Funspark CEO Zen Zhang on Building China’s International Esports Brand – The Esports Observer

In China’s long history in esports, the lack of top-level performance by Chinese teams in Counter-Strike 1.6 (CS 1.6) and Counter-Strike Global Offensive (CS:GO) is a source of distress for many Chinese players and people who care about the professional title in the country. Unlike other esports teams in Dota 2, League of Legends, and Warcraft III, which have secured a number of world championships over the years, China’s CS teams have only won  a CS 1.6 international championship at the World Esports Games (WEG) in 2005. 

“The lack of communication between Chinese professional players and world-leading Western CS: GO players are the main reason that our [Chinese teams’] performance can not reach top CS:GO level,” Zen Zhang, founder, and CEO of Chinese tournament organizer Funspark told The Esports Observer. “It’s also one of the reasons that we decided to host an international CS:GO tournament – Funspark ULTI.”

Funspark and Chinese esports platform 5E Play co-hosted the Funspark ULTI Finals online last week. Due to the pandemic, the competition was divided into two finals – European Finals and the Chinese Finals. The European Finals featured eight European teams, including BIG, Complexity, Evil Geniuses, Dignitas, and Virtus.Pro, with  $250K USD in prize money up for grabs. Meanwhile, two Chinese teams, Tyloo and Wings Up, will compete in the Chinese Finals for $50K.

Apart from CS:GO, Funspark has also expanded to fighting game competitions with a new tournament brand called “Spark Championships.” Zhang detailed building out those competitions with TEO.

Zhang started his career in esports at Beijing-based esports organization SECE as a professional CS 1.6 player back in 2003. Unlike other professional players who enjoyed playing games first, Zhang said he enjoyed the competitiveness of esports. 

“I felt bored when I played CS alone, but I enjoyed the communication with my teammates and won competitions at internet cafes, ” Zhang said, to explain why he joined the esports industry.

How to Prevent ‘Bubbles’ in Esports Industry

Zhang now has almost 18 years in China’s esports industry. As the CEO of a tournament organizer, he emphasized that the esports industry needs to be looked at from a content perspective.

“The core value of the esports industry is to create more content for entertainment. Players, competitions, live streaming, short-film videos, and even esports key opinion leaders (Kol), they are all esports-related content.” Zhang said, “The development of the internet boosts the esports industry, but the internet industry also adds a bubble in esports.”

In China, most esports titles are fully owned or operated by large game publishers, such as Tencent, NetEase, and Perfect World. However, Zhang says that China’s administration departments should also take responsibility for guiding the esports industry to prevent the bubble from bursting.

“China has not had an actual administration department to manage esports from an industrial perspective, whether it’s a part of sports or culture,” Zhang said. “The local governments that support esports are looking for taxes and creating more jobs for firms, while the industrial department pays more attention to sustainability.”

Zhang also pointed out that the integration of esports talent, and openness of China mainstream media is also vital to maintaining the momentum for esports. “We need more talented outsiders coming to the industry, and more transparent content created by the media. The recognition of esports from society needs to improve,” Zhang said.

“The contest between China and other countries is one of the materials for esports contents,” Zhang said. “Without internationalization, China esports will lack customer loyalty [national honor] and culture export value.”

In fact, the sports rivalry between nations has been widely applied in traditional sports competitions for hundreds of years, including the Olympic Games and the FIFA World Cup. In Western esports, we are familiar with a team that has players with mixed nationalities, and most of the time we identify a team as a European or a North American esports organization. Asian esports are more nationally driven, as we are used to saying a Chinese team or a South Korean team. 

In that spirit, FunSpark hosted the multi-esports competition National Electronic Sports Tournament (NEST), which is also supported by the General Administration of Sport of China (SSAC). “NEST is positioned like China’s National Games or national esports trials,” Zhang said.

In fact, Funspark’s role as host of  NEST can be traced back to 2004, FunSpark grew out of Chinese tournament organizer China Interactive Sports (CIS), and NEST also came out of China E-Sport Games (CEG), which was also supported by SSAC. However, for some undisclosed reasons, SSAC shut down the CEG in 2008, and Funspark restarted a multi-title tournament brand called NEST in 2013.

