Back in May, ByteDance—the Chinese company that owns TikTok—was trying to leverage its one billion users to make a foray into gaming. In tests carried out in Vietnam, the company was experimenting with a system that saw users launch short, "bitesize" games that could be enjoyed for minutes, rather than hours, at a time. ByteDance also had plans for "mid- and hardcore" game development through its subsidiary Nuverse.
The plan was meant to be a major part of ByteDance's strategy for expansion: the company went so far as to acquire Shanghai-based developer Moonton Technologies to kickstart its game creation efforts, but recent news has put those plans on shaky ground. As reported by SCMP, ByteDance has begun "aggressively downsizing" its gaming operations. Wushuang Studio, another ByteDance-owned developer in Shanghai, is said to have lost most of its staff through a combination of lay-offs and internal restructuring. There have been similar job cuts at Jiangnan Studio in Hangzhou.
ByteDance is maintaining staff for games that have already launched, but the news makes it pretty clear which way the wind is blowing when it comes to the company's gaming ambitions. Efforts to turn TikTok into a gaming app are running into the same issues that every other games company in China has encountered in recent years: navigating the process of getting games approved for release by the government.
In July, the Chinese government had only approved 172 games for release since the start of 2022, almost 600 fewer than the 755 it had approved in that same time period in 2021. Total revenue from gaming declined this year, the first time since 2008 (when data became available). It's not an atmosphere conducive to big moves in the gaming industry, and it's a big reason ByteDance has adopted a new stance of “adding muscle and reducing fat” with regard to its gaming efforts.
Of course, ByteDance is still an incomprehensibly large company, and TikTok is still inescapable. It could be that the company is just reefing the sails to endure a stormy period in Chinese tech, and will dedicate itself to other ventures until the Chinese state relaxes its grip on the industry. That day might not ever come to pass though, and either way ByteDance's gaming plans—which once seemed like an area of intense focus for the company—are taking a back seat for now.
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