News Roundup: Media, Marketing, & the Ecology
Vol 3.35 | November 24, 2020
|John Oliverius||Nov 25, 2020|
Hello Esports Enthusiasts!
Today’s roundup focuses on the topics I skipped in the November 20 newsletter: “media/streaming”, “brands/marketing”, and “ecology”.
What’s “ecology”, you ask? Technically, it’s the study of ecosystems. China’s esports ecosystem is a constant target of public-private investment and official “top-down” efforts to organize esports, a key feature of esports in China. Up until now I have awkwardly labeled this kind of news “official action” or “local development”, both of which seem too specific. I think “ecology” might be a better way to think about these kind of items.
Like esports, this newsletter is constantly evolving 🌿
Huya and the Communications University of China (CUC) [中国传媒大学] agreed to jointly establish an esports research center in Beijing. The announcement was made as part of the inaugural Beijing International College Students Esports Festival. CUC was part of an early effort to establish a formal esports curriculum, partnering with VSPN in 2019.
Bilibili Gaming (BLG) Establishes Headquarters in Hangzhou. The new HQ in Yuhang District “Future Science and Technology City [余杭区未来科技城] will house the Hangzhou Spark OWL team and the BLG Overwatch Contenders team. BLG’s goal is to develop an esports ecosystem anchored by Shanghai and Hangzhou.
Kaisa Culture Sports and Technology Group [佳兆业文体科技集团], an owner and operator of more than 20 venues including the Shenzhen Universiade Center, will partner with World Sports [世竞体育] to build the “KAISA Industry Esports Center” in Shenzhen, comprising esports venues, studios, training halls, office and commercial space. The new development will be home to Team Victorious (VTG), which plays in the LDL and the KGL (China’s development leagues for LoL and Honor of Kings), and will rebrand as KAISA.
Billed as the “first esports business community” in China, the World Esports Center [世界电子体育中心] project officially launched in Guanshanhu District in Guiyang, another major land esports-themed land development with functions including research, education, training, and international business facilities.
Bilibili and soon-to-be-merged Huya and Douyu each reported earnings and total viewership figures for 3Q2020. Key figures:
Average monthly active users (MAUs): 197.2M (+54% YoY) / Mobile MAUs 183.5M (+61% YoY) / Monthly paying users: 15M (+89%).
Total net revenues were $475.1M USD (+74% YoY), with a $112.2M USD gross profit.
40% of Bilibili’s revenue is related to gaming, and growing. The shift to an almost entirely mobile user base is dramatic.
Average monthly active users (MAUs): 194M (+19% YoY) / Mobile MAUs 59.6M (+14.4% YoY) / Quarterly average paying users: 7.9M (+12.7%).
Total net revenues were $373.3M USD (+37% YoY), with a $54.2M USD gross profit.
Stagnation in advertising revenue suggests that advertisers are moving to Huya ahead of the merger.
Average monthly active users (MAUs): 172.9M (+18.3% YoY) / Mobile MAUs 74.2M (+16.3% YoY) / Monthly paying users: 6M (+13.2%).
Total net revenues were $414.6M USD (+24.3% YoY), with a $91.4M USD gross profit.
VSPN, TJ Sports and Tencent Esports’ vendor of choice in China for producing esports competitions in top titles including LoL, Honor of Kings, Crossfire, QQ Speed, and Peacekeeper Elite, has raised almost $100M USD in a Series B financing round led by Tencent. Notably this round closed soon after VSPN’s participation in a historic Worlds 2020 series broadcast. Subsequently, Sports Money reported that Tencent divested a 20% stake in VSPN, for unclear reasons.
OWL reported that viewership of the 2020 Grand Finals in October increased 280% in China against 2019, measured using the average minute audience (“AMA”) metric. The increase is consistent with stronger viewership in China earlier in the year. The Grand Finals saw a 38% YoY increase in global AMA, with concurrent viewers peaking at 180K on YouTube. The final four teams (Seoul Dynasty, SF Shock, Philadelphia Fusion, and Shanghai Dragons) competed over LAN in South Korea with no audience, with the action broadcast using a globally distributed online remote production workflow and a virtual set, where even the anchors were virtually beamed in to the same desk from separate locations.
Esports organization LGD entered into a strategic partnership with Bixin, a popular esports-oriented platform (profiled in Vol 3.15) that offers online “training companions”. LGD’s stated goal is to improve its talent pool by integrating its systems with Bixin, as the official youth training ground of LGD’s teams.
Tencent named OPPO, lighter brand Zippo, Haagen-Dazs, carmakers Maserati and Tesla, ice tea brand Wang Lao Ji, and instant noodle brand Master Kong as the the new non-endemic partners of Peacekeeper Elite.
Chinese phone brand Xiaomi is one of the major sponsors of the Arena of Valor tournament in Brazil. Sponsorship of international esports events by major Chinese phone makers like Xiaomi and OPPO is increasingly common.
Fnatic, one of Europe’s most prominent esports organizations, was forced to post an apology for letting its brand be used in “Falling into your smile”, a Chinese drama about elite esports in China that managed to anger many Chinese esports fans for reasons well described in this article.
Thanks for reading!