Tencent CEO Pony Ma reportedly bemoans internal corruption, inefficiency
This has the ring of truth to it because Chinese giant has disclosed similar worries on earnings calls
Tencent CEO Pony Ma has reportedly dumped on his own company in a company meeting, railing against corruption, low quality products, and failing business units being propped up.
News of Ma’s displeasure emerged in Jiemian News, an outlet with a good track record of breaking news about Chinese tech companies and a place on the Cyberspace Administration of China’s list of 1,358 approved media outlets. Outlets risk losing their place on that list – and therefore advertiser support – if they run fake news or other items that bother Beijing.
Jiemian’s report is based on anonymous accounts from Tencent staff who attended the meeting, which was held online.
The story has the ring of truth about it because one of the things it reports angered Ma is Tencent cloud pursuing market share without prioritising profitability. As The Register has reported, on quarterly earnings calls Tencent has backed away from its infrastructure-as-a-service business due to the low margins it offers, and even ditched cloud projects on which it struggle to make a profit. Jiemian also reported that Ma sees Tencent’s collaboration services as it’s the Tencent Cloud’s best selling point. Again, Tencent has already said that on earnings calls.
Ma also reportedly told the meeting:
- Corruption across the business is at “shocking” levels and proving hard to root out;
- Tencent may have too many non-core businesses, and they bring unwelcome cost that should be trimmed;
- The company has followed rivals into some markets, but seldom catches up to become market leader;
- The company’s gaming business has prioritised quantity over quality, damaging profitability;
- Tencent News, which has never set the world on fire, is profitable after job cuts but Ma regards it as expendable if its performance does not improve;
- He’ll be unafraid to kill business units.
The billionaire also said he wants Tencent staff to adopt an entrepreneurial mentality, or at least to feel the kind of pressure that comes with starting your own business.
So much for China being a workers’ paradise.
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Ma thinks Tencent needs to nail video services and complementary e-commerce offerings.
Bloomberg reports that those who attended the meeting were left in little doubt that Ma was deadly serious, and that his remarks were unusually vivid and galvanised the company’s staff to do better in 2023. ®