China Esports Blast: December 2022

Each month, sports digital agency Mailman shares the biggest industry news and insights from China’s esports scene, along with analysis on why it matters.

China Esports Blast ESI Mailman news roundup
Image credit: Esports Insider / Mailman Group

For China’s esports industry, 2022 was bittersweet. During the year, the region’s most important esports city of Shanghai experienced a tough lockdown due to the government’s pandemic control policies, and multiple esports companies and competitions suspended their operations.

Fortunately, the Chinese esports industry and Shanghai were resilient and overcame several challenging situations in 2022. Both will see many potential business developments improve in 2023. Here are three biggest trends for China Esports in 2023.

Revenue opportunities return following end of COVID policies

Now that China has fully reopened — dropping COVID-19 quarantine policies and travel restrictions — the esports industry can finally have offline events with live audiences. China has a number of different esports franchise leagues, including Tencent’s League of Legends Pro League (LPL), King Pro League (KPL), Peace Elite League (PEL), and NetEase’s Naraka Bladepoint Pro League (NBPL) and Identity V League (IVL).

Those competitions are mainly taking place in Shanghai and Chengdu, cities each with populations of over 20 million people. Esports events are having more noticeable and measurable impacts on local economies; according to Riot Games data, the 2022 LEC Summer Finals in Malmo generated €4.5 million (~£4m) in revenue for the local economy during the event.

Chinese market revenue growth is therefore poised to increase with the return to live crowds following the end of covid quarantine policies.

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VALORANT becomes the most promising esports title in 2023

In December, regulators in China delivered one of the most significant Christmas presents to Riot Games and its parent company Tencent: official approval for VALORANT. The approval means that VALORANT can now be monetised in China’s gaming market, and operate esports events. Chinese esports organisations can jump into VALORANT esports without worries about Chinese regulations.

In addition, following Activision Blizzard and NetEase ending their  14-year partnership, and resulting impending closure of Chinese Overwatch servers  on January 24th, it is considered a perfect time for Riot Games to seize the opportunity to convert Overwatch fans.

It will be interesting to watch how Tencent and Riot Games operate their esports plan for VALORANT in the world’s largest esports market.

VALORANT approved in China
Image credit: Tencent via Mailman Group

NetEase likely to increase investment in Naraka Bladepoint and Identity V esports

NetEase is China’s second-largest game publisher following Tencent. Still, the Chinese esports industry usually recognises NetEase esports as the representative of Blizzard esports, such as Hearthstone, WarCraft III, Overwatch, StarCraft, and Heroes of the Storm. While those titles won’t be available post-January 24th, NetEase hasn’t been as reliant on Blizzard titles in recent years.

The publisher has two franchise leagues, NBPL and IVL. The termination of its Activision Blizzard deal will force NetEase to put more resources and investments into building the Naraka Bladepoint and Identity V esports ecosystems.

In 2022, NetEase put more than $2m (~£1.6m) in prize money into building NBPL and the Naraka Bladepoint World Championship. In addition, sources close to NetEase told Mailman Group that the company might open an esports office in Singapore.

Naraka Bladepoint World Championship 2022
Image credit: NetEase via Mailman Group

Mailman is a leading sports digital agency in China. It helps sports organisations & brands build sustainable businesses in China, one of the world’s most challenging markets. Mailman is an Endeavor China company.

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