Many multinational CEOs like to close out the year with a message of congratulations. Tencent Holdings Ltd.’s billionaire co-founder Pony Ma delivered a no-holds-barred rant about slacking, oblivious and even corrupt employees.
Ma’s tirade marked a rare show of frustration for the usually mild-mannered mogul who helped create China’s largest internet firm away from the spotlight. Last week, the tycoon convened a town-hall meeting to personally deliver a blistering attack against the way staff managed businesses from social media and content to gaming. The message: with the survival of some businesses in doubt, they all needed to get their act together, according to people who attended the 10-minute lecture.
“You can’t even survive as a business, yet you’re chilling on the weekends, playing ball,” Ma told his audience, according to the people present, who asked not to be identified describing an internal event. His remarks were first reported by local media outlet Jiemian. Tencent representatives didn’t immediately respond to a request for comment.
Tencent, which with Alibaba Group Holding Ltd. helped establish the modern Chinese internet industry, has seen growth evaporate over the past year in the aftermath of a sweeping crackdown on private enterprise. The company’s gaming business came under attack from regulations intended to curb youth addiction, while an economic slowdown twinned with punishing Covid curbs eroded its advertising segment. It cut jobs by the thousands this year, shrinking its workforce for the first time in almost a decade.
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Ma and his lieutenants have mostly maintained an upbeat tone in public, lauding efforts to clean up internet content and restructure the gaming industry. They also expressed hopes that the reforms are mostly completed and that Tencent can get back to quality growth.
But in last week’s internal address, Ma laid into virtually every facet of his $400 billion internet empire.
He upbraided the bread-and-butter gaming division for frittering away money to acquire users for hastily churned-out titles, rather than focusing on quality. Ma accused employees of “superficial” reforms to spending and costs, according to attendees. He even said corruption remained rampant across the ranks, without elaborating, the attendees added. Even the relatively nascent cloud arm was accused of a wasteful market-share grab against Alibaba and Huawei Technologies Co., though Ma acknowledged it corrected course quickly.
But he reserved his harshest comments for Tencent’s aging social network and content empire, which is losing ground to mobile-native rivals like ByteDance Ltd., the Chinese owner of TikTok. Tencent’s years-old news service is now finally in the black after some job cuts but it could very well be culled if results don’t improve, Ma was quoted as saying.
“Could that business get cut? I told the team — possibly,” Ma told employees, according to the people present.
The one silver lining appeared to be WeChat’s short-video feed, Ma said. Tencent is laser-focused on growing that TikTok-style feature, which has yet to fully monetize content with e-commerce and advertising offerings. Executives have said advertising revenue generated by the new service should surpass 1 billion yuan ($143 million) in the fourth quarter.
But China’s biggest social media giant must continue to slash costs aggressively in 2023 — or managers will do it for them, Ma told the meeting.
“I think this should become a habit,” he emphasized, according to attendees.