What happened: Pony Ma, founder of Chinese internet giant Tencent, outlined the company’s shifting strategic vision, saying the focus of mobile internet is moving from consumer to industry. In an open letter just ahead of the company’s global partner conference, which begins today in the eastern Chinese city of Nanjing, Ma said Tencent wants to bring the knowledge and expertise the company gained in serving Chinese consumers to enterprises and industries. “We believe that the first stage of the mobile internet, the consumer internet, is drawing to a close and the second stage, the industrial internet, is kicking off,” Ma wrote, citing smart retailing and smart manufacturing as examples.
Why is it important: Tencent market value has decreased by around $20 billion since the beginning of this year as the company faces challenges, especially in its core area of online gaming. Increased scrutiny by regulators of the negative impact of gaming on the country’s young population has resulted in no new gaming approvals since March. In late September, Tencent announced a major restructuring and Ma’s letter was the first chance for people outside the company to understand better its underlying strategy. As part of the reshuffle, and a step toward its new industrial focus, Tencent has set up a business group dedicated to cloud and smart industries. Tencent’s blueprint mirrors a broader shift in China’s industrial policy that aims to boost industries that create greater value, and that are more competitive in areas such as AI. Expect more details of Tencent’s future plans to trickle out from its global partner conference, which runs November 1 through 3.