Tencent derives most of its revenue from online content like video games as well as its WeChat super app -- areas that have been targeted by China’s crackdown -- and the new chips will allow the company to better align with Chinese President Xi Jinping’s goals. The government has made tech self-sufficiency a top national priority, setting aside billions in government funding and offering a wide range of policy support to help local firms overcome U.S. sanctions on the semiconductor industry.
Tencent isn’t alone in answering to Beijing’s call to build a homegrown chip industry. Earlier this month, Alibaba Group Holding Ltd. unveiled a new server chip based on 5-nanometer technology for its own use. Search leader Baidu Inc. has already produced its AI chips for applications like smart vehicles, while TikTok-owner ByteDance Ltd. is putting together a team to build server chips.
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