It is predicted that the size of the Metaverse-focused market in China, one of the largest economies globally with a population exceeding 1.5 billion, will reach $8 trillion.
Although Chinese technology giants have taken more modest steps compared to their Western counterparts, there is a growing interest in investing in Metaverse projects, with initial focuses on the gaming industry and social media.
While U.S. companies, particularly Meta (formerly Facebook), have heavily invested in the Metaverse, and Microsoft chose to strengthen its gaming portfolio with the acquisition of Activision Blizzard, Chinese tech giants are approaching the Metaverse with a more cautious strategy.
In a recent note, Morgan Stanley projected that the Metaverse market in China could potentially reach $8 trillion. Technology giants like Tencent, NetEase, ByteDance, and Alibaba are expected to be key players in this emerging field.
The potential applications within the Metaverse universe are diverse, with virtual reality, gaming, and social media being identified as early candidates. These applications could involve activities such as purchasing virtual items in games or creating digital avatars for virtual meetings.
Winston Ma, Managing Partner of CloudTree Ventures, emphasized the significance of the Metaverse for Chinese tech giants, stating, “Metaverse is the future of social networks. This technology is of critical importance for Chinese technology giants, whose business plans are maturing in the field of smartphones and mobile internet, to reach the new generations.”
Metaverse moves of Chinese tech giants
Tencent CEO Pony Ma mentioned in a meeting in November that the Metaverse project would drive growth in industries like gaming. As the world’s largest gaming company, Tencent possesses a robust portfolio of PC and mobile games and also owns the messaging app WeChat with over a billion users. Ma highlighted that the company has the necessary technological expertise to explore and develop the Metaverse project.
ByteDance, the company behind social media applications like TikTok and Douyin, made a bold entry into the gaming industry by acquiring virtual reality glasses manufacturer Pico in August. Their recent moves suggest a focus on the virtual reality social media and gaming industry.
Alibaba, the e-commerce giant, announced its plans to launch augmented reality glasses this year. Augmented reality involves integrating virtual images into the real world, making it a potential application for the Metaverse.
NetEase, another major player in the Chinese gaming industry, has established a center in the southern region of Hainan to develop Metaverse applications.
Baidu, the search engine giant, has taken advanced steps in the Metaverse field. They launched the Metaverse application called XiRang last year, capable of hosting up to 100 thousand people simultaneously. However, Baidu executives cautioned against high expectations during the application’s launch, stating that many aspects of the project are still incomplete. Baidu Vice President Ma Jie mentioned that a full-scale release might take up to six years.
Charles Mok, Founder of Tech For Good Asia, stated, “Similar to the move of Meta, the metaverse concept of Chinese companies can also host virtual reality/augmented reality supported games and social interaction zones in the first place.” These are expected to be the initial areas that Chinese technology giants will focus on and incorporate into the Metaverse.
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