Tencent steps up its esports ambitions in 2019
Tencent are already well-known as being a dominant force in the Chinese esports industry. While the company have dealings in everything from television to real estate, they have become increasingly renowned for their involvement in video gaming. Since March 2018, Tencent have become the largest video games company in the world, and they are increasingly seeing esports as being an excellent way to harvest long-term revenues from competitive gaming.
In a recent interview, Tencent’s e-sports division manager, Hou Miao, stated that whilst the short term revenues from esports aren’t particularly profitable, they are able to create valuable long-term involvement from dedicated gamers. What’s particularly interesting is that many local governments in China are starting to cooperate with Tencent in organising and running top-level esports tournaments.
Whilst Tencent’s profits were hit in 2018 by governmental clampdowns that struck top titles like League of Legends, it seems that there could be a thawing of the regulations that had previously deemed many games to be have content that conflicted with the approved themes. As such, Tencent will be eager to see whether their licensed game, Playerunknown’s Battlegrounds, gains approval in the coming months.
Tencent have already established a vibrant esports scene in China with in-house titles like Honor of Kings garnering over $1.3 billion dollars in 2018 alone. This is bolstered by the fact that Tencent bought Riot Games in 2011 and can now claim to own League of Legends which is currently the most popular esports title in the world. In addition to this, Tencent have a majority share in last year’s gaming sensation, Fortnite, plus they also have controlling shares in top games developers like Supercell and Miniclip.
However, it’s clear that Tencent are setting their sights higher still. This is because the company are currently in talks with Electronic Arts to try and get the distribution rights in China for Apex Legends. This battle royale title has been a breakthrough hit in the past month and has even overtaken Fortnite in streaming. When you couple this with the fact that Apex Legends has even launched a competitive gaming scene, then it’s easy to understand why Tencent would want a piece of the action.
Much of these developments depend on how well Tencent are able to work with China’s authorities in pushing forward the growth of esports tournaments. With recent successes like the final tournament of Honor of Kings attracting 15,000 fans in Shanghai, as well as Invictus Gaming’s dramatic win of the League of Legends World Championship last year, it seems that esports could be too big for the Chinese government to ignore.