Trends of China's E-Sports Viewership 2017

Trends of China’s
E-Sports Viewership 2017

Statement
Sampling & Accuracy
User data in this report, unless stated, are all collected from independent surveys conducted by Penguin Intelligence and Tencent
IEG’s big data platform. 23,365 mobile internet user samples were collected. Unless stated specifically, all surveyed users refer to
Chinese mobile internet users. According to latest data released by China Internet Network Information Center (CNNIC), mobile
internet users account for 95% of China’s internet users. Thus, all related conclusions drawn in this report based on user surveys
can be applied to all Chinese internet users. Stratified sampling processing has been applied for data used in specific segments
research.
Definitions
02
E-Sports: a business sector based on video games but also has
values beyond games with unique business value and users’
value of technology, athletics, entertainment, and social aspects.
E-Sports Audiences: Audiences who have watched E-Sports and
have a certain level of understanding of E-Sports.
Players: Amateur players who have participated in E-Sports
competitions.
Copyright of the English version of this report is owned by
Penguin Intelligence, China Tech Insights and the cooperative
partners jointly releasing this report. Any use of this report,
including reprint and reference, shall be cited with source and
without deletion or modification of the content. For other
usage of this report, please contact us via
rhealiu@tencent.com. A Chinese version of this report can be
found at re.qq.com. For inquiries concerning the content of
this report, please contact miaxtzou@tencent.com.
Copyright Statement

Website: www.chinatechinsights.com
Twitter: @CNTechInsights
WeChat: ChinaTechInsights
Data+Research+Consumer
China Tech Insights is an industry research project established
by Penguin Intelligence at Tencent Online Media Group in
2016. We cover trending topics in China’s tech sphere through
investigative reporting, meticulous interviewing, surveys, and
research, along with professional opinions provided by top-
notch business insiders.

E-Sports for Everyone
03
E-Sports, as an emerging new sector in China, is advancing at the speed of light. In 2016, E-Sports became an
important part of China’s gaming industry with a market valued at 3 billion USD and 170 million users. Along with the
expansion of E-Sports, we see an increasingly mature industry with blooming niche sectors. Related businesses,
including copy right distribution, fan-based operations, franchise and e-commerce, will also see an increase together
with E-Sports.
Penguin Intelligence joins hands with Tencent E-Sports have launched this report based on product data, consumer
surveys, and industry insights. In this report, we’ll discuss:
• The profile of E-Sports audiences in China and their behaviors
• Most popular fields in Chinese E-Sports
• Opportunities in each link of the value chain
• User expectations for future tournaments

Highlights of the Report
04
• 60% E-Sports audiences are under 25; the penetration rate of E-Sports in China’s 2nd tier cities has grown to
48%
• 79.8% E-Sports audiences choose to watch tournaments at home while 1/3 of audiences have the
experience of watching tournaments at net cafés
• More than half of E-Sports audiences watch tournaments for more than an hour each time; 21.5% of
audiences even watch more than 2 hours
• 34.1% of E-Sports audiences are willing to buy a ticket to watch the competitions onsite
• 37.5% of E-Sports audiences look forward to the application of VR in game streaming

The New E-Sports Era in China01
E-Sports Audience Overview02
An Explosive Viewership03
The Value Landscape of E-Sports04
Business Opportunities for E-Sports in China05
The Future of E-Sports in China06
Contents

The New E-Sports Era
• The Development of E-Sports
in China
• How E-Sports Became a
National Affair
01

The Start of China’s Mobile
E-Sports Era
08
1998-2008
Single-Player
PC Game Era
2008-2016
Multiple-Player
Online Game
2016-Present
Mobile Game Era
Low Internet
penetration rate
A limited market
Online video games
prevailed
E-Sports begin in
China
产业开始深化并进行结构调整
High adoption of
smartphones
A year of mobile
game tournaments
WCG, ESWC, CPL
LOL, Crossfire,
Dota, Hearth Stone
King of Glory, Crossfire:
King Shootout,
Vainglory
Signature
Games
Feature
Tournaments
Quake, Counter Strike,
Warcraft III, WOW
LPL, CFPL, DNF Fight
Pro-league, TGA
KPL、CFM

