Why Telcos Should Start Streaming in China's $3B Worth eSports Market

Why Telcos Should Start Streaming in China's $3B Worth eSports Market
Abdullah Muhsin, Senior Content Marketing Officer

The exhilarating world of eSports is a fast growing gaming phenomenon with millions of energetic and engaged fans tuning in from around the world.

eSports is the competitive part of the gaming industry, where professional players or teams participate in competitions that offer prize money while games are being broadcast online. 

The tournaments are often held in large arenas, similar to football stadiums, where enthusiastic spectators can support their favorite players and teams. 

The most popular games played at the competitions are the same as those played at home: Fortnite, League of Legends, and Call of Duty.

In the last few years, eSports enjoyed an incredible boost in legitimacy by being featured alongside traditional sports in multinational events, and the International Olympic Committee is even exploring the option of including gaming into future Olympic events.

eSports Market in China

The popularity of eSports in China is best illustrated by the fact that there are over 170 million eSports players and fans, more than every other regular sport. 

The number of fans who tune in to watch China’s top League of Legends eSports team play live equals the total population of the United States!

Players often chat and interact with their fans during live streams who leave comments and words of encouragement and sometimes go so far as to offer strategy tips.

China’s eSports growth has also been driven in part by the country’s obsession with games. About 560 million people - or seven in 10 of the country’s online population - play games in China, according to a report by market intelligence firm Newzoo.

China makes up 57% of the global eSports audience- with about 3.5 billion hours of eSports videos viewed and 11.1 billion eSports streams delivered to the country last year, according to an IHS Markit research report.

Antonio Wang, an associate vice-president at IDC, a market intelligence firm claims that “entertainment from screens, such as PCs or mobile phones, is much more popular in China” than in Europe or the US. “A big proportion of gamers are also digital natives, who are used to playing games on their mobile phones and… watching eSports as a form of entertainment.”

China’s prominent state television broadcaster China Central Television has published a report in which it valued the domestic eSports market at $1.19 billion in 2018 and is expected to reach $ 2.86 billion by 2020.

The number of eSports leagues in 2016 was less than 10. Today, the number of eSports leagues has ballooned to over 100 with dozens of applications being sent every month.

To meet the demand from the eSports industry, numerous Chinese colleges have opened eSports related courses to cultivate talent across different areas including event management, event operation, eSports broadcasting, and eSports streaming.

The Chinese government is also trying to raise public awareness of eSports as a whole. On April 3rd, the Chinese government officially confirmed “eSports operator” and “eSports player” as 2 new professions in the country.

With strong government support, Chinese eSports fans will be more willing to engage in the industry and, in turn, contribute to the further development of eSports both domestically and internationally.

eSports Streaming

The growth of stream viewing directly corresponds to a rise in interest in eSports. Online streaming platforms, such as YouTube Gaming and Twitch are growing in popularity. The streaming service Twitch is almost synonymous with video game streaming. It has recently announced the development of Twitch Turbo, which is a subscription model that streams games without any ads.

Before that, Twitch introduced a tool for the popular game Black Ops 2 that allows players to live stream directly from the game.

A large number of eSports events are streamed to spectators via the internet. Other major streaming services include YouTube Gaming, Hitbox, and Azubu.

Live broadcasts of games attract the most viewers, and streaming services let individual gamers broadcast their games without relying on various eSports tournaments and events. Individual gamers can form a partnership with either Twitch or Hitbox where they get a part of the revenue from the ads that run on their stream.

Twitch also gives its more famous users the ability to offer a subscription service for their viewers.

According to Twitch’s VP of Marketing Matthew DiPietro, the revenue model of eSports is diversified and relies on advertising, big-name sponsors, subscription services, ticket purchases, and pay-per-view products to only name a few options.

As the distribution of internet-connected video devices continues to increase, television is losing in popularity. Online streaming is well on its way to surpass traditional TV watching as the primary form of media consumption.

Telecoms Expanding into eSports Streaming

Against this vibrant eSports backdrop, telecoms have the opportunity to create network packages with benefits for eSports enthusiasts. In other words, eSports are another great way for telecoms to adopt new revenue models and expand their entertainment portfolio.

The popularity of game streaming is the perfect opportunity for telecoms and gaming companies to form partnerships to support eSports events streaming.

Telecoms can track and monitor data on audience sizes and for services like Twitch or Hitbox at eSports events.

Also, telecoms can use API technology to provide data on players, teams, matches, and tournaments. The data is always up-to-date throughout the eSports event.

APIs can collect live statistics and display them in real-time to all the different parties involved in the eSports space, including sponsors, media and the teams themselves.

That is to say, telecoms can provide knowledge in actual time, prediction and new monetization services in the expanding market. According to the founders of PandaScore, a company that relies on APIs to collect data on eSports competitions, API technology is, “ a strong building block for a modern eSports data infrastructure that will also open new perspectives for traditional sports market in the midterm.''

Throughout Asia, prepaid is still the prevailing subscription model and generates the most revenue. In fact, over 50% of revenue is generated from prepaid users. Through APIs, telecoms could ensure that even prepaid watchers can enjoy the content without interruptions!

APIs are an ideal way of allowing prepaid watchers to enjoy eSports content because they allow viewers to make in-game purchases with the help of microloans that they receive from telecoms, the way Apigate Stretch enables.

By using API technology, telecoms can offer a smooth streaming experience to viewers using e-wallets, DCB, microloans, real-time credits, merchant credits or even carrier bundling.

Are you interested in being a part of the eSports revolution? Get in touch with us and enter the exciting multi-billion dollar industry.

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