Tencent scraps plans for VR hardware due to bad economic outlook, sources say

Tencent, the Chinese multinational conglomerate known for its involvement in various technology sectors, including gaming and virtual reality, is said to have abandoned its plans for VR hardware.

This is according to a recent report by Reuters, which states that Tencent has canceled its plans for virtual reality (VR) hardware due to a poor economic outlook that has forced the tech behemoth to cut costs.

Vision

Tencent had previously envisioned a ring-shaped handheld controller as part of its XR (extended reality) project. According to an internal forecast from one of Reuters' sources, the project was not expected to be profitable until 2027. 

On top of that, it's also rumored that the XR unit was suffering from a lack of promising games and non-gaming applications, further reducing its potential profitability.

Setback

The cancellation of Tencent's VR hardware plans is seen as a significant setback for the company, as it will have to rely solely on VR software. With existing software products such as WeChat and the Tencent Cloud VR platform, the Chinese tech giant already has a significant presence in the VR gaming industry, but this will not allow them to expand their grip on VR as much as they would like.

The giant stays

Despite the cancellation of its VR hardware plans, Tencent remains one of the gaming industry's leading companies, with a portfolio of popular games such as its mobile game Honor of Kings and the incredibly well-known League of Legends. On top of that, Tencent also excited its fans with the recent announcement of multiple Lol spin-offs.