On the morning of April 15, Tencent announced a new round of organizational restructuring and personnel appointments. Unlike other Internet companies, Tencent's large-scale organizational restructuring is very rare, and the last adjustment that attracted market attention was in September 2018, when Tencent reorganized his seven business groups into six and established a new PCG (platform and content business group) and CSIG (cloud and smart industry business group), thus embarking on a crucial strategic transformation.

Compared with September 2018, the scale of this adjustment is smaller and does not involve business group level, but only business departments, subsidiaries and leading individuals. In my opinion, there are three most influential and intriguing adjustments:

1. Tencent Video, Weishi and YingYongBao have been merged into the newly established online Video Division.

2. Yao Xiaoguang, who is in charge of Timi Studio, is also the head of PCG social platform business and head of QQ.

3. Liang Zhu, the former head of QQ, was transferred to Tencent Music CEO.

Let's talk about my personal opinion, which does not represent the official point of view, nor does it constitute investment advice.

First of all, Tencent video and Weishi into a business department, the subtext is to make efforts to do "medium video".This concept is very broad, including PUGV, short variety shows, short dramas, micro films and so on. This is the stronghold of Bilibili Inc., and it is also the field that watermelon video has made every effort to attack in the past two years. I must also point out that for long video platforms, entering "medium video" may be the only reasonable way out. Because facts have proved that the traditional "high-quality content" consumes too much, lacks interaction and ROI is too low, it is a dead end that is getting narrower and narrower.

For Tencent Video, although the total number of MAU and VIP users has surpassed that of iQIYI, Inc., profitability is still very weak and the role played in Tencent's ecosystem is not very important. It does launch a series of S-level variety shows, with S-level solo dramas every quarter, so what? These "high-quality content" can only cause a gust of wind, and the actual user stickiness of the platform is far from being compared with Douyin, Kuaishou Technology and even Bilibili Inc.. Only relying on "high-quality content" to do lightweight content and trigger social communication is the right path in line with the characteristics of the Internet.

Weishi and Tencent video cooperation point is here-the former to undertake the latter's variety auditions, around the latter's drama to do the second creation, become the latter's "derivative video" stronghold. Vertical screen dramas, series of short plays, VLOG, etc., developed based on high-quality content IP, can also be regarded as the first place. This road is easier said than done, but at least it is possible to get through.

In fact, Tencent has tried this road before. Weishi, as well as hot pot video (has been closed), have taken the auditions and derivative videos of Tencent video variety shows as an important selling point. However, as long video and short video APP are scattered in different business units, there must be many gaps and inefficiencies in the cooperation. They are now merged into one business department in order to solve these problems.

Secondly, Yao XiaoguangThe task is not only to activate QQ, but also to explore more possibilities for QQ and games to infiltrate each other.As the head of Timi Studio Group, Yao Xiaoguang is undoubtedly Tencent's most successful "Mesozoic" manager (perhaps not one). For the past four years, people have asked me every month: "will Arena of Valor go downhill? Will Tencent lose her advantage in the field of competitive games? Will it be overtaken by competitors like byte beat? "every time my answer is exactly the same:" as long as Yao Xiaoguang is still the boss of Timi, then Arena of Valor will not decline; as long as Arena of Valor is still there, then no one can challenge the supremacy of Tencent's game. "

There are two things worth studying about Yao Xiaoguang: first, he has been exploring game-based social distribution paths for a long time, including setting up his own social platform for Tencent games; second, he attaches great importance to product details. He will even personally correct the planning and copywriting of his products. He is the kind of product manager Tencent needs most-he not only has big strategic ideas, but also is good at doing things in the end. It makes sense for him to be in charge of QQ, because he is already thinking about the new generation of social products, and Arena of Valor's internal socialization is also very successful.

Over the past two years, QQ's MAU has shown a downward trend. It is still the most popular social platform among young people, but it is squeezed by Tencent's own Wechat and by content platforms such as short videos and live streaming on the other. To reactivate QQ, we can either start with updating functions to provide features that are more interesting and attractive to young people, or we can start with "expanding the circle" to expand the range of target users. Both of these require the cooperation of IEG, so it is perfect for the new QQ director to come from IEG.

If Yao Xiaoguang succeeds in his new position (don't forget, he is still in charge of the original Timi Studio group), the next stop must be a higher position in the general office, such as the head of the business group. I certainly hope that he can take on more important responsibilities, because he is the most capable general of Tencent at present. Taking care of the performance after QQ will determine whether he can hold a higher position of commander-in-chief.

Third, Tencent Music's management and business will be more closely integrated with the parent company.Before 2019, Tencent Music was largely independent, and Tencent was only responsible for the strategic direction and the allocation of group resources. But in the last two years, Tencent has significantly strengthened his control over subsidiaries and investment companies-- China Literature's management turnover and general takeover of Supercell are excellent examples. Now, the former person in charge of QQ has become Tencent Music CEO, which means that Tencent has further strengthened his control.

Over the past year, Tencent Music has faced huge challenges: the space for audio entertainment such as music has been squeezed by the expansion of short video applications such as Douyin, Kuaishou Technology and even video accounts. As early as 2018, the popularity of music mainly began on platforms such as Douyin, rather than on platforms such as QQ Music. For content platforms, this trend requires a high degree of vigilance-losing control of popular trends means gradually losing control of the industry chain. How to change the above trend? I don't know. I hope the new CEO has a way.

I would not be surprised if Tencent continues to transfer as a manager, exercise greater control over subsidiaries and turn many investment companies into holding subsidiaries in the coming quarters. Tencent's Wechat and QQ social platforms still have a lot of room for traffic delivery, which can be used to commercialize content platforms or content products. Soon we will see that Tencent's income and profits still have a lot of room to rise, as long as slightly strengthen the executive power will do. The question is when and how to enhance commercialization without compromising the user experience.