Esports Became the Theme of ChinaJoy 2017. Where Did All These Companies' Enthusiasm Come From?

And where will it take the gaming industry?

ChinaJoy is now in its 15th year, and 2017 may have been the dullest edition in years.

The numbers still looked healthy. According to figures the organizers released after ChinaJoy closed on July 30, more than 900 game companies took part in the country's largest gaming expo this year, showing off more than 4,000 games. Both were records for ChinaJoy.

Visitors felt almost the opposite. Aside from game streamers, esports stars and showgirls, none of the attendees QDaily interviewed on site could immediately think of a game company that had made the strongest impression on them, or of a game most worth playing. Queuing, scanning QR codes and collecting souvenirs, all done mechanically, seemed to be the main business of many people's trip to CJ. "There's nothing fun here." That appeared to be the consensus.

For a gaming expo, new and interesting games are surely the best way to stir up visitors' interest and enthusiasm. But at this year's ChinaJoy, game launches and hands-on demos were not what the exhibitors led with. Whether domestic makers like Tencent and NetEase or console companies like Sony and Microsoft, the games they brought had all, to some degree, been shown before.

Exhibitors poured their energy and enthusiasm into esports instead. Big companies, small ones, livestreaming firms, hardware firms — with a few exceptions, most booths looked much the same. An open stage, five seats on each side, and on the big screen in the middle a match streaming live: either Overwatch, League of Legends or Honor of Kings.

Walk from Hall N in the north zone to Hall E in the east zone and you saw the scene again and again — commentators calling a live match through loudspeakers, with spectators sitting below in twos and threes, staring at the big screen.

"It's all esports this year," one of the organizers' staff on site said. Judging by what was on the floor, esports had become the biggest, perhaps the only, theme of ChinaJoy 2017.

Esports really is becoming a bigger market. The 2017 First-Half China Gaming Industry Report, released at ChinaJoy, put actual sales revenue in China's esports gaming market at 35.99 billion yuan for the first half of the year, up 43.2% year on year, with its share of the overall gaming market rising 4.2 percentage points.

Just before this year's ChinaJoy opened, Ding Dong, director of the Sports Information Center under the General Administration of Sport of China, said in an interview: "China is becoming the center of world esports. Not the only one yet, of course, but at least one of them. Nothing in esports today happens without China."

But growth alone does not explain everything on show at ChinaJoy. The anxiety of the big game companies is the most important force behind this wave of esports enthusiasm.

"Growth in China's gaming market has already peaked, mobile games included," a hedge fund analyst who follows the industry told QDaily at ChinaJoy. The growth mobile games were still posting, he said, came from Honor of Kings suddenly taking off in the first half of the year. "If the next hit doesn't appear, the mobile gaming market will shrink fast."

The way League of Legends has grown shows what is changing at game development companies.

"If a company has been around for ten years, kept growing, and only ever put out one game, that would be a bit crazy," Riot Games co-founder Brandon Beck told the gaming outlet Chuapp. "But for us, I'd say we've already released League of Legends 2 and League of Legends 3. League of Legends has been our focus ever since it launched. It's our top priority."

By 2016, Riot Games had grown to more than 1,000 employees, the great majority of them working on that one game. The other co-founder, Marc Merrill, has recalled that over the past few years Riot kept testing and adding features to League of Legends: a replay function, a new client, a sandbox mode, in-game tournaments.

In 2013, Riot started developing a card game set in the League of Legends world, then canceled it. The company has a few new projects under way, but it still insists it "always wants to dig up new ideas around League of Legends."

The gaming industry is leaning on proven product formulas more than ever. With no new products, a company that wants to keep growing can only look for new ways to make more money from the games it already has — and esports, in theory, is a good option.

"In 2016, the LPL (League of Legends Pro League) drew more than 5 billion viewers over the year, more than 840 million hours watched, and over 50 million page views a day. We have reached a certain scale, which makes us think we have a chance not just to lead esports, but to be compared with the Chinese Super League, even the NBA," said Ye Qiangsheng, head of Riot Games China, the developer of League of Legends, at the 2017 Global Esports Industry Summit held during ChinaJoy.

Ye was not the only one reaching for the NBA. Ding Dong had already argued that esports could eventually move closer to traditional sports leagues like the NBA. "The rules and the way it operates — including how players, referees and coaches are certified, ranked and trained — all have to develop in that direction. That's where things are going."

The big companies moved in long ago.

As early as 2010, Tencent declared its esports ambitions by setting up TGA (Tencent Games Arena). Today it already runs a range of competitions, including the TGA Grand Slam, the LPL (League of Legends Pro League), the KPL (King Pro League, for Honor of Kings) and the WGC (WeChat Elite Challenge).

