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China’s Emerging Sporting Frontier: eSports & Online Gaming


As the second largest eSports market in the world, China is cashing in on opportunities within the growing industry. Governmental support has elevated eSports to an officially mandated sport and has fostered career prospects for professional gamers in China. Yet, some of Beijing’s actions may be betraying its true outlook on eSports and undermining its short-term efforts to spur industry growth.

The 2020 Olympics? Postponed until July 2021. The 2020 European Football Championships? Also delayed. While ‘in real life’ sporting events have been restricted by social distancing measures, eSports have largely managed to escape this fate. Partly due to the pandemic, online gaming has seen a surge in popularity and sales – and with one of the world’s largest eSports markets in the world, China is uniquely positioned to profit.

China’s developmental model for eSports combines a large emerging market with increasing governmental recognition of the industry. By designating eSports as an official sport, establishing channels for official employment, and more, Beijing has taken a heavy-handed approach to strengthen the industry. This potential merger of government and business interests uniquely develops the eSports industry in a hybridized way that allows it to stand out from, and potentially above, other eSports markets around the globe.

A Closer Look at China’s eSports Industry

Substantial Market Growth

Electronic sports, or eSports, consists of competitive video gaming in online or in-person tournaments which often offer cash or other compensatory prizes. ESports operate in much the same way as any other professional sports organization or franchise. Players are contracted by professional teams, both specializing and competing in one or more specific video games. In contrast to mainstream professional sports, in lieu of athletic equipment, eSports players typically come geared with a gaming PC rig that boast specialized keyboards, gaming mice, graphic cards, and other helpful gadgets.

Recently, eSports in China has seen meteoric growth. In 2020, the Chinese eSports market generated US$385 million and was estimated to grow at a compounded rate of 17% until 2023. Meanwhile, the entire 2019 global eSports market size was valued at US$1.1 billion and estimated to grow at a compounded rate of 24.4% until 2027. By these metrics, the revenue generated by the Chinese market alone stands at approximately 35% of total estimates for the global eSport industry.

China’s commanding market size comes from a massive audience. According to data published by the China Audio-Video and Digital Publishing Association and by the China Game Industry Development Research Institute, the number of eSports players in China nearly doubled in size between 2017-20, reaching 488 million in 2020 from 250 million just three years before.

The sharp spike in users can largely be attributed to coronavirus lockdown measures. Despite the more than 500 cancelled eSport-related events during the early days of the pandemic, the Chinese market continued to add to its eSports audience while beating 2019 revenues by more than CN¥40 billion (US$6.15 billion) in 2020 as users had few other outlets for entertainment among strict quarantine orders.

Moreover, a rising middle class in China has also contributed to the industry’s growth. Between 2000 and 2015, Beijing released numerous policies banning the importation and sale of gaming consoles on fears of potential harm to the mental health of Chinese youth. The bans did not initially include PCs, which, at the time, many consumers still struggled to afford. Nowadays, with China having achieved the status of a moderately prosperous middle class, personal computers are commonplace and have lended to the popularization of desktop-based gaming.

Unique User Demographics and Trends

China’s eSport market demographics are unique. The stereotypical eSport athlete or viewer – a nerdy indoorsy adolescent male – does not hold true. In China, according to a report from the China Money Network, 24.3% of eSports players are female, with 59% of those between the ages of 21 and 30 – much higher than the global eSports average of 16%. Parents also play an outsized role, making up 29% of viewership in the world’s largest eSports viewing market at 162.6 million. Meanwhile, close to 45% of Chinese viewers are between 25 and 34 years old, with 39% female viewership.

In terms of titles, data suggests that League of Legends (LoL) is China’s most popular eSport game, with nearly 40% of users playing this game. LoL falls under the specific multiplayer online battle arena (“MOBA”) genre within eSports, a subgenre of strategy games in which two or more teams compete against each other within a confined digital “arena.” Yet, while MOBAs represent the most popular titles, first-person shooters claim the most play time. Popular titles like PlayerUnknown’s Battlegrounds (PUBG) and Overwatch are the current standout titles in the eSports scene in China.

