Weibo Esports Acquires TS Gaming QQ Speed Squad, Newzoo Partners With Hainan Resort Software Community
Last week was significant in China’s live streaming and short-form video industry, as U.S. President Donald Trump on Thursday signed executive orders to ban transactions with Tencent Holdings’ WeChat and ByteDance’s short-form video app TikTok. This news caused Tencent Holdings to lose market valuation of roughly $54B USD on Friday.
On Monday, Tencent sent preliminary non-binding proposal letters to DouYu and Huya, asking both companies to enter into a stock-for-stock merger. Tencent is the largest shareholder in both companies. As of the end of Q2 2020, both live-streaming platforms have a combined enterprise value of $8.9B and 333.8M monthly active users distributed over both platforms.
Tencent Holdings plays a vital role in China’s esports industry. The company also released its 2020 Q2 financial reports on Wednesday. The company generated a revenue of ¥114.9B RMB ($16.56B), up 29% from ¥88.8B ($12.79B) in the same period of 2019. The company recorded total game revenues of ¥46.9B ($6.8B), representing 40.8% of Tencent’s total revenues. Online game revenues grew 40% year-over-year primarily driven by higher mobile games revenues from titles such as Peacekeeper Elite and Honor of Kings. PC games revenues for Q2 2020 were ¥10.9B ($1.57B), while mobile games revenues were ¥36B ($5.18B). In total, Tencent reported ¥32.5B ($4.6B) in profits, a 31% year-over-year increase compared to ¥24.7B ($3.6B) in Q2 2019.
The Chinese esports industry also welcomed its first offline esports event with a live audience after six months under the shadow of the COVID-19 pandemic. The Beijing Information Office and Tencent announced Aug.7 that the Honor of Kings World Champion Cup Final would have a few tickets available for sale. The final will begin Aug.16 at Beijing Cadillac Center.
Among the other top stories in China’s esports industry: Chinese social media Weibo acquired TS Gaming’s QQ Speed division and its franchising spot at QQ Speed S League; Chinese new energy vehicle maker Xiao Peng sponsored esports organization LNG Esports; and Newzoo announced a partnership with China’s Hainan Resort Software Community (RSC).
Weibo Esports Acquires TS Gaming QQ Speed Division
On Aug. 6 Weibo Esports, the esports arm of Chinese social media Weibo (the Chinese equivalent to Twitter and Instagram), announced that the organization has acquired Chinese esports organization TS Gaming (TS) QQ Speed division.
The acquisition included all TS QQ Speed players as well as the franchising spot at Tencent’s top QQ Speed esports league, QQ Speed S League.
Sources close to the deal told The Esports Observer that Weibo Esports is also considering acquiring the entire organization, including its Honor of Kings division with the KPL franchising spot.
Li “Sky” Xiaofeng, founder of hardware company Taidu, and board member of esports organization Xi’an Team WE, also indirectly confirmed this acquisition by saying “One of my rich friends is acquiring TS,” during a stream while watching Honor of Kings competitions.
Xiaofeng is an iconic symbol in the Chinese esports history who recently became the newest brand ambassador of energy drink brand RedBull on Aug. 7.
Financial terms of the deal were not disclosed.
In June TEO reported that Chinese esports organization YTG Gaming (YTG) was expected to sell its Honor of Kings team and players for an initial bid price of ￥61M (￥8.6M) .
TS has become one of the current best-performing Honor of Kings teams in China. The team won the 2020 King Pro League (KPL) Spring Split, and currently competes in the Honor of Kings World Champion Cup as the first team entering the top four of the event.
Newzoo Partners With Hainan Resort Software Community
Newzoo (a sister company of The Esports Observer) announced that it signed a strategic partnership deal with China’s Hainan Resort Software Community (RCS).
According to the announcement, the partnership will help Newzoo to expand its business in China and provide better marketing intelligence and data analysis services to China’s gaming companies that plan to expand their business overseas. As a part of the deal, Newzoo will become one of the co-founders of Global Games Industry Alliance, led by RSC.
Hainan has been investing in esports since Tencent hosted the Tencent Annual Esports Global Summit last year in the province. Tencent will host the summit in Hainan again on Aug.24.
Chinese New Energy Vehicle Company Xiao Peng Sponsors LNG Esports
Chinese esports organization LNG Esports (LNG) signed a sponsorship deal with Chinese new energy vehicle company Xiao Peng. Xiao Peng’s logo will be featured on LNG’s team jersey during the League of Legends Pro League (LPL).
Financial terms of the deal were not disclosed.
LNG is owned by Chinese sportswear company Li-Ning and currently has two sponsors, including Xiao Peng and Intel. This is not the first time that Xiao Peng has been a sponsor in the Chinese esports industry. The company sponsored the $420K NetEase esports X Tournament (NeXT) Summer Season this year alongside Chinese smartphone brand Huawei.
Other Esports Business News:
- Bilibili Esports signed a strategic partnership deal with hardware brand Logitech G at China Digital Entertainment Expo & Conference (ChinaJoy) in Shanghai. The two companies will focus on building “in-depth esports content for young audiences,” according to the announcement.
- China Ping An Bank also signed a strategic partnership deal with Bilibili Esports. Ping An Bank is a commercial banking institution owned by Ping An Insurance Group Company of China, Ltd, and is top 21st of Fortune’s newest Global Top 500 Company list.
- Both Chinese live streaming company DouYu and Huya released their Q2 financial reports. DouYu reported $45.1M in profits in Q2, while Huya reported $32.1M in profits.
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