This June, Tencent Esports — six months old at the time — announced a "five-year plan" covering four areas: upgrading tournaments, building leagues, training talent and expanding the industry. The company also plans to build more than ten pan-entertainment esports industrial parks around the country. Cheng Wu, vice president of Tencent Group, believes China is heading into a golden five years for esports: "Under this plan we hope to work with all our partners — with competitions as the base, leagues as the support, education as the foundation and industrial parks as the vehicle — to create a 100-billion-yuan esports industry."

Last November, Blizzard launched a league for Overwatch, its most popular new game, modeled on traditional sports leagues like the NBA, with teams built around cities. This July, Blizzard sold the first batch of league slots to seven companies in major cities worldwide; NetEase was the only Chinese company among them, taking the Shanghai team. NetEase CEO Ding Lei said: "We look forward to building a world-class team in Shanghai."

At this year's ChinaJoy, Giant Network launched its Giant Esports brand, with the casual competitive game Battle of Balls (《球球大作战》) as its lead esports title. Alibaba Games showed two MOBAs, War of Freedom 2 (《自由之战 2》) and Ledger of Blades (《刀剑兵器谱》), claiming they would let more people feel the appeal of esports. Earlier, Seasun released the shooter Counter-Terrorism Action (《反恐行动》). Perfect World also struck a partnership with Allied Esports.

Even consumer brands wanted to reach younger users by sponsoring esports. BMW's earlier sponsorship of a skin in Honor of Kings was held up as a model marketing case.

As with every concept that has burned hot in the gaming industry before, this heat is clearly mixed with irrational mania and the bubble it produces. The esports business model cannot yet be called mature, and today's esports leagues are a long way from a settled form like the NBA.

The NBA that Ding Dong invoked takes in US$8 billion a year, but it has decades of history behind it, while a game that lasts more than ten years is already doing well. Esports extends a product's life and widens its reach. At first glance it really does look like a good choice.

On the other hand, it has to live with an unstable business model. More than 40 million people worldwide watched the League of Legends finals, more than watched the NBA Finals in North America. But the annual revenue of Riot Games, the studio behind League of Legends, is less than a quarter of the NBA's, and most of it still comes from in-game purchases.

And even League of Legends is still working out how an esports league should be put together. How long a season should reasonably run, whether the format should be knockout or round robin, how to train players, how clubs can turn a profit, how venues can keep matches running smoothly — none of these questions has a good answer yet.

Esports poses a double challenge for game companies. For one, a new game needs a big enough audience before it can become an esports title. Heroes of the Storm did not have enough players, and its developer, Blizzard, got little return for the effort it put into making it an esport.

In South Korea, StarCraft once made the country's esports scene flourish. As the game faded, the Korea e-Sports Association (KeSPA) announced in October 2016 that the StarCraft league it had run for 14 years would shut down, forcing large numbers of players to retire or switch to other games.

In such an uncertain situation, how many of the companies flying the esports flag at this year's ChinaJoy will be back a year from now?

The answer may not be cheering. Over the past three years, companies that turned up at ChinaJoy behind one concept and then vanished have not been rare. In 2015, VR was hot, but the content never broke through, and VR began to fade from ChinaJoy. In 2016, game livestreaming made a huge noise there, but this year only Panda TV could still rent a giant booth. "A hall and a half of livestreaming is gone," one staffer on site said.

Follow that line of thought and there is reason to suspect that esports today is not very different from VR or livestreaming then. Each was the frenzy that followed capital pouring in fast and heavy after the gaming industry found a new concept. Perhaps, as competition sharpens, the industry's spending on esports and its enthusiasm for it will drift back to normal too.

Seen another way, though, the power of esports to shape the gaming industry should not be underestimated. In the past, traditional makers like Ubisoft and EA had to develop new games every year just to keep running. In future, more and more companies may put their effort into one game built for esports, and try to live off it for years afterward.

Games keep moving toward mass-market and mobile players. Like every other form of entertainment, the most mainstream games aim at everyone, which means that, next to the hardcore games of before, they tend to be simpler in design and easier to pick up. Their point is to soak up players' spare minutes, not to push them through an epic campaign that ends with the game shelved for good.

Where is the line between mobile games and traditional console or PC games? Can mobile design become refined enough to deliver something close to a console or PC experience? Are traditional hardcore players completely different from casual players who only play on phones? A mobile gaming market five or six years old cannot answer these questions.

All of this showed up at this year's ChinaJoy too. Most exhibitors were showing League of Legends and Honor of Kings matches, but plenty of players looked genuinely interested in the decent console and PC games on offer.

At 4 p.m. on July 27, as the first day of ChinaJoy wound down, Microsoft, in area E7, revealed the sequel to the AAA title Middle-earth: Shadow of Mordor. No showgirls, no deafening speakers — the development team simply came on stage and played a stretch of the game, and that alone stopped a crowd of passersby.

Next to the audiences at most booths, who scattered as soon as the show ended, this crowd was unusually focused. When the demo finished, even the players queuing at the Sony area across the way applauded. For a moment, ChinaJoy looked a little like it did when it was born: people applauding from the heart for a new game that looked good.