Attendees play online video games at the Tokyo Game Show 2017 at Makuhari Messe in Chiba, Japan. (Photographer: Akio Kon/Bloomberg)

Alibaba Endorses Esports for Olympics, But Not Violent Games

(Bloomberg) -- Alibaba Group Holding Ltd. is happy to help promote the inclusion of competitive video games as an Olympic sport, just as long as they aren’t violent or gory.

China’s biggest e-commerce company, which operates an esports business and is a sponsor of the Olympics Games through 2028, is pushing for soccer, car racing and other games to be endorsed as an official competitive sport, said Zhang Dazhong, chief executive officer of AliSports.

That move could bar some of the world’s biggest titles from the Olympics, such as League of Legends and PlayerUnknown’s Battlegrounds, which are both distributed by Alibaba’s competitor Tencent Holdings Ltd. in China. Esports is becoming a big business, drawing spectators to huge arenas where competitors battle each other for prizes and glory. The industry is projected to reach $5 billion in annual revenue by 2020 from ticket sales, advertising, broadcast rights and merchandising, according to researcher Activate.

“In our communication with the Olympics committee, we’ve come to have a better understanding of their values, which is to promote peace,” Zhang said in a telephone interview. “That’s why for the future development of esports, we will focus more on titles that are actually related to sports, instead of games that focus on violence and slaughter.”

Alibaba, which is investing 300 million yuan ($47 million) in esports in the year through March, is hosting the World Electronic Sports Games this week, where the member of the International Olympic Committee will also attend to observe. The e-commerce giant teamed up with the Olympic Council of Asia to add esports to the 2017 Ashgabat Asian Indoor and Martial Arts Games and the 2018 Jakarta Asian Games.

Game producers will need to be willing to share their intellectual property for free at the events, and the titles need to have a large fan base, according to Zhang. Because of the fast-changing nature of online games, it would be best to review what titles to include and adjust the rules on an annual basis, instead of every four years, he said.

“We think as a third party esports organizer we’re a better match for principles that the Olympics promotes, which is fairness,” Zhang said, adding that Alibaba will boost its investment in its esports unit this year, without giving a specific amount. “If you’re a games producer, you’re suspected of only pushing your games for your own benefit.”

©2018 Bloomberg L.P.