Chinese E-Sports Users to
Pass 2 Billion
09
The global E-Sports market is growing at a high speed. North America still leads the market in
terms of revenue as China contributes 15% to the global market. In 2016, China’s E-Sports market
has gained 170 million users, and is expected to hit 220 million at the end of 2017.
Global E-Sports Revenue, 2016
North
America
38%
China
15%
Korea
8%
Other
Regions
39%
$463M
2016
Source: Newzoo, iResearch, Tencent IEG
Chinese E-Sports Users
(Unit：100M)
0.8
1.2
1.7
2.2
2.8
2014 2015 2016 2017F 2018F

450 Million Potential
Audiences in China
10
％
65.7
I haven’t seen a match
before, but have plans to do
so:
10.9%
I have watched
E-Sport games:
46.0%
I have participated in
E-Sport games:
8.8%
I'm not interested in
E-Sports: 34.3%
Source: Penguin Intelligence Survey
Engagement of E-Sports Users  8.8% of respondents participated in E-
Sports. Over 65% of respondents are
interested in E-Sports.
 Considering China’s current mobile
internet users of 695 million*, there’s a
potential market of 450 million users in
China.
*Source: CNNIC, 39th Statistical Report on Internet Development in China

Mobile Games Lead
the Trend
11
Client Games:
35.2%
Browser Games:
11.3%
Mobile Games:
49.5%
Others: 4.0%
Market Shares of Video
Games in China, 2016
Source: 2016 China Gaming Industry Report, co-launched by GPC, CNG & IDC
In 2016, we reached a milestone that the market shares of mobile games surpassed client games to
reach 49.5% and became the biggest niche in China. The population of mobile E-Sports users also
surpassed that of PC E-Sports users. Mobilization has become an inevitable trend.
PC Mobile
Population OF China’s E-Sports
Users, 2016
(Unit: 100 Million)
Source: Tencent IEG Big Data
+50MN

18.3%
59.3%
Totally Agreed
Agreed
Neutral
Disagreed
Totally disagreed
The Social Recognition of
E-Sports in China is Rising
12
Social Recognition of E-Sports
as a Competitive Sport
％
77.6
 In 2003, the General Administration of Sports of China listed
E-Sports as the 99th official sport in China
 In 2004, CPL began to operate in China
 In 2012, E-Sports was proposed as an official Olympic sport
for 2020
 In 2016, to accelerate the development of E-Sports in China,
E-Sports was officially discussed in an executive meeting of
the State Council
As E-Sports developed in China over the past decade, more formal
competitive entries appear. E-Sports is no longer regarded as
entertainment, but a holistic competitive sport genre.
Institutional Recognition Increased
77.6% of E-Sports audience agreed
that E-Sports should be taken as a
sport. Almost 60% users showed
high recognition.
Source: Penguin Intelligence Survey

An Overview of
E-Sports Audiences
• Who are E-Sports Audiences?
• Audiences’ Behaviors
02
• The Training of Professionals

Young Men from 2nd Tier Cities Make
up the Majority of E-Sports Audiences
14
81% 19%
Female Players
Take up 19%
30 is the Watershed &
64% Users are 25-
E-Sports Has the Highest Penetration Rate
in 2nd Tier Cities
20%
44%
26%
10%
1%
Under 21 21- 25 26- 30 31- 40 Above 40
12%
41% 17% 17% 13%
45% 48% 43% 46% 45%
1st tier 2nd tier 3rd tier 4th tier 5th tier &
below
User Distribution
User Penetration
Source: Penguin Intelligence User Survey
Distribution: the percentage of users in all tiers of cities
Penetration: Population of E-Sports users in these cities/ All
samples from these cities

User Profile: Students + High Income
Families
15
69% Users are under
College Age
24% Users are from Families of
RMB 10,000+ Monthly Income
24% of E-Sports Users are
Students
16.5%
28.4%
17.3%
14.1%
14.8%
8.9%
Under RMB 3,000
RMB 3,001-5,000
RMB 5,001-7,000
RMB 7,001-10,000
RMB 10,001-20,000
Above RMB 20,0003%
28%
60%
9%
24%
14% 14% 13%
8%
Students
Blue-collar
workers
White-collar
workers
Freelancers
Individual
businessowner
Junior High
& Below
Senior
High
College
Post-grad
& Above
Household
Monthly
Income

％
User Profile: Most Audiences Choose
to Watch with Their Friends
40.6
16
40.6%
34.4%
12.9% 9.2%
3.9%
36.3%
Who do you watch E-Sports with?
 40.6% of E-Sports audiences chose to
watch games with their friends. 34.4%
chose colleagues/classmates.
 It is worth noting that 36.3% of all E-Sports
audiences choose to watch games alone.
More online game watching use cases can
encourage these users to have better social
connections.

