Rumor: Tencent to Restructure


According to industry sources, Tencent (0700.HK) is preparing plans to restructure its services into six major groups.

Online rumors and media reports state that the six major groups, post-restructuring, will be the TEG (Technology and Engineering Group), comprising the former Tencent Research and operations lines; the SNG (Social Networking Group), comprising the company's internet line and some departments of Tencent Research; the CBG (Creative Business Group), comprising Tencent's Guangzhou R&D Center and enterprise development systems; the IEG (Interactive Entertainment Group), comprising Tencent's PC Manager team and interactive entertainment line; the MIG (Mobile Internet Group), comprising the former wireless division and some departments of Tencent Research; and the OMG (Online Media Group), which will continue in the role of the company's existing online media division.

The position of Tencent's Guangzhou R&D Center, which introduced the wildly popular Weixin messaging product last year, has been elevated in the restructuring, following which it will operate on an equal footing to Tencent's other businesses.

Previous media reports had claimed that Tencent's businesses would be divided into four product lines - S (functions), R (services), O (security organization), and B (Businesses). B, described as the largest of these, was also referred to as the "Production line," as it would represent the chief source of profit for Tencent. The B line would be further subdivided into the B0, B1, B2, B3, and B4 lines based on service categories, all of which would be collectively referred to as "B." "B0" would cover enterprise growth systems; B1, wireless business systems; B2, internet business systems; B3, interactive entertainment business systems; B4, internet media business systems. The R line would also be subdivided into R1 and R2.

A Tencent spokesperson declined to comment on the reports, but said that the company would make a public announcement should any new information arise.


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