China Sports Business Weekly | 8th January
In the news this week: T1 claims most popular overseas esports team in China, NBA Cares Charity Foundation set up, ice hockey insiders look forward to Beijing 2022, the AFC re-brands, Michael Jordan wins on emotional damages, the CBA ends 15-year relationship with Infront, and SuperGen announces US$1.5B Shanghai esports center.
In this week’s From The Top, we spoke with Chenfan Wang, VP of VSPN, General Manager of VSPN Global, about China's esports industry growth throughout 2020, opportunities China presents to overseas esports companies, how overseas organisations can work together with VSPN, utilising this investment, areas of potential for the industry in the next 3-5 years, and whether esports and traditional sports can co-exist.
Top Industry News
1. T1 Claims Most Popular Overseas Esports Team in China South Korean esports team T1 were awarded the most popular overseas esports team in China in the inaugural edition of the Mailman ‘Esports Red Card: China Digital Performance Index’. The report assesses the leading global esports teams and their performance across China’s dynamic digital ecosystem. The report also takes a deep dive into China esports livestreaming, video, best practices, opportunities, and what to look out for in 2021. Download the Red Card (English) and read more on Esports Insider (English)
2. NBA China and Chinese Youth Foundation Set Up NBA Cares Charity Foundation NBA China announced the establishment of the NBA Care Action Charity Foundation, under the China Youth Development Foundation, which aims to support sports culture and youth development in China. NBA China currently cares for social groups in need and helps promote health development throughout the country. The stated plan is to work with the China Youth Foundation to develop more activities and projects to contribute to Chinese communities. Read more on Sina (Chinese)
3. Ice Hockey Insiders on China's Preparation for Winter Olympics With the Beijing Winter Olympics on the horizon, insiders of Chinese ice hockey shared their thoughts on preparations and outlook. At the sidelines of the recent National Ice Hockey Championships in Tengchong, they touched upon how to improve the sport in China. Watch the interviews on CGTN (English)
4. AFC Rebrands Major National Team Tournaments The Asian Football Confederation’s (AFC) new range of logo marks and visual identities incorporates its major national team tournaments: the AFC Asian Qualifiers, AFC Asian Cup, AFC Women’s Asian Cup, AFC U23 Asian Cup, as well as the annual club competitions - the AFC Champions League and AFC Cup. The designs were inspired by football stadiums and Asia’s national team colours Read more on AFC (English) and China News (Chinese)
5. Michael Jordan Awarded $46K for ‘Emotional Damages’
Despite the small financial win, Michael Jordan still doesn’t own the rights to his own name in China. A Shanghai court ruled this week that a Chinese sportswear and shoe manufacturer that has used his name as its brand for decades did so without authorisation and with the intention to “mislead” consumers. It did not, however, appear to revoke the company’s right to use the phonetic English spelling of Jordan’s name in Chinese translation. Read more on Variety (English) and PP Sport (Chinese) 6. Tencent Stops Streaming Philadelphia 76ers The Chinese digital platform has stopped livestreams of games by the NBA’s Philadelphia 76ers. Tencent is covering the 76ers game through text updates, rather than livestreaming. Chinese state broadcaster CCTV, which holds linear television rights for NBA games, has not shown any games since December 22. Read more on SportBusiness (English) and VOA (Chinese)
7. CBA Ends 15-year Cooperation With Infront
The Chinese Basketball Association (CBA) stated they will form a professional team responsible for the commercial and marketing operations of the national basketball teams. This also means that the CBA has ended its 15-year cooperation with Infront. Read more on SportBusiness (English) and Sina (Chinese)
8. Beijing 2022 Unveils Pictograms for Winter Olympics and Paralympics The 24 pictograms were revealed to the world for the first time during a ceremony in Beijing. They depict each of the disciplines across the seven sports on the Winter Olympic programme, while six symbols identify the sports at the Winter Paralympics. The pictograms were designed "based on traditional Chinese seal engraving" and "embody both the motion of winter sports and China’s rich culture in modern graphics". Read more on InsidetheGames (English) and People (Chinese)
Esports SuperGen Group to Build US$1.5B International Cultural and Creative Esports Center in Shanghai Chinese property company SuperGen Group, the parent company of Chinese esports organisation Edward Gaming (EDG) announced that its “Shanghai International Culture and Creative Esports Center” started construction in Shanghai’s Minhang District. The new park will serve as the organization’s new home venue and office building, and will also house an esports entertainment venue, a “five-star esports-themed” hotel, a breakdancing facility, an indoor skydiving venue, and many other amenities and attractions. Construction on the centre is expected to be completed by 2023. The total size of the industrial park is 500K square meters, and plans to host 300 esports international competitions each year, with a capacity of 10K visitors daily. Read more on Esports Observer (English) and Jiemian (Chinese) Mailman Take: A bold statement and a huge investment. This looks like it could be the real deal and a move that would put China, particularly Shanghai, above other cities and countries vying for the tag as the ‘global capital of esports’. The quick turnaround is by no means impossible, but COVID-19 is still very much an issue which will need to be navigated.