Home and Net Café are Primary
Locations for Game Viewing
17
79.8%
37.2%
20.7%
7.3% 5.6%
Locations for Watching
a Game
Time Duration for Game
Watching
15.4%
30.6%17.6%
14.9%
21.5%
Below 30 mins
30-60 mins
60-90 mins
60-120 mins
More than
120mins
37.2% of E-Sports users choose to watch at Net Cafes; high speed network and the group watching
atmosphere may be the main considerations. 54% of E-Sports users watched more than 1 hour, and 21.5%
watched more than 2 hours. The competition has a strong hold on the audience, which has given relevant
event media (especially live streaming platforms) super strong user stickiness.

E-Sports Audiences Love to Share
18
41.1%
33.3%
28.3%
22.5%
20.4%
15.2%
Share with friends
Search other relevant information
Discuss with others on gaming platforms
Discuss with others on general platforms
Share information to social network
"I won't share or search relevant information"
Actions After Watching a Game
％
41.1
 After the event, 84.8% of E-Sports
audiences would still do something
relevant to the event, like "sharing
(sharing with friends)“ and “enjoy the
aftertaste (viewing other related
information).”
 The information chain of the competition
continues after the game. It’s worth
paying attention to post-game content
marketing as well.

Alternative Life Experience is the
Main Drive for Professional Players
19
Occupational Expectation to
E-Sports
“When will you consider yourself to be a
professional players?”
39% of amateur players have long-term career plan to be professional players. Strongest desires are from
young people under 25. Demand for professional training is high among young people. The selection and
training planning setups need to speed up. For professional players, an alternative life experience is a
stronger drive to develop a professional game player career compared with pure financial incentives.
61%
9%
19%
11%
Just an interest
Want to turn it into a job
Want to become an expert
Want to make it a life cause
Get a different life experience
Have an outstanding income
Show and share my skills
Earn a sense of achievement
Get fun
Get others' attention
"I won't consider to be pro"
(Amateur Players Only)
(Audiences Only)
“When I can…”

Explosive Viewership
• Viewership of Top Competitions03
• Level of Popular Competitions
• Types of Popular Competitions

Game Copyright Distribution
Landscape of E-Sports in China
21
Game
Developers
Supervisors
Game
Publishers
Sponsors
Content Creators
Game Organizers
Talent Agencies Clubs & Associations
Players Commentator
Gaming TV
Channels
Game Media
Live Streaming
Platforms
UsersChannels
E-Commerce
Content Authorization
Game Organization Game Participation
Game Broadcasting
Game Distribution
Supervision
Game
Authorization
Participation
Monetization
from Fans
User Engagement Commodity Sales
Content
Monitoring
Ad
Collaboration
User Engagement

Top E-Sports Tournaments Revenue
Close to Traditional Sport Competitions
22
5 Billion
+
LOL Professional League
(All Game Seasons in A Year)
Viewership Across Platforms in One Game Season
In 2016, with promotion via online media, especially live streaming platforms, E-Sports have attained unprecedented
media attention. The annual viewership of the LOL Professional League reached a cumulative 5 billion viewers. The
revenue generated by an E-Sports competition can match that of traditional sports.
700 Million
+
Cross Fire
(All Game Seasons in A Year)
Dungeon & Fighter
(All Game Seasons in A Semi-Year)
130 Million
+

Classic E-Sports Competitions
Outreach to 100 Million+ Audiences
23
2016 Twitch Popularity Rank — Cumulative Viewership
DOTA2 Hearth Stone Overwatch
480 Million
+
460 Million
+
160 Million
+
Source: Twitch

KPL Tournaments Have
Phenomenal Success
24
In 2016, KPL created the fastest-growing viewership record in the history of E-Sports with an
accumulative 560 million times viewing in a 22-day gaming season.
In 2016, total
viewership in a 22-
day session:
560 Million
Viewership of KPL(King Pro League)
In 2017, total
viewership for the
Spring Season:
2.1 Billion

％
Nation-wide Professional Games
Show Strongest Traction
62.2
25
62.2%
45.5%
11.4% 6.9%
24.4%
Pro League International
League
City-level
League
School
League
No Preference
Level of Competitions with
the Most Attention
 In all levels of E-Sports, nation-wide professional
leagues drew the most attention in E-Sports
audiences, followed by international games. There
are also 24.4% of E-Sports users who have no
fixed preference for the game level, including
audiences who choose their preferences based on
game types rather than level.
 The soaring popularity of KPL, LPL, and other E-
Sports professional games are improving the
development of E-Sports as a professional sector.Source: Penguin Intelligence User Survey

