Tencent revamps education business, launches learning-focused AI lab

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Chinese internet giant Tencent launched a new education brand “Tencent Education,” Dowson Tong, senior executive vice president, announced at the Tencent Global Digital Ecosystem Summit in Kunming Wednesday.

The company’s latest push in the education sector comes as its other businesses face new challenges in China. On the same day, Tencent also announced the launch of a new smart education lab, which is its first artificial intelligence (AI) lab focusing on a specific industry vertical.

Tencent formed its new education business segment after reorganizing its products to fall under its six core business groups. The new education business segment has different divisions dedicated to individuals, schools, education institutions, and education management, which will allow the company to work more closely with education companies and institutions, Tong explained.

In September, the company underwent its first major restructuring in six years, during which the company established two new business groups, one of which focuses on cloud and smart industries that aim to help the digitalization of industries including education.

The internet giant has been exploring AI for use in education, including deploying AI tools in WeChat for schools. Earlier this week, Bloomberg reported that Tencent led a $24 million funding round in Prowler.io, a Cambridge-based AI startup, with participation from education firm Pearson and others. The new investment will be used to launch new products and help the startup move into industry areas, including education.

The company previously invested in edtech startups including online tutoring platform Yuanfudao and English learning site VIPKID. It also operates online tutoring and massive open online course platforms.

The company’s push in China education market won’t be smooth sailing. Some of the major edtech companies backed by Chinese tech giants have hit speed bumps recently. VIPKID still struggles to turn a profit and was reportedly having trouble raising new funds. Last month, Bytedance confirmed that its online education platform Gogokid had to let go of an unconfirmed number of employees, rumored to be hundreds. AiKID, also owned by Bytedance, reportedly has suspended its business for four months.

Tencent’s latest move in education comes as some of Tencent’s core businesses including video and gaming face uphill battles. Sun Zhonghuai, chief executive of Tencent’s video streaming business, recently warned about slowing growth in user acquisition in the increasingly saturated market. The new restrictions on online game licenses last year has additionally hindered the growth of the company’s gaming business.