prospects, as the company faces increasing pressure from regulators, competitors, and users in its core businesses. ByteDance has been fined, investigated, and banned in several countries for violating data privacy, antitrust, and national security laws. ByteDance has also faced stiff competition from rivals such as Kuaishou, Alibaba, and Facebook, who have launched similar products and features to challenge ByteDance’s dominance. ByteDance has also struggled to monetize its massive user base, as advertisers and creators seek more diverse and lucrative platforms.

ByteDance has not given up on its gaming ambitions, and has stated that it will continue to invest in the sector and explore new opportunities. However, it remains to be seen whether ByteDance can overcome its challenges and achieve its vision of becoming a global gaming powerhouse.

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