MOBA Competitions Have
a Dominating Popularity
26
63.2
Most Viewed Game Type
MOBA
％
63.2%
46.9%
31.2%
14.6% 12.2% 8.8% 7.4% 6.0% 5.7% 4.4%
MOBA Action &
Fighting
Game
Shooting
Game
Racing
Game
MOK Board &
Card
Game
Sport
Games
Parkour
Game
TCG Music
Game
Strategic and operational Multiplayer Online Battle Arena (MOBA games, such as King of Glory) competitions are
the most popular type among E-Sports audiences. Apart from the huge user base of the game, the strong
emergence of the game and the mature game operations are also essential to its success.

The Value Landscape of
E-Sports
• The Direction for Development
• User’s Focus Point
04
• Value of Promotion Channels

Professionalism of E-Sports is
Well-recognized
28
“In your eyes, E-Sports is…”  At present, 70% of E-Sports audiences
show high recognition for E-Sports in
various sectors.
 Most users recognize the
professionalism of E-Sports. High level
professional leagues also receive the
most attention from users.
Occupational Entertaining Emerging Widely
particpatory
70%

29
User Focus Point Map of E-Sports
Competitiveness
Professionalism
Internationalism
Entertainment
Game
Atmosphere
Scale of the
Competition
Viewing
Experiences
Rewards
 Audiences’ attention to E-Sports
games are now shifting from
focusing on only graphic experiences
to a diversity of dimensions. Based
on Penguin Intelligence’s Focus Point
Map, audiences now focus most on
the competitiveness and
professionalism of a game.

Primary Media Channel:
Vertical Game Sites
30
55.7%
41.0%
26.1%
24.6%
21.0%
15.7%
15.4%
6.8%
Game Sites(Official Site/APP)
Portal News Sites
Search Engine
Social Media
Forums
Clubs/Teams
Friends
TV/Broadcast/Print
Channel for E-Sports Information
％
55.7
 Channel-wise, the distribution of
game-related information is still
highly dependent on users’ proactive
searches. Social channels haven’t yet
revealed value in E-Sports-related
contents distribution.

Business
Opportunities of
E-Sports in China
• Demands for Game-related Events
• Audiences’ Paying Potential
05
• E-Sports’ Investment
Opportunities

A Tipping Point for E-Sports
32
Low Professional Level
Underestimated
Business Value
Immature
Business Eco
Three Pain Points
• Professionalized game content and operation
• Customized copyright operation strategy
• Co-development of fan engagement together
with sponsors
• Regulated business eco for future development
Compared with mature E-Sports business operation in Europe and the North America, the commercialization of E-Sports in
China is still at the exploration stage. Pro Leagues are now bringing together many professional players and clubs. By
establishing industry-wide standards on income distribution, event agency model, professional training models, and other
sectors, it’s building up a mutually beneficial ecosystem for all stakeholders in the business.
League Model
A mutual-beneficial system for
organizers and clubs
100+ Pro Players12 Clubs
KPL
Open
&
Share
Local
ize
Profe
ssion
alize
KPL Founded

Business Opportunity: Copyright
Distribution & IP Development
33
 Nearly 40% of respondents showed interest in
gaming live streaming/broadcast, which is the
core value of E-Sports in the eye of the user.
Second, game commentators, top teams, and
star players are more likely to see a fast boost
in fame.
 From the core of copyright distribution to the
extension of IP development, E-Sports shows
a great variety in business possibilities in the
long run.
Game
Streaming
39.7%
E-Sports
Commentary
E-SportsStars,
Teams,&Clubs
E-SportsFiction,Movie,
Comics,Animation
E-SportMusic
E-SportsRelatedNews
E-SportsRelatedApparel,
Toys,&Decorations
E-SportsRelated
RealityShows
35.4
%
31.2
%
27.4
%
22.2
%
19.2
%
18.8
%
16.1
%

Users Show Great Paying Willingness
34
34.1%
30.7%
27.9%
24.0%
19.3%
19.3%
17.0%
16.4%
Tickets for Onsite Game Watching
Hi-Resolution Streams
Ad Removal
Lottery for Franchised Products
Right to Interact with Teams/Stars
Multi-view Shooting
High Speed Streaming
Game Commentary
Products Users are Willing
to Pay for
 Tickets for top-level professional games are often
sold out immediately after release. Onsite game
watching experiences have also gained users’
highest willingness to pay. The demand is far
from satisfied with an enormous market potential.
 Other sectors users are willing to pay for include
high-definition quality streams and ad removal
service. Users also expect more innovative
privileges.％
34.1Source: Penguin Intelligence User Survey

