Meta has reportedly suspended its plan to bring a cheaper version of Quest 3 to China via a partnership with Tencent.
To sell many kinds of products in China, foreign companies must partner with a Chinese company or set up a local subsidiary. Meta and Tencent's aim to sell Quest headsets in China was first reported by Chinese news outlet 36Kr early last year, though that report claimed the product was planned to be Quest 2. In November The Wall Street Journal reported that the partnership, which it described as "provisional", would now instead bring a cheaper version of Quest 3 to China instead, with the report describing the rumored Quest 3 Lite.
The reported structure of the partnership was that Tencent would sell and support the Quest headset in China, while both companies would work together on localization and translation of Quest Store content. Meta would get most of the device revenue, while Tencent would get most of the content revenue. This wouldn’t be a novel arrangement for Tencent. It has already been selling and supporting the Nintendo Switch in the Chinese market since 2019.
But a new report this month claims Meta has suspended the partnership due to unresolved details on how to handle the specifics. The report comes via Sina Finance, which cites another Chinese news outlet VRTUOLUO.
The suspension of this partnership, if true, could come as welcome news for ByteDance, which owns Pico. China is Pico's home turf, and a Quest 3 Lite would have offered fierce competition for Pico 4 and left the company in a dire state, given its sales already reportedly "fell far short of ByteDance’s expectations".