ByteDance acquired Tencent’s enemy.
Editor’s note: This article is from the micro-channel public number “game Awakening” (ID: youxixinzhi), Author: Jagger, Aleister, hillside planting trees.
March 22 news, Mutong Technology and ByteDance’s game business brand Chaoxi Guangnian reached a strategic acquisition agreement.
Mutong Technology is currently the most outstanding Chinese company in the overseas MOBA game market. This company also has a lot of connections with Tencent. In 2018, there were news reports that a former Tencent employee was awarded 19.4 million compensations for violating the competition agreement. This “ex-employee” was the boss of Mutong Technology Xu Zhenhua, and Tencent subsidiary Riot Games also Sued Mutong Technology’s MOBA game “Mobile Legends” for plagiarizing “League of Legends”.
After the acquisition of Mutong Technology, Xu Zhenhua may leave the market.
What kind of game company is Mutong Technology?
There is news that ByteDance acquired Mutong Technology at a price of 5 billion US dollars, but the news has not been confirmed.
Mutong Technology is one of the TOP20 Chinese game companies going overseas. The company was established in 2014 and has now grown to a scale of 600 people. According to the new knowledge of the game, the company’s monthly turnover is around RMB 150 million.
1. MOBA becomes a phenomenal game in Southeast Asia
There are three main games under its umbrella: strategy game “Magic Rush”, MOBA game “Mobile Legends: Bang Bang (Endless Duel)”, idle game “Mobile Legends: Adventure”, of which “Endless Duel” contributed Over 90% of the turnover.
“Endless Showdown” was launched in June 2016. The number of monthly active users worldwide exceeds 90 million, and the monthly turnover is about 100 million to 140 million yuan. According to the new knowledge of the game, the cumulative turnover of the game since its launch has exceeded 5.5 billion yuan.
It is regarded as a “national” game in the Southeast Asian market, and it is often ranked TOP5 in the Google Play game bestseller list in the four major markets of Malaysia, Singapore, the Philippines and Indonesia. The performance in the US market is also very good. It has topped the 13th position on the US iOS game bestseller list, and the recent ranking is also around 100.
“Magic Hero” is inA strategy game issued by the game company Zhixingtong (also a shareholder of Mutong Technology) in 2015. The game has won the top 10 iOS game best-selling list in 94 markets. Even in the system of Zhixingtong, which was once the first overseas game company, it is a very capable product.
After “Endless Duel” became popular, Mutong Technology launched a new IP title “Mobile Legends: Advance” in 2019. This is an idle game, which has topped the App Store download list of major Southeast Asian countries, which shows the appeal of the “Mobile Legends” IP. However, the revenue capacity of “Mobile Legends: Advance” is only average than that of “Endless Showdown”. Now the best-seller lists of App Store games in Southeast Asian countries are almost out of 100.
Since the establishment of Mutong Technology, the frequency of launching games has not been high, but in 2020, it has released 57 games madly. These products are mostly casual games, and most of them only land on the Android platform. Most of these games have now been removed from the shelves, and only 12 are left. These games are mostly mediocre. The snake-eating game “Sweet Crossing: Snake.io” is not bad. It has entered the top 10 Google Play game download list in major countries in the Southeast Asian market.
The overseas pandemics of “Magic Hero” and “Endless Duel” have verified Mutong Technology’s leading position in the field of strategy and MOBA games. Bytedance’s acquisition of this company can be regarded as an immediate upgrade to the head Game company going to sea.
2. Founder Xu Zhenhua may quit
According to the new knowledge of the game, Mutong Technology will continue to operate independently after the acquisition, but its founder and largest shareholder Xu Zhenhua may withdraw. This point was also mentioned in the email sent by Mutong Technology CEO Justin to all employees (the full text of the email “Join ByteDance and Open up the Global Market” is attached to the article).
Mutong Technology’s shareholding structure (before acquisition)
Yuan Jing said that he and Xu Zhenhua have always had different ideas. Yuan Jing will stay as CEO and lead Mutong Technology to go forward. Xu Zhenhua “I wanted to understand very early that the game business is not him (referring to Xu Zhenhua’s ultimate goal, he looks forward to more different challenges.”
The grievances between Mutong Technology and Tencent
After the acquisition of Mutong Technology was exposed, some media said that Tencent was also the bidder. Taking into account the four-year story between Mutong Technology and Tencent, it once again proved that there is no permanent enemy in business.
1. Founder expelled from Tencent
Mutong Technology is actually a Tencent-based startup company.
Previously reported by Game News that the founder of Mutong Technology, Xu Zhenhua, has been working for Tencent since April 2009. He is an employee of Tencent’s Shanghai Wucaishi Studio. He has served as the chief planner of “Tribal Guardian War” and “Legend of Xuanyuan”. 》Operation Manager.
During his work at Tencent, Xu Zhenhua founded Mutong Technology. After the incident was learned by Tencent, the labor relationship was terminated on the spot. According to Xu Zhenhua’s statement, in May 2014, Tencent informed Xu Zhenhua that setting up a company abroad was a serious violation of discipline. On the same day, he was confiscated with his key card and expelled from the office. The next day, Xu Zhenhua’s work mailbox and internal office system permissions were also cancelled.
In September 2014, Tencent also sent a notification email to all employees of the Shanghai company regarding Xu Zhenhua’s dismissal.
