Tencent replaces chairman at video game live-streaming platform Huya amid regulatory pressure and increased market competition

Tencent Holdings, operator of the world's largest video gaming business by revenue, has appointed a new head for its popular game live-streaming platform Huya amid regulatory pressure and fierce competition in this market.

Lin Songtao, who serves as a vice-president at Shenzhen-based Tencent, was named Huya's new chairman effective immediately, replacing Huang Lingdong who had held that post since April 2020, according to a statement on Tuesday from the New York-listed live-streaming service.

Huya and Douyu International Holdings, which are both backed by Tencent, are the two leading video game live-streaming operators in mainland China. Huya also runs live-streaming platform Nimo TV for the overseas market.

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Lin, who joined Tencent in 2003, has held management positions within various business lines, including the internet giant's flagship messaging platform QQ and online video business unit. A public resume of Lin, however, did not show his experience related to Tencent's video gaming business.

People are seen playing online games at the booth of live-streaming platform operator Huya during the 19th China Digital Entertainment Expo & Conference, held at the Shanghai New International Expo Centre on July 31, 2021. Photo: VCG via Getty Images alt=People are seen playing online games at the booth of live-streaming platform operator Huya during the 19th China Digital Entertainment Expo & Conference, held at the Shanghai New International Expo Centre on July 31, 2021. Photo: VCG via Getty Images>

"His successful experience in various products and businesses will be invaluable as Huya continues to strengthen its position in the game live-streaming market and unlock long-term commercialisation opportunities across the games value chain," the company said in the statement.

Huang, the person Lin replaced, became chairman at Huya in 2020 when Tencent acquired a controlling stake in the live-streaming service from social media platform operator JOYY. Huang, who joined Tencent's Interactive Entertainment Group in 2010, is a veteran in China's video gaming industry.

The latest executive shuffle at Huya could bolster a "top-level design" within Tencent, resulting in greater synergies between the firm's gaming and live-streaming businesses, according to Zhang Shule, an analyst at CBJ Think Tank.

That major personnel change comes amid renewed regulatory pressure faced by the country's game live-streaming platforms. Earlier this month, internet regulator the Cyberspace Administration of China launched a rare on-site inspection of Douyu in central Hubei province to address "serious" problems related to the platform, including pornography.

"For Huya, which has similar problems as Douyu, the regulatory pressure is extremely high," Zhang said. "The main problem for game live-streaming platforms is their difficulty to make a profit, which means they had to relax control of content to meet revenue requirements."

Both Huya and Douyu were already under scrutiny last year amid a sweeping regulatory crackdown on China's video gaming market, which is the world's biggest, to reduce game addiction among young people.

In April last year, broadcasting regulator the National Radio and Television Administration banned online platforms from live-streaming video games without approval, days after Beijing ended an eight-month freeze on new game licences.

Tencent previously wanted to merge Douyu and Huya, which would have created a game live-streaming behemoth that could take on the likes of Twitch, Amazon.com's game live-streaming service. But the deal was blocked by antitrust regulators in 2021 over concerns that Tencent would dominate that market.

Tencent owns a 46.7 per cent stake in Huya and 37.7 per cent in Douyu as of the end of March, according to the two live-streaming platforms' annual reports.

Both Huya and Douyu also face increased competition from a number of traditional video-sharing platform operators, including Bilibili, Kuaishou Technology and ByteDance-owned Douyin, the Chinese sibling of TikTok.

Huya last year saw its revenue decline by 19 per cent to 9.220 billion yuan (US$1.337 billion) from 11.351 billion yuan in 2021 amid "continued pressure from the volatile market environment". It posted a net loss of 486.7 million yuan last year, compared with a net income of 583.5 million yuan in 2021.

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2023 South China Morning Post Publishers Ltd. All rights reserved.

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