“For a long time, SSAC has been really supportive for NEST and esports, and there is actually no hard communication with Chinese government bodies,” Zhang said. “Sometimes, they just need some time to observe and replan because the industry moves rapidly.”

With SSAC’s support, Funspark received authorization from Tencent and Riot Games to host League of Legends in NEST. It should be noted that Tencent and Riot Games rarely give League of Legends hosting rights to third-party tournament organizers since 2017, when Riot Games took back authorization from ESL’s Intel Extreme Masters (IEM).

“In League of Legends especially, NEST is the rookie battleground for the League of Legends ecosystem,” Zhang said. “Chinese esports organization Royal Never Give-Up (RNG) was established through acquiring the full rosters of Chinese League of Legends team King when the team won 2014 NEST. Chinese League of Legends icon player Yu “Jackeylove” Wenbo’s first appearance was also at 2017 NEST.” 

‘China has 10M Console Users, But No Competitions to Serve Them’

When talking about the new fighting game esports competition, Spark Championships, Zhang has a hard time suppressing his excitement. Earlier this month, Funspark announced that it will partner with China’s biggest console community G-cores to co-host the Spark Championship Season 5 in Beijing from May 1-16 with a live audience, featuring console esports titles Street Fighter V and Super Smash Bros, as well as a $4.6K total prize pool.

“We did some research in China and the country actually has 10 million console users,” Zhang said. “They have strong consumption ability and brand awareness, but no one hosts esports competitions to serve them, either playing or watching.” 

In the big picture, China has a 10-year gap in console games. In June 2000, China’s National Ministry of Culture banned the manufacture and sales of gaming consoles in the country. The instruction also forced the Sony PlayStation China office to close in 2006, a ruling that was eventually lifted in 2014

“Though Chinese players are more used to playing mobile games instead of playing hardcore console games, there is still a market potential and space for console games users,” Zhang said. “We want Chinese players to have an international platform to communicate with overseas players, that’s why we host Spark Championships.”

Why Funspark Chose CS: GO as the First Esports Title for Funspark ULTI

“On the one hand, I and my team know the Chinese CS:GO scene well. On the other hand, if we don’t do it, no one will, because you may not receive profit in the short term, considering how frustrating the current ecosystem is,” Zhang said.

In China, not every game publisher invests huge manpower and material resources to build  esports ecosystems like Tencent and Riot Games. For CS:GO and Dota 2, game publisher Valve and Perfect World show little interest in building a solid, sustainable esports ecosystem in China. 

CS:GO and Dota 2 ecosystem is more dependent on third-party tournament organizers,” Zhang said. In addition, Zhang pointed out that from a sponsorship perspective, Chinese brands are more interested in sponsoring mobile esports tournaments, not hardcore PC esports.

“We are currently reaching out to endemic brands, such as Nvidia and hardware brand Vaxxe to create some co-branded products to make up for the missing sponsorship value of Funspark ULTI,” Zhang said. “To be honest, I can not guarantee our cost and income of hosting Funspark ULTI will break even, but we want more Western players and teams to know this brand and they will have a better experience for competing for the event. We are expecting the pandemic will end soon so that we can host CS:GO live events.” 

Zhang also said that match-fixing is a serious problem in China’s CS:GO ecosystem. 

“We [Funspark] used to host China CS:GO Super League (CSL) in China, and I decided to shut it down in 2018,” Zhang said. “The reason behind this was we can not control match-fixing in our league. The motivation of match-fixing is because players or teams do not get paid on a reasonable payment, and they want to make additional income for living. Ultimately, this is an industrial problem. How to guarantee players’ benefits in the ecosystem, salary, prize money, and even commercial value. If a player knows the earning from match-fixing is much lower than his/her paid or commercial value, he/she won’t do it.”

As for the future,  Zhang said that CS:GO is the first esports title of Funspark ULTI but it won’t be the last. Funspark also has interests in CrossFire, Valorant, and Call of Duty. In March, the company also signed a partnership deal with Berlin-based data platform GRID Esports to supply match integrity services for the upcoming Funspark ULTI 2021 circuit. For 2021, Zhang said that the company is expecting to expand its business in Southeast Asia and Japan.

“You have to have the sense of mission and product differentiation when you are an esports tournament organizer, otherwise it’s just a meaningless commercial activity,” Zhang said.

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