Tencent gets respite from crackdown with ‘League Of Legends’ hits

Tencent’s successes come after Beijing has imposed a broad crackdown on the country’s games industry, hurting the stocks of Tencent and other companies. — Reuters

Tencent Holdings Ltd pulled off a pair of successes for its League Of Legends franchise over the weekend, with a raucous eSports tournament that drew more viewers than ever before and the strong debut for a new video series on Netflix.

Arcane, an anime series based on the League fantasy universe, premiered to an overwhelmingly positive response, garnering 130 million views in China within a few hours and becoming the most searched show on Tencent’s streaming site. Globally, the show – co-created by the Tencent-owned game maker Riot Games Inc – is streamed on Netflix Inc’s service as well as Amazon.com Inc’s Twitch.

Riot’s promotional push around Arcane included a live premiere event in Los Angeles and advertisements posted at bus stops around the city. Epic Games Inc, also partly owned by Tencent, even debuted a League hero in its hit Fortnite game.

Earlier in the weekend, the League of Legends World Championship hit a record of more than four million concurrent viewers tuning in, according to Esports Charts. That was without including audiences in China, which provided the winning team for this year’s event and where a replay of the match has been watched more than 11 million times on Tencent-backed Bilibili Inc. The streaming service said cumulative views of the finals night grew 20% from the previous year without disclosing the exact number.

Chinese eSports stocks surged after the event, with the tournament’s topic of the home team winning viewed more than three billion times on the microblogging site Weibo Corp. Dalian Zeus Entertainment and Hangzhou Electric Soul both rose by the 10% daily limit.

The successes come after Beijing has imposed a broad crackdown on the country’s games industry, hurting the stocks of Tencent and other companies. In August, authorities said children could play video games just three hours a week in most cases.

Long dominant as the go-to games publisher and platform within China, Tencent has invested heavily in expanding that lead into a wider entertainment ecosystem. The company is funding talent agencies, streaming sites – including its own version of Twitch for global markets, called Trovo Live – and tournament organisers to create the infrastructure necessary to turn pro gaming from a niche into an instrumental part of its growth.

Key to the strategy is the mutually reinforcing effects of shows like Arcane benefiting from a huge built-in audience to gain notice and then using that notoriety to introduce more people to the game. League Of Legends has more than 100 million players globally. Riot Games is also making clips from Arcane available for people to remix and create fresh online content with, effectively harnessing the game’s fan base to extend the promotional reach. – Bloomberg