As China’s gaming sector resumes growth, Tencent Holdings is stepping up its battle and enlisting the help of fierce competitor ByteDance to promote the biggest video game release in years.

Tencent launched “DreamStar,” a mobile party game, on Friday with the intention of competing with “Eggy Party,” a comparable product from NetEase that has amassed 100 million monthly active players this year.

Experts predict that DreamStar will make up to 6 billion yuan ($842 million) in its first year of operation, while Eggy Party—which mostly credits its success to ByteDance platform advertising—will bring in 8 billion yuan for NetEase this year.

Tencent, which has a contentious history of banning one another from each other’s platforms, has decided to promote Dreamstar on ByteDance’s well-known advertising platforms in an effort to maintain its position as the largest gaming company in China.

According to data tracking company DataEye, around 38% of Tencent’s DreamStar advertisements were placed on ByteDance’s online ad network Pangolin in the last 30 days, making it the most expensive ad network Tencent has used for the game.

Considering that Tencent has its own ad network and a variety of channels for marketing within its product ecosystem, it is impressive that it has chosen to rely so heavily on Pangolin.

According to DataEye, Tencent has only placed 12% of DreamStar advertisements on its own ad network Youlianghui.

Tencent has announced plans to invest 1.4 billion yuan in DreamStar’s ecosystem in order to secure its success, and this includes the advertising layout.

Tencent has already started to permit gamers to live-stream on ByteDance platforms thanks to this tactic.

A year ago, many fans would have found it unimaginable that Zhang Daxian, the leading live-streamer in China, who rose to fame from playing Tencent’s “Honour of Kings” game, would be previewing DreamStar on a ByteDance platform. Zhang Daxian launched his channel earlier this month.

Tencent and ByteDance were embroiled in a string of legal battles for many years. Citing anti-monopoly law, ByteDance sued Tencent in 2021 for preventing users from sharing material on Tencent’s apps from Douyin, TikTok’s Chinese sibling app.

Tencent filed a lawsuit against ByteDance in the same year, alleging copyright infringement, after ByteDance featured video of Honour of Kings on one of its platforms.

The apparent reconciliation between them coincides with ByteDance’s recent decision to scale back its gaming division in order to concentrate on its core platform activities, a move away from its rivalry in the gaming space with Tencent and NetEase.

With domestic revenue rising 13% to 303 billion yuan this year, Beijing’s eight-month industry crackdown two years ago is already in the past, and China’s video game sector is once again growing.

(Adapted from Reuters.com)