Timeline:
From April 2009, Xu Zhenhua worked in Tencent;
On January 26, 2014, Xu Zhenhua invested in the establishment of Shanghai Mutong Technology Co., Ltd.;
On May 21, 2014, Tencent discovered that Xu Zhenhua had established a company abroad and terminated the labor relationship between the two parties on the spot;
On May 28, 2014, Tencent handled Xu Zhenhua’s retirement procedures for Xu Zhenhua;
In September 2014, Tencent Mail informed Xu Zhenhua that he had been expelled for violating the high-voltage line.
After leaving Tencent, Xu Zhenhua officially started his entrepreneurial road.
2. Compensation of 19.4 million yuan for violation of competition restrictions
More than two years after Xu Zhenhua left Tencent, he was violated by his old clubAnti-competition restrictions were brought to court. What is behind all this is “Endless Showdown”.
Indefinitely, in July 2016, the “Endless Duel” developed by Mutong Technology began to operate overseas. In October of the same year, Tencent learned of this matter. And there is another thing that is easy to be ignored by everyone. In September 2016, the Hong Kong, Macao and Taiwan version of “Glory of the King” was also launched, which was a starting point and slowly opened to sea.
At that time, “King of Glory” was nowhere in the limelight in China. It ate 95% of the domestic MOBA market and greatly reduced the living space of other game categories. And MOBA is also a category that is popular all over the world, and it was a self-developed game that Tencent was most likely to open a global start at that time. But “Endless Showdown” came first.
Xu Zhenhua first received a lawyer’s letter from his old company, and then began to file a court case. The main reason for Tencent’s lawsuit was that Xu Zhenhua signed a non-competition agreement and still established a company outside without authorization. The established company has a direct competitive relationship with Tencent.
Xu Zhenhua believes that Tencent filed a lawsuit maliciously because “Glory of Kings” is exploring overseas markets, and that Mutong Technology’s game “Endless Duel” has seized overseas markets and affected the development of “Glory of Kings” in overseas markets. It is unfair competition.
The case ended with Xu Zhenhua paying Tencent RMB 19.4 million.
3. “Endless Showdown” plagiarizes “League of Legends” and “King of Glory”?
“Endless Showdown” was also sued overseas.
Mutong Technology’s “Endless Duel” mainly operates overseas. Tencent’s wholly-owned subsidiary Riot Games filed a lawsuit in the California Central District Court, claiming that “Endless Duel” copied “League of Legends” and pointed out that “Magic Heroes” The characters in “League of Legends” are similar to those in “League of Legends”, and request “Endless Showdown” and “Magic Heroes” to be removed from the App Store and Google Play, and compensated 150,000 US dollars.
From the point of view of the amount of compensation, the amount of compensation required by Riot games was not high compared to the overseas income of the two games at that time, and the focus of the lawsuit was still on the delisting point. Since the games involved in this case are mainly for overseas markets, if Riot games wins the case, then for Mutong Technology, removal from the App Store and Google Play will undoubtedly be a disaster.
The case didn’t end, and the flames of war moved to the country.
Tencent once again brought Mutong Technology and Xu Zhenhua to court on the grounds that “Endless Duel” plagiarized and infringed “Glory of the King”.
Tencent believes that “Endless Duel” is a game corresponding to “Glory of the King” in various aspects such as login interface, game map, game interface, hero image, hero skills, equipment icons and feature introduction, and summoner skill icons and skills expression. yuanThe same. Request Mutong Technology and its subsidiaries to stop the operation of “Endless Showdown” and compensate 10 million yuan.
Currently, the latest development of the plagiarism case is not available, and “Endless Showdown” is still in normal operation.
Byte-beating game field layout
Bytedance is developing rapidly in the game field. There are currently 29 game companies, 10+ game studios, 4 major publishing platforms and over 2,000 employees. ByteDance’s game business is in charge of Yan Shou. Yan Shou has worked in Tencent’s strategic cooperation department for two years. The background of the person in charge almost clarifies the strategic direction of their expansion of the game.
But in fact, there is not much room for byte beating in the investment field.
On the one hand, Tencent is accelerating its investment layout. According to the statistics of Game New Knowledge, Tencent has invested in more than 30 game companies in 2020. Tencent’s resources and experience in game operations in traffic announcements can provide game developers The help it brings is hard to refuse. On the other hand, from the information acquisition alone, ByteDance is also difficult to compare with companies that are keen to invest in the game field, such as Sanqi Mutual Entertainment, IGG, and Zhixingxingtong.
At present, Alibaba Interactive Entertainment is also trying to join the game field, but compared to Bytedance, Alibaba Interactive Entertainment already has two successful self-developed products, “Three Kingdoms: Strategic Edition” and “Three Kingdoms Fantasy Continent”, and the former NetEase After the acquisition of Jianyue Technology, founded by COO Zhan Zhonghui, by Ali Mutual Entertainment, it means that they still have the ability to spend time training some potential teams.
Currently, the investment difficulty of Bytedance is that it can neither provide enough resources and experience to help like Tencent, nor does it have the accumulation of games to accompany the growth of small companies.
Mutong Technology is able to be included in the pocket by ByteDance, which can be regarded as a new level. After all, the Mokun game acquired the year before has remained silent.
Finally, a letter from the CEO of Mutong Technology is attached:
Join ByteDance to open up the global market