Industry Development

As with any spectator sport, an engaged fanbase is crucial to industry growth. Traditionally, fans would spend on tickets to physical events and through merchandise purchases. However, as the pandemic has limited the ability to gather in physical environments, eSports have been forced to innovate their sales channels. For example, to help maintain fan engagement, TCL Technology Group Corporation (TCL), a fast-growing consumer electronics company based in Guangdong, has signed a sponsorship deal with TJ Sports, a Shanghai-based joint venture between digital giants Tencent and Riot Games. According to Ma Xiaoyi, senior VP of Tencent Group, TJ Sports will focus on LoL’s short- to medium-term development planning, particularly as it relates to talent management, tournament organizing, and LoL related products. TCL will then share in the success of China’s top-level League of Legends competitions via access to the League of Legends Pro League. Meanwhile, Bilibili, also known as Station B, has secured exclusive rights to Chinese broadcasts of LoL global events through 2023 in an agreement with Riot Games valued at US$113 million. The deal will also cover non-live content like documentaries. 

LoL can be lucrative for players as well. As of January 2021, there had been US$82,056,088.16 in LoL-related prize money distributed across 2,492 tournaments. The top Chinese LoL player, Wen Bo Yu – or as he is better known by his player ID JackeyLove – has earned US$682,248.64 from the game. Interestingly, the prospect of prize money has helped legitimize the eSports field. As more turn to eSports as a possible channel for income, Beijing has been tentatively supporting its development.

The Government and eSports

China designated eSports as an official sport on April 12, 2019, with central recognition helping strengthen the industry’s growth prospects. Governmental support has sprouted numerous provincial professional associations aimed at spreading the eSports gospel, while also broadening industry career options by allowing eSports athletes and operators to register for coaching training and certification.

Yet, before eSports was given official status, China’s Ministry of Human Resources and Social Security identified eSports as an official form of employment for both athletes and eSports operators in February 2019. The government has since segmented eSports employment for athletes into five levels, with various criteria and opportunities for players at each tier.

On August 3, 2019, Shanghai hosted the 2019 Global Esports Conference. The Pudong New Area government announced that ChinaJoy – the largest gaming exhibition in China held in Shanghai – would become a flagship platform for eSports. Shanghai will also be home to the upcoming Shanghai International New Cultural and Creative E-Sports Center, due to open in 2024. With a  price tag of US$900 million, this new eSports hub has the capacity to seat 6,000 and enjoys the widespread support of both government and private industry.

Government officials have identified new opportunities within the industry. The E-Sports Center in Shanghai is just one example of how the government could leverage the industry’s growth to spur infrastructure projects, while the inclusion of eSports as a medal-winning event in the Hangzhou-held 2022 Asian Games will stimulate consumption, attract inbound investment, and create jobs. Furthermore, as the industry continues to develop, the economic gains are anticipated to grow in lockstep, forming an attractive proposition for both China’s government and private industry.

Looking to the Future of China’s eSports Market

An opinion piece from February 2021 titled “Chinese eSports with a bright future” captures the current governmental stance on eSports. A short read, the article touches upon eSport’s appearance at the 2022 Asian Games and the strong showing of Chinese eSports competitors. Notably, the piece, featured on the CCP-owned People’s Daily, denotes strong government approval. Beijing recognizes the lucrative nature of the industry as well as the potential for global soft influence that comes with the sport.

However, while the industry blossoms, challenges to its growth remain. Despite central support for the industry as a whole, the process of becoming an eSports competitor is relatively difficult and long-term job benefits are unknown. Globally, the average age of LoL competitors is 21, though few continue past 30 years of age, citing the need for more stable employment and benefits as they grow older. With a growing movement of young players aspiring to turn professional, this will form a key point of consideration for the government down the road.

Yet, even more contradictory are the sustained efforts by Beijing to remove gaming from the lives of China’s youths. Over the past decade, officials have banned various gaming consoles while more recently imposing a “gaming curfew” on younger citizens. In 2019, the Chinese government imposed restrictions for gamers under the age of 18 that bars students from gaming after 10:00pm, limits weekday gameplay to under 90 minutes, and caps weekend and holiday gameplay to three hours. These curfews pose a direct challenge to the ability for Chinese youth to develop the skills necessary to become the future eSports stars that the government seemingly aspires to develop and casts a shadow of a doubt on the true long-term intentions of central officials towards this nascent industry. 

Nonetheless, China’s eSports industry is taking a victory lap for the moment. From a booming audience to substantial channels for monetization, operators, athletes, and government officials alike are all enjoying a slice of an ever-growing pie.

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