RISE OF THE CY­BER ATH­LETES

E-sports takes off as a pro­fes­sional game in Asia with ven­ture cap­i­tal pour­ing in but re­turns are slow to ar­rive

China Daily (USA) - - ANALYSIS -

Dota2,

event in Moscow, Rus­sia, on May 13. a team-based strat­egy game, gen­er­ates plenty of en­thu­si­asm among Asian gamers.

But it should be taken into ac­count that some of the largest in­vest­ments in 2014 were an anom­aly. For ex­am­ple, South Korean game com­pany CJ Games raised $500 mil­lion.

“Ven­ture cap­i­tal­ists want a large cus­tomer base, a large num­ber of reg­is­tered users, even if plat­forms are los­ing money right now,” says Guan Wang, CEO of Ali Es­ports, which is part of Ali-sports, a sub­sidiary of e-com­merce gi­ant Alibaba. He adds that plat­forms are now ex­plor­ing a self-suf­fi­cient busi­ness model, rather than re­ly­ing on out­side fund­ing.

De­spite all this money float­ing around, the e-Sports in­dus­try is still in its in­fancy. There are great ex­pec­ta­tions that it will gen­er­ate more and more rev­enue, how­ever.

Bro­ker­age firm Industrial Se­cu­ri­ties es­ti­mates that by next year, China will have an e-sports au­di­ence of 148 mil­lion play­ers, up from 48 mil­lion in 2015, when the whole in­dus­try was worth $4.2 bil­lion.

De­spite the slew of ini­tial losses, many think there is a huge op­por­tu­nity for in­vestors to make hand­some re­turns through chan­nels such as mer­chan­dis­ing, ad­ver­tis­ing, events, ticket sales and even lot­ter­ies.

“We can’t spec­u­late as to the ex­act rea­son why ven­ture cap­i­tal­ists are in­vest­ing in Asian e-sports plat­forms and tour­na­ments. That be­ing said, we be­lieve that e-sports con­tin­u­ally shows phe­nom­e­nal growth in the num­ber of play­ers and spec­ta­tors,” says Paul Chan, chief mar­ket­ing of­fi­cer at Hong Kong Es­ports, which owns a pro­fes­sional Hong Kong-based gam­ing team of the same name.

“We feel that an in­dus­try with such large-scale growth of ac­tive and en­gaged fans as e-sports is al­ways a good place to in­vest, as even­tu­ally var­i­ous dif­fer­ent prod­ucts and ser­vices can be of­fered to those fans.”

And it is not hard to see why the whole in­dus­try is be­com­ing hugely pop­u­lar. China, for ex­am­ple, has a large pop­u­la­tion and a high pen­e­tra­tion of both in­ter­net and mo­bile phones.

“I see peo­ple who are aged 40-some­thing or more play­ing e-sports on mo­bile phones. Video plat­forms don’t earn money in China.

In ad­di­tion, e-sports is gen­er­ally gain­ing the sup­port of au­thor­i­ties. In China, for ex­am­ple, the Gen­eral Ad­min­is­tra­tion of Sport of China says it would work ac­tively on the reg­is­tra­tion of pro­fes­sional gamers.

Even with­out prize money, pro­fes­sional e-sports ath­letes are al­ready get­ting paid hand­somely, some­times even more than ath­letes in more con­ven­tional sports.

“Pro-gamers, I’m say­ing top progamers here, they earn a lot of money. Top gamers make the same amount as base­ball play­ers in South Korea, an in­cred­i­bly pop­u­lar game,” says Lim.

De­pend­ing on the game, pro­fes­sional play­ers can earn a min­i­mum of $50,000 per year and for the best of the best, the sky is the limit.

“This is with­out fac­tor­ing the money they make on the side from be­ing on TV com­mer­cials, ad­ver­tise­ments. It is ex­actly like sports,” says Lim.

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