Tencent breaks into China's lucrative online video market

The launch of Tencent Video, which debuted with a beta web version in April, puts Tencent head to head with more established video players such as Youku and Tudou.

Speaking at the Tencent MIND conference in Shanghai, Alex Liu, GM of Tencent's online video department, said the launch was part of a broader cross-platform strategy. "We have a huge community at Tencent; what we have lacked is a video product of any quality," he said.

Tencent plans to integrate the new video platform into its existing media platforms including the QQ instant messaging service, and the Tencent Weibo microblog, as well as its numerous news and information portals, something Liu added would help differentiate the new product in the market.

"We are already on par with our competitors in terms of user base and available content," he said. "But video plus social will take Tencent Video into a entirely new area."

Lui pointed out that Tencent is in the process of putting RMB500 million (US$77 million) into online video-specific investments, including content and infrastructure upgrades. He said the company would be "very aggressive" in terms of TV and movie content acquisitions.

Tencent will also invest further in scaling up its production capabilities. In May, the company spent RMB450 million for a 4.6 per cent stake in Beijing-based movie production company Huayi Brothers, an acquisition that marked Tencent's first move into self-production.