ByteDance-owned TikTok is testing games on its short-form video platform through a tie-up with Zynga Inc (NASDAQ: ZNGA) as it plans to foray into new waters, Reuters reported on Friday.
What Happened: TikTok is planning to make gaming more widely available in Southeast Asia as early as the third quarter, people familiar with the matter told Reuters.
The Chinese company is reportedly carrying out tests in Vietnam, where 70% of the population is under 35 years, and an attractive market for TikTok rivals such as Facebook parent Meta Platforms Inc (NASDAQ: FB) and Alphabet Inc (NASDAQ: GOOGL) (NASDAQ: GOOG).
TikTok has tested HTML5 games through third-party developers like Zynga, according to Reuters.
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Why It Matters: Putting games on its platform will both increase advertising revenue and the time users spend on the app, according to the report.
TikTok plans to tap into ByteDance’s game library, Reuters quoted sources as saying, starting with games that have simple mechanisms and a short playing time.
They will include advertising, revenue from which will be split between ByteDance and game developers, a separate source told Reuters.
Notably, users of Douyin, the Chinese version of TikTok, have been able to play games since 2019.
With that, ByteDance will take on China's biggest gaming firm, Tencent Holdings Inc (OTC: TCEHY), according to Reuters.
Facebook debuted instant games in 2016 while streaming giant Netflix Inc (NASDAQ: NFLX) launched its mobile games business in November 2021.
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