Users’ Expectations in the Future
35
47.1%
41.5%
37.5% 36.4% 36.3% 36.1% 34.7% 33.3% 33.3% 32.5% 31.8%
28.3%
24.4%
18.7%
Users’ Expectations for Different Aspects
In the future development of E-Sports in China, users have the highest expectation for the improvement in the
competition system & future directions (e.g. fair rules, professionalization, and internationalization) as well as new
technology application (e.g. VR) and viewing experience optimization. Audiences also expect players’ and
commentators’ skills to be improved.
System/ Direction
Content
Tech/Experience
Channel/Marketing

The Dawn of E-Sports in China
37
2016 is a year of opportunity for E-Sports. In April, the National
Development and Reform Commission (NDRC) proposed to list E-
Sports as one of the top ten transformative consumer activities. In
July, the National Sports Industry General Bureau issued the
"Sports Industry 13 Five Plan," mentioning an acceleration of the
development of E-Sports and other related sports and fitness
industries. In September, the Ministry of Education include E-
Sports as an additional specialty in the Declaration of Enrollment
of the 2017 Higher Vocational Schools. The development of E-
Sports industry began to enter the fast lane under various policies
and became mainstream.
Supportive
Regulations Lead
E-Sports into the
Mainstream
1

Professionalization is Now a Trend
38
2
In 2017, China's E-Sports audiences were expected to surpass 200
million. Positive promotion and direction usher in an increasing
social recognition of E-Sports. With a large existing and potential
user base, China's E-Sports shows a quick catchup to traditional
sports and even a capacity to lead in the field.
38.5% of amateur players have a long-term career goal to turn
professional, especially among players around 25. It has great
potential for the development of training services for areas such
as professionalized competition, talent agencies, and game
operations.
Professionalization
Accelerates the
Development of
Related Fields

Technology Brings an Elevation of
Viewing Experiences
39
3
In 2016, in the KPL, AR was applied in mobile E-Sports
competition streaming for the first time. League of Legends and
DOTA2 have also set up their own VR watching system.
The new technology has given the audience a new visual
experience and unexpected impact.
In the survey, nearly 40% of users are looking forward to the
application of VR technology and an upgrade of viewing
experience. No matter the AR presentation onsite, VR on live
streaming platform, or OB perspective optimization, all these
technologies are waiting for breakthroughs for an even better user
experience.
Technological
Innovation Creates
New Experiences

Create More Options for
Game-viewing
40
In terms of game-related information acquisition, more than half
of audiences still rely upon proactive research. The power of
communication via social channels is yet to be realized. But about
half of all users will share information with friends after watching
games. Social channels still have the potential to be important
channels for game-related information distribution.
It’s also worth noticing that about 40% of audiences watch games
alone. More options for game-watching, such as organizing fan
clubs and offline game-watching events, may possibly be a
direction for the future of E-Sports as a social event.
Use Social
Channels to
Expand
Influence
4

Great Potential for Advertising
41
A Rising
High Quality
User Group
5
Although E-Sports have accumulated a large amount of users, the
average revenue per capita is less than US$ 4. Even though some
institutions predict that the figure will grow to US$5.2 in 2017, it’s
still less far less than those of basketball, football, and other
mature sports. There’s still a long way to go for the
commercialization of E-Sports, but at the same time it is a great
opportunity.
E-Sports audiences in China are young and willing to adventure
with a good average family income, and they are also the target
of many brands. In comparison with high-priced advertising for
super events like Super Bowls, the return on sponsorship is more
rewarding.

Chances Also Lie Offline
42
Develop With
E-Sports Venues
at Core
6
From game development to event organization, and then to the
prosperity of E-Sports spin-off sectors, E-Sports industry parks will
see industry-wide prosperity with game organization services at its
core. At the same time, E-Sports industry parks will also support
the development of the entire E-Sports ecology to achieve a
mutually beneficial business model.
Users’ high willingness to pay for onsite viewing experiences also
offers the foundation for the expansion of offline E-Sports venues.
The development of E-Sports industry parks also shows more
future opportunities for offline E-Sports services.

Trends of China's E-Sports Viewership 2017

More Related Content

Recently uploaded

Featured

Trends of China's E-Sports Viewership 2017