Meta Signs An Exclusive Deal With Tencent To Capture The VR Market In China!
By TD NewsDesk
Updated on Mon, Nov 13, 2023
Wear me and you're not where you seem. Creating virtual dreams, what am I?"
You are a Virtual Reality (VR) headset!
Well, VR headsets are catapulting into the mainstream, transforming entertainment, gaming and more. With an immersive blend of technology and imagination, these headsets are not just gadgets – but portals to new dimensions.
No surprise, the revenue of the VR market in China amounts to US$2.8bn in 2023 and is anticipated to grow annually by 2.31% (CAGR 2023-2028). Grabbing this growing popularity of VR headsets in China, Meta has announced a groundbreaking move!
According to the report, the tech giant Meta has teamed up with Tencent (a leading Chinese technolog conglomerate) to launch a new, budget-friendly virtual reality (VR) headset in China. The deal designates Tencent as the exclusive distributor of the headset in China, with sales expected to commence in late 2024.
Let's see why this deal is the talk of the town.
What comes as a surprise is, that Meta's Facebook and Instagram, despite being blocked in the country, the tech giant is determined to make a splash in the thriving Chinese VR market.
In fact, in 2019, Mark Zuckerberg, Chairman of Meta, kind of criticized China saying, “While our services, like WhatsApp, are used by protesters and activists everywhere due to strong encryption and privacy protections, on TikTok, the Chinese app growing quickly around the world, mentions of these protests are censored, even in the U.S. It’s one of the reasons we don’t operate Facebook, Instagram or our other services in China. I wanted our services in China because I believe in connecting the whole world and I thought we might help create a more open society. I worked hard to make this happen. But we could never come to an agreement on what it would take for us to operate there, and they never let us in.”
Now, this strategic partnership not only marks Meta's return to China after a 14-year hiatus but also positions the tech giant to compete with Bytedance, the company behind TikTok, which currently dominates the Chinese VR headset market with its Pico device.
While the report did not disclose the new headset's potential price, Meta currently sells its Quest 2 headset in the United States at $300, with the high-end Quest Pro priced at $1,000. Earlier this year, the company unveiled the Quest 3, starting at $500. In an effort to cater to the Chinese market, Meta plans to utilize cost-effective lenses for the headset in China, aiming to capture a larger share of device sales.
Well, reports say this deal comes at the right time – let's see how!
In the midst of the US-China geopolitical tension, Meta and Tencent are forging ahead, with Meta focusing on hardware sales while Tencent reaps the benefits of content and service revenue.
The move is significant for Meta as it faces stiff competition from Apple's upcoming mixed-reality headset, Vision Pro, set to hit the market early next year. Priced at more than three times Meta's most expensive Quest headset, Vision Pro targets enthusiasts in the nascent VR space.
Nevertheless, as the VR landscape continues to evolve, Meta's collaboration with Tencent adds a new dimension to the competition in the Chinese market, promising consumers an exciting and more affordable virtual reality experience.
Do you think Meta's move will be a page-turner in the virtual reality space? Will more tech businesses tie up with Chinese tech firms to access the consumer market in China?
Feel free to pitch your thoughts in the comments section below!
First published on Mon, Nov 13, 2023
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