eSports revenue in China grew 25% year on year to reach 117.5bil yuan in 2019, boosted by official recognition of the sector, according to iResearch Consulting Group.

The Shanghai-based research firm reported that eSports revenue, including income generated by games, tournaments and merchandising, passed the 100bil yuan milestone for the first time. The market is expected to rake in more than 165.1bil yuan in revenue by 2021.

Rapid growth of eSports in China is an example of the convergence of online gaming and live-streaming - two prominent pillars of digital life in China - with companies and the public sector alike looking to the lucrative new sector for growth.

“With eSports players becoming a government-recognised profession and yet another Chinese eSports club winning the League of Legends World Championship 2019, the government, investors and brands have been devoting more care and enthusiasm to the e-sports industry,” iResearch said in the report.

While the bulk of the revenue is generated by eSports games themselves, that is changing. Mobile games and PC games accounted for 47.2% and 24.7% of total revenue respectively but revenue generated by the ecosystem, including advertising and merchandising, currently accounts for 24.7% and is on track to account for one third of the market by 2021.

The report said there were 470 million eSports consumers in China, defined as anyone who has watched at least one eSports game within a six-month period - and about 76% of those are male.

But regulation has been an obstacle to growth, with Beijing tightening the game approval process and mandating strict anti-addiction measures by limiting play time and spending limits for underage gamers.

Under a new law passed last year, users under 18 years of age are banned from playing games for more than 90 minutes each day. On holidays, the play time limit is extended to three hours. Underage gamers are also banned from playing games before 8am and after 10pm.

Spending is banned for gamers under eight years of age and capped at 200 yuan per month for eight- to 16-year-olds and 400 yuan for those between 16 and 18.

Stricter regulation notwithstanding, government support for the sector was evident in 2019, iResearch noted. Local governments in Shanghai and Hainan have actively courted eSports tournaments and encouraged gaming companies to host events and invest, while state media like People’s Daily actively covered eSports last year.

 - SCMP