Video gaming
Get more with myNEWS
A personalised news feed of stories that matter to you
Learn more
Young people play video games at an internet cafe in Beijing September 10, 2021. Photo: AFP

Shenzhen aims to become global esports hub by promising cash rewards, subsidies to gamers

  • Esports games developed in Shenzhen qualify for 2 million yuan in cash rewards, and can receive 5 million yuan if selected by major gaming competitions
  • Shenzhen is home to more than 4,000 video gaming companies, including global leader Tencent Holdings, and they generated 160 billion yuan in sales last year
Video gaming

China’s southern tech hub of Shenzhen has pledged generous subsidies and rewards in an ambitious plan to turn the city into an international esports hub, following similar proposals by Beijing and Shanghai, despite the country’s tightened controls over video gaming and live streaming.

The Shenzhen government laid out a road map for the next five years to strengthen the city’s esports industry by encouraging original esports game development and giving support to teams, tournaments and arenas, according to a draft plan issued by the city’s Culture, Radio, Television, Tourism and Sports Bureau on Friday. The bureau is soliciting public opinion on the plan through to October 24.

Under the plan, esports games developed and launched in Shenzhen can receive up to 2 million yuan (US$280,000) in cash rewards, depending on their popularity, and qualify for 5 million yuan if selected by major gaming competitions.

China’s rigid Covid-19 control measures put a damper on local esports market

“The esports industry is an important part of the development of the digital economy, with enormous market size and high level of technology,” the culture and sports authority said. “Compared to other esports hubs at home and abroad, [Shenzhen] still has obvious shortcomings in terms of a limited value chain, lack of high-level professional clubs and tournaments, and esports venue infrastructure that is lagging behind.”

Shenzhen is home to more than 4,000 video gaming companies, including global leader Tencent Holdings, and they generated 160 billion yuan in sales last year, accounting for over half of the country’s total game revenues, according to the culture and sports bureau. Game for Peace and Honour of Kings, popular mobile games developed by Tencent, have both launched professional teams and tournaments.

Under the five year plan, the city will also invite leading esports companies, teams and tournaments from across the world to come to Shenzhen, enticing them with rewards ranging from 5 million yuan to 8 million yuan.

Local teams will also be cultivated, and those featuring “Shenzhen” in their team name qualify for 2 million yuan in subsidies per season, and 5 million yuan if they perform well in major competitions.

Nvidia’s new AI-focused chip produces more realistic images in games

The government also pledged to build one or two large-scale arenas that meet international standards for top tournaments over the next five years, and to cultivate an ecosystem for the esports industry using cutting edge technologies such as artificial intelligence and virtual reality.

Local universities and vocational schools are also encouraged to offer esports courses and build labs to nurture talent for the industry.

Shenzhen’s plan comes as the central government continues its complex and often contradictory stance towards gaming and esports. Beijing imposed an eight-month licensing freeze on new game titles, before the approval process resumed in July with a smaller number of licenses issued.

Fans watch the EVO 2022 Tekken 7 tournament at Mandalay Bay Resort and Casino, Las Vegas, August 07, 2022. Photo: AFP

In the first half of 2022, total revenue for Chinese video gaming companies fell 1.8 per cent year on year, marking the first market decline since data became available in 2008.

In an effort to protect Chinese youth from gaming addiction, Beijing also tightened playing restrictions, limiting gaming time for players under 18 to between 8pm and 9pm only on Fridays, Saturdays, Sundays and statutory holidays. That has made it nearly impossible for the country’s esports sector to form and train under-18 groups of players.
Nonetheless, China has been promoting esports, with many cities including Beijing, Shanghai and Hangzhou vying to become the country’s main esports hub by offering various incentives. Beijing, for example, launched an ambitious initiative called “Esports Beijing 2020” to provide major subsidies to teams, arenas and video games that promote local culture.

At stake is the world’s biggest esports market, which has reached 167 billion yuan in size with 506 million users in China, according to a report by iResearch in May. Globally, esports will generate nearly US$1.38 billion in revenues by the end of 2022, and China will account for nearly one third of the worldwide esports revenues, according to Newzoo.