Ping An Bank Title Sponsors Bilibili Gaming The name of Ping An will be featured behind Bilibili Gaming (BLG) during the LPL. BLG is recognised as a property of Bilibili Esports, the esports arm of the Chinese large video platform Bilibili. In August of 2020, Ping An Bank signed a strategic partnership with Bilibili Esports, including co-branding strategies, coefficient products, and services. Read more on Esports Observer (English) and Tencent (Chinese)
Hollywood Movies Fall Behind Chinese Counterparts in Biggest Market Box office revenue from western films in China more than halved in 2020, a year in which China became the world’s No. 1 movie market with a revenue of US$3.2B. Western films accounted for only 16% of the tickets, compared to 36% in 2019. Read more on Bloomberg (English) and Tencent (Chinese) Jack Ma Suspected Missing The Chinese billionaire’s whereabouts are currently unknown after reports surfaced that the businessman has not made a public appearance in more than two months. Ma, co-founder and former executive chairman of Alibaba Group, also failed to appear in the final episode of his own talent show, Africa’s Business Heroes. Read more Yahoo! (English) and Reuters (Chinese)
From The Top
Chenfan Wang, VP of VSPN, General Manager of VSPN Global
1. China's esports industry continued to grow throughout 2020, whereas traditional sports industries struggled. What do you put this success down to?
2020 was an extraordinary year for the global sports industry, including esports. Affected by the global pandemic, traditional sports events were suspended and commercial value frozen. The esports industry was also affected, but its digital advantages demonstrated its strong “anti-pandemic resilience”. From a global perspective, the revenue of the esports market is growing. The growth in European and American countries is on a good trajectory, and esports users in Asian countries grew rapidly. The global esports market is developing into a mature phase.
In China, esports has entered the final step in the “golden five years” stage. Esports users are expected to exceed 400M. China will contribute the most in global revenue, surpassing North America for the first time, becoming the most commercially valuable esports market. The World Championships of 2020 became the first esports event that allowed audiences back to watch in person. Both the S10 global finals settled in Shanghai and esports players now a recognised profession highlights the vigorous vitality of China's esports industry. In the coming year, esports and traditional sports will accelerate their integration, while 5G will bring new breakthroughs in technology and innovation as well as the upgrading of business models. The future for industry development is exciting.
2. More overseas esports teams are growing their presence online & offline in China. What opportunities does China present to overseas esports teams, brands, and companies?
From the view of commercialisation, the current commercialisation of esports in China includes copyright, sponsorship, tickets, derivatives, etc. With the development and broadening of esports events, income from traditional commercialisation and copyright is increasing. There are more and more sponsors of esports events, the unit price of sponsorship is getting higher and higher, so is the copyright fee. All of these are obvious to see.
3. How can overseas organisations work together with VSPN to achieve their goals?
Since its establishment in 2016, Hero Sports VSPN has in-depth cooperation with more than 70% of the top domestic esports events. Through our rich experience in large-scale esports, we have connected the esports resources of all circles in China and combined them with event experience to develop foreign business. The current global business scope has covered Asia, Europe and America.
4. VSPN gained strong investment last year, most notably from Tencent. How do you plan to utilise this investment and which areas do you see as having the most potential for the industry in the next 3-5 years?
In October 2020, Hero Sports VSPN completed a Series B financing of US$100M. This financing was led by Tencent, followed by Tiantu Capital, SIG, and Kuaishou. The financing will be mainly used for the new round of strategic upgrade of Hero Sports VSPN: the deepening of full-section business in esports, the research and development of esports derivative products, and the expansion of overseas businesses, as follows:
a. Deepening of full-section business in esports and continuing to upgrade professional equipment technology.
b. Esports derivative product development - Combine the characteristics of the event and the preferences of esports users, and at the same time, strengthen cross-industry cooperation with other young trendy brands to develop designs of esports derivatives.
c. Overseas business expansion - On the one hand, we hold esports international invitational tournaments in China's major esports central cities such as Shanghai, Chengdu, Xi'an and other places; on the other hand, we focus on the esports scenes, relying on its geographical advantage and cultural similarity.
5. Do you believe traditional sports and esports can co-exist, and if so, how can this happen?
As a comprehensive operator of esports, we mainly see a trend at the level of esports operations is that traditional sports will gradually move closer to esports. Clubs will gradually establish esports teams or esports divisions. Just as F1 is developing esports in conjunction with its own sports, traditional sports sponsorships will continue to be invested in esports content. --
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