Tencent Holdings Allocates $15 Billion Investment for Chinese Esports
Chinese behemoth Tencent Holdings Limited has announced a five-year plan to expand the esports market in the country by investing nearly $15 billion.
According to a report from Caixin, the company is interested in nurturing upcoming and existing talent. China is already home to a formidable and booming competitive setup. Tencent now wants to accelerate that growth by forming new leagues, and setting up various associations to increase the number of tournaments. This ambitious plan also includes the construction of esports-themed parks in the country.
To put that gigantic investment into perspective, Dot Esports highlights how the global esports market is expected by analysts to surpass $1 billion in the next couple of years.
Tencent is the largest gaming company in the world. It owns League of Legends’ developer Riot Games, and has a minority stake in both Epic Games and Activision Blizzard. In addition, it owns a majority stake in Finnish mobile game developer Supercell. These are only a few of its investments, making Tencent heavily involved in the gaming scene. Hence, it is only logical for the company to expand its horizon by injecting money into the trending esports industry.
Incidentally, League of Legends is moving towards franchising this year. China will be the first region to remove the existing relegation system and open up slots for franchise owners with the start of the Summer Split. North America and Europe are expected to follow suit next year. This leaves only South Korea, which is not interested in the new business model for now.
The $15 billion investment from Tencent will likely push China to make full use of the franchising aspect. It should also force big names in the west to open up their wallets and drop their money into the regional competitive scene.