E-sports is rapidly growing in popularity in China. So fast in fact that the country is now set to overtake South Korea as the second-largest e-sports market after the United States. Global companies involved in video game development, consumer electronics, and other game-related products are now scrambling to tap into the growing market.
According to industry reports, China's e-sports market is growing at a compound annual rate of 21 percent. This growth is expected to continue until 2023. Based on the figures, China is expected to generate up to $210 million in revenues from e-sport gaming and events. The United States currently rakes in around $409.1 million in revenues in its e-sport market.
E-sport, or organized video game competitions, is a recent phenomenon that has grown substantially in the last few years. Most people five years ago probably were not aware that these types of contests exist. Now, there are an estimated 165 million e-sport fans worldwide. That number is expected to increase to 250 million by 2021.
Experts estimate that global e-sports revenues could reach $1 billion for the first time this year and likely reach $3.2 billion by 2022. Major events are typically sponsored by video game developers such as Blizzard and Activision as well as computer component manufacturers such as AMD and Intel.
The highest prize amount ever for a tournament was given at Valve's The International 8 Dota 2 event, which had a prize pool of $25.5 million.
The interest in the highly lucrative new market has sparked a new frenzy in China, with companies and local governments now competing for market share.
According to a 2019 e-sport report, six cities in China are now vying to become the country's e-sports hub.
The cities taking part in the competition include Shanghai, Xian, Sanya, Hangzhou, Chongqing, and Haikou. The six cities are reportedly actively bidding on different high-profile e-sport events, with some offering incentives and sponsorship deals. Hong Kong recently announced that it would be holding a two-week e-sports event his week.
Large Chinese companies such as Alibaba are also heavily investing in the e-sports scene. Alibaba Group Holding currently has its own top tier e-sports tournament, which it holds in different cities around China throughout the year.
China's positive response to the budding new industry has also now attracted international organizers. US companies such as Super League has expressed interest in holding future events in China, potentially bringing in millions of dollars in revenues to local businesses. The CEO of the NASDAQ-listed company mentioned that Asia, and particularly Greater China, is slowly becoming the go-to place for global gamers and e-sports fans.
