Tencent has grown into a company with a stock market capitalisation of $470bn by building a social media platform that combines messaging, payments and other apps. Now it is taking a step into the world of YouTube, earmarking billions of dollars to amass a catalogue of user-generated content.

The move follows a period of rampant professional content acquisition, spanning streaming rights to the US National Basketball Association to music from major record labels. Content is a key tool for keeping users within Tencent platforms but the current big-ticket purchases “just aren’t economic”, says one analyst.

The push into user content, which Tencent calls “open media”, comes as the group flagged its lossmaking, but strategically important, video offerings when it unveiled third-quarter results on Wednesday that blew through analysts’ expectations. Net profits rose 67 per cent year on year to Rmb18.05bn ($2.72bn) on the back of a 61 per cent jump in revenues to Rmb65.2bn ($9.8bn).