Meta to Make Comeback in China? Company Closing In on Deal With Tencent to Sell MR Headsets

Meta Platforms Inc. is close to reaching a deal that will bring its mixed reality headset to China through a partnership with Tencent Holdings Ltd.

Under the agreement, Tencent would manufacture a version of a headset using Meta’s hardware specifications and software. (REUTERS)

 Meta Platforms Inc. is close to reaching a deal that will bring its mixed reality headset to China through a partnership with Tencent Holdings Ltd.

Under the agreement, Tencent would manufacture a version of a headset using Meta's hardware specifications and software, a person familiar with the conversations said, asking not to be identified because the information isn't public. The headset is proposed to be branded and marketed under the Tencent name, the person said, while cautioning that talks aren't finalized, the plan could change and a decision hasn't been made on the name or branding.

Meta didn't respond to a request for comment. Tencent didn't immediately have a statement. The Wall Street Journal earlier reported that Meta plans to sell virtual-reality headsets in China with Tencent.

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A partnership with Tencent may mark a comeback of sorts for Meta in China. Both Meta's Facebook and Instagram were blocked from running in China years ago, according to the US International Trade Commission. The partnership would also bring together two major contenders in the metaverse space. Last year, Tencent was said to be considering a deal to acquire Chinese gaming handset maker Black Shark, a move that was seen as potentially helping the tech behemoth further its ambitions for the metaverse. 

Meta is similarly seeking out relationships with contract manufacturers or original equipment makers, known as an OEMs, around the world, according to the person familiar with the company's plans.

In September, Meta debuted a new generation head-worn device called the Quest 3. It raised the price of its mass-market headset to $500. 

Meta's relations with China have proven tenuous at times. In August, Meta said it had intercepted a Chinese influence campaign that it described as the “largest known cross-platform covert influence operation in the world.” The social media company removed more than 7,700 Facebook accounts and 954 pages linked to the campaign, which spread positive commentary about China along with criticisms of the US, Western foreign policies, and critics of the Chinese government. 

Meta said its investigation found links between the campaign and individuals associated with Chinese law enforcement.  

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