Known as the owner of TikTok or Douyin in China, ByteDance is looking to branch out beyond advertising and take a share of the $ 86 billion mobile games market as well as expand its presence internationally.
Nuverse, the gaming arm of ByteDance, founded in 2019, was behind the acquisition.
“Moonton is the perfect partner to help expand our gaming strategy into international markets,” ByteDance said in a statement.
Reuters reported that the deal valued Moonton at $ 4 billion, citing two anonymous sources. ByteDance declined to comment on the value of the deal.
“Be prepared for a long war between Tencent and ByteDance for the acquisition of game content.”
The international push of ByteDance
It also allowed Tencent to expand internationally, a feat that ByteDance also hopes to achieve.
Moonton is famous for “Mobile Legends”, a multiplayer online battle arena (MOBA) game where teams compete against each other in large virtual arenas. Popular titles in this category include “Honor of Kings” by Tencent and “League of Legends” which was developed by Riot Games.
“Mobile Legends” is popular in Southeast Asia. And ByteDance teamed up with game company Gravity last year to release “Ragnarok X: Next Generation” to the region.
“Bytedance takes a holistic approach to its video game business from day one,” game analyst firm Niko Partners wrote in a note to clients.
The company could use the social media platform to promote the games and attract users.
“With Bytedance at the helm, the two companies (Moonton and ByteDance) could leverage TikTok / Douyin to promote Mobile Legends in markets such as China and the United States, where Tencent’s Honor of Kings and Riots’ League of Legends: Wild Rift are the dominant motive. MOBA Securities, ”said Niko Partners.
But ByteDance may not be able to rely solely on acquisitions to be successful in games.
“The biggest challenge for Bytedance will be to create a self-developed hit that can work for the long haul. This is why it signs publishing agreements to publish games based on popular intellectual property and acquires proven game development companies, ”added Niko Partners.