The biggest gaming company in the world might be working on its own gaming phone, according to unconfirmed reports.

Tencent is better known for games like Honor of Kings (called Arena of Valor in the West) or PUBG Mobile, but it looks like it might be trying its hand at selling hardware. The Chinese tech behemoth has already contacted several manufacturers such as Razer, Asus, Weitai Technology and Black Shark, according to sources quoted by Chinese media site 36Kr.

The report did not reveal the smartphone’s price or availability or whether it would be sold under Tencent’s brand. Tencent had not replied Abacus’ request for comment by the time of publication.

In China, mobile seems to be the magic word for the gaming industry. A third of China’s population -- 459 million people -- plays mobile games. That’s the size of the combined population of the US and Japan.

Although gaming phones have been around since Nokia released the underperforming N-Gage back in 2003, the trend has been picking up in the modern era of smartphone gaming.

Razer started selling a gaming-oriented smartphone in 2017. Within the last 12 months, Xiaomi launched Black Shark, Nubia put out its Red Magic, Asus released ROG and Vivo recently introduced iQOO.

Mobile gaming is already big business, and its future potential seems higher with 5G on the horizon. As Razer’s CEO Min-Liang Tan told Abacus, the higher internet speeds brought by 5G means “enabling gaming, anytime, anywhere."  

To handle the most demanding apps, gaming phones are made with strong processing power, large batteries… and garish gamer styling, with plenty of sharp edges. Some of them go further: Nubia’s Red Magic 3 has a cooling fan and the Black Shark includes a detachable controller.

Vivo’s iQOO gaming phone is designed with less gamer kitsch, but the company has decided to leave a glowing line down the back. (Picture: Vivo)

While it may be better known for WeChat, Tencent has a huge stake in the gaming industry. It developed the wildly popular PUBG Mobile. It also owns Riot Games and Supercell, makers of League of Legends and Clash of Clans. Tencent has a major stake in Activision Blizzard, the publisher of Call of Duty and Overwatch. And it also has a stake in the company behind PUBG’s main battle royale rival, Fortnite.

However, making games is different from making hardware, and competition in the smartphone business is fierce -- just ask HTC and LG. The market might be even tougher in China. In the last five months, the country has seen two companies give up on their smartphone dreams: Selfie king Meitu, which handed its smartphone business over to Xiaomi, and China’s 6th most popular smartphone brand Gionee, which recently shut down its website.

Hong-Kong based Razer, which makes laptops and other gear for gamers, is another company that has turned to making gaming phones. (Picture: Derek Ting/SCMP)

If the reports are true, Tencent seems to be pretty confident that mobile gaming will continue to be China’s preferred mode of gaming. Unfortunately for Tencent, its hardware projects have not seen much success, including the TingTing smart speaker and DingDang smart display. The company has also recently put out a pair of smart sunglasses that bear more than a passing resemblance to Snap’s Spectacles.

This may be why Tencent is looking for partnerships with other companies.

The social media giant is already working with Razer on optimizing its Razer Phone and is developing mobile controllers and Razer’s Cortex Android launcher app. There are rumors Tencent is collaborating with Asus on the ROG gaming phone as well.