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,Tencent reaches most people outside China through games like PUBG Mobile – among the most popular mobile eSports titles in South-East Asia – and League Of Legends, which is regularly played by tens of millions worldwide. — Reuters

At the height of the global pandemic in October, more than 6,000 people packed into a new 25-acre stadium in Shanghai to watch one of the world’s biggest sporting contests. Another 45 million tuned in online, about as many as watched the six games of the 2020 NBA Finals on TV. The matchup was the League Of Legends world championship – a watershed moment for competitive gaming and its organiser Tencent Holdings Ltd.

Asia’s most valuable company has set its sights on a billion-dollar eSports arena that already boasts more regular viewers than the National Basketball Association or the National Football League. Tencent has placed pro gaming at the heart of its ambition to dominate online entertainment, from mobile games and video streaming to social media. It’s betting that esports will entice and retain the Internet audiences it needs and eventually grow to something approaching the US$10bil (RM41.35bil)-plus NBA.

Key to realising that vision is Tencent’s blockbuster League Of Legends battle arena title and TJ Sports, the outfit it set up in 2019 to organise and promote the game’s competitive play in China. While total revenue in TJ’s first two years just surpassed 1bil yuan (RM631.75mil), the fledgling company intends to create original content such as reality shows and livestream channels around its star players and teams, and peddle merchandise.

“eSports is like the Super Bowl, which isn’t just a sport event but also a vehicle of art and entertainment,” said TJ co-chief executive officer Leo Lin. “We are going for the direction of connecting eSports with our games and wider entertainment business.”

eSports show how Tencent thinks about its long-term future. The world’s largest games publisher has invested billions of dollars in talent agencies, streaming sites and tournament organisers to create the infrastructure necessary to turn pro gaming from a niche into an instrumental part of its growth strategy. TJ expects to double overseas viewership as soon as this year and aims to do the same with media rights revenue from outside China.

“Tencent’s investing in eSports for the long haul, because it breaks the boundaries between different businesses from licensing to sponsorships and ticket sales,” said Chundi Zhang, a gaming *** yst with Ampere Analysis. “Especially with competition for attention intensifying and user acquisition costs growing in the gaming market itself, esports still has huge untapped potential.”

Shenzhen-based Tencent, which operates some of China’s largest Netflix-style and e-book services as well as producing tentpole films and games, already knows how to monetise popular content.

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