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Tencent Forces Merger of Huya and Douyu Streaming Platforms

15 October 2020, 17:39
Votes: 1

Even though Tencent has already bought shares in both Huya and Douyu, the biggest Chinese streaming platforms' merger changes the disposition in the esports sphere. The rough calculations show that the unified platform will be holding about 80% of the Chinese livestreaming market. However, the most interesting now will be the new giant's further strategy on the global scene.

Tencent Forces Merger of Huya and Douyu Streaming Platforms

Being the biggest esports corporation in the world, Chinese gaming developer Tencent makes the further steps of consolidating market positions. Although the company has already bought the majority of Huya's shares and owns about thirty percent of Douyu stocks, the merger seems to be an inevitable and important step towards further development.

After the unification, Tencent will receive full control over the newly-created streaming giant with a capitalization of over $10 billion. According to the latest esports news, the total value of Douyu is about $4.7 billion, while Huya is estimated at the level of $5.8 billion. Even though the shareholders of both live broadcasters will gain about half of the voting power, Douyu will now be acting under the control of a Chinese gaming giant that will have about 67% of all stocks.

Why does Twitch have to worry about the Huya-Douyu merger?

The COVID-19 outbreak showed the potential of livestreaming services, which increased significantly during the lockdown. Being the global leader in esports casting, Twitch, however, was noted in several scandals during 2020. A lot of CS:GO and Dota2 top-streamers were banned for breaking the platform's quite weird rules. Alternative platforms like Youtube or Mixer could not catch up with the demand, and after the ban period, most of the streamers returned to Twitch.

However, the appearance of the alternative streaming platform with a real global aim can make a difference. Huya and Douyu are the place for about 300 million Chinese stream-loving people, which is a perfect number to start from. Also, the globalization trend and increase of English-speaking people in the most populated country can boost the interest of the world's most popular video game streamers. The latter will be unlikely to refuse the bigger audience and supportive donation amounts. If Tencent is able to create more flexible rules on the newly created streaming platform, it will be a matter of time when most gaming casters will switch from Twitch.

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