This story first appeared in China Report, MIT Technology Review’s newsletter about technology in China. Sign up to receive it in your inbox every Tuesday.

It was probably the highest-stakes mobile game match that’s ever been played. On the evening of September 26, 10 men from China and Malaysia sat on a stage in Hangzhou, China, each staring intensely into a phone. More than 4,000 people were in the arena’s audience, cheering on the group of players who were barely adults, while potentially millions watched online or on TV. In 13 minutes, the Chinese team won, clinching a gold medal and earning the highest sports recognition in Asia.

This was either a teenage gamer’s dream or their parents’ worst nightmare, depending on who you ask. But it’s real: For the first time in history, e-sports is an official, medal-earning event at the Asian Games, the continent’s regional version of the Olympics, which opened last week. Over 20 countries competed in seven e-sports games. 

What’s wild to me is that these events are attracting more interest than the Asian Games’ traditional sports. Of all the competitions taking place, e-sports is the only one in which arena tickets were sold on a lottery basis because of skyrocketing demand. There were over 5 million lottery entrants for all the e-sports events; each had a 0.5% chance of getting a ticket.

If you do not spend much time in Asia, this might be something of a surprise. 

“What’s clear is that Asia is the leading region for e-sports right now,” says Daniel Ahmad, the director of research and insights at Niko Partners, a gaming analytics company. “Our previous studies have found that gamers in Asia are more motivated by competition, alongside completion, challenge, and community, when compared to the West.” 

China is really the leader here. In fact, it’s the largest e-sports market in the world, accounting for 34% of global industry revenue in that category, according to market research by Niko Partners; Asia combined takes 53%. 

Within China, e-sports are run like any popular sport and have been for a long time: there are regional clubs, each with its home stadium; tournaments featuring different tiers of talent make it possible for the industry to evaluate the players (and also for the players to make a living); and in recent years, star players have even been marketed like celebrities, attracting cultish fan groups. 

And as the industry’s popularity soars, the fan base is growing beyond the groups you probably picture when you think e-sports fan. According to a 2022 survey done by CADPA, a Chinese industry association with government backing, e-sports have nearly as many fans in the 35-to-44 age group as among those under 24. Women and people from the country’s smallest towns also make up 44% and 36% of the fan base, respectively.

How did this happen? 

Well, part of the popularity has to do with a few major Chinese tech companies. Video games have always been the money-making machine for Tencent, for example, contributing nearly one-third of its revenues. Of the seven e-sports events in the Asian Games, four are games developed or published by Tencent.

The other important factor has been the rise of mobile gaming in China, which has made e-sports more accessible to people who don’t have computers or consoles. Over 50% of all e-sports tournaments in China are focused on mobile games now, says Ahmad. Companies like Tencent are now being recruited by brands like Disney and Nintendo to make their mobile games.

This is all happening despite the Chinese government’s deep ambivalence toward e-sports—it praises them as a source of national pride even as it despises them as a factor in internet addiction. 

On the one hand, the government has been boosting the development of e-sports by subsidizing companies, building competition venues, and even greenlighting e-sports majors in higher education. Several cities, including Shanghai and Shenzhen, are vying to become the capital of e-sports—not just for China, but for the world. 

But I’ve also covered in this newsletter how the Chinese government has taken a particularly strong stance against underage gaming. People under 18 are limited to three hours of gaming every week. “While the regulations have had an impact on the amount of time played, that hasn’t stopped youth engaging with e-sports on live streaming platforms,” Ahmad says. (Bloomberg reports that the Chinese government even limited livestreaming of the Asian Games’ e-sports events, partly because of concerns about video games and internet addiction.)

The restrictions have probably had a larger impact on how e-sport teams find talent and train players. Like any athletes, professional e-sport players usually start their training in their early teens, so the government faces an inevitable dilemma between keeping minors from gaming and fielding competitive teams on the international stage. (The average age of Chinese participants in Asian Games e-sports is 20.)

The Chinese government’s confusing position is probably the biggest obstacle to the industry’s progress. E-sports could be a major cultural export for China. The intense popularity among young people means there is real opportunity for reach and revenue, and the International Olympic Committee just launched an E-sports Commission last month (though it will still take a long time before the Olympics formally accepts e-sports). But for now, it’s hard to see most Chinese parents happily taking their children out of school and putting them into e-sports training camps. 

Have you watched or followed any e-sports tournaments? Do you think of these as “sports”? Let me know your thoughts at zeyi@technologyreview.com.

Catch up with China

1. Ukrainian soldiers turned Chinese-made hobbyist drones into combat weapons, but now China has started restricting the export of drones, so they will have to source them from elsewhere. (New York Times $)

2. Morocco is becoming a popular spot for new battery plants, including those built by Chinese companies that still want to serve the American and European markets. (Financial Times $)

3. In a new report, the US State Department accuses China of investing “unprecedented resources” into disinformation and censorship technologies. China, meanwhile, calls the report “in itself disinformation.” (CNN)

4. TikTok employees in the US say executives who came from China have brought along influences from the parent company, ByteDance, as well as a toxic office culture. (Wall Street Journal $)

5. CNKI, China’s largest academic publishing database, was fined 50 million RMB ($6.8 million) for illegally collecting users’ personal information, following a separate, bigger fine last year for monopolistic practices. (Sixth Tone)

6. Women’s rights have been some of the hottest discussion topics on Chinese social media in recent years—but also the most censored. (Rest of World)

• Chizuko Ueno, a feminist scholar from Japan, leaped to fame in China for her resistance to marriage and childbearing. She avoided censorship because her writing doesn’t directly deal with China. (Associated Press)

7. Indonesia banned e-commerce on social media apps. It’s bad news for TikTok, which was given a one-week deadline to spin off its e-commerce functions. (CNBC)

Lost in translation

A police investigation in southwestern China uncovered a massive malware network that has compromised over 14 million mobile phones of elderly users. In China, a special type of mobile phone is popular among older demographics, with enlarged text, simplified functions, and more affordable price tags. According to the Chinese publication The Cover, millions of these phones come with malware that automatically subscribes them to paid services like “mobile news,” “safe weather,” and “system reminders”—with charges as low as $1 a month that still add up to substantial costs for users. 

The police in Sichuan found four criminal groups that worked with mobile-phone manufacturers to implant malware directly into the phones’ motherboards. Once the phones are sold, the criminals control the devices remotely to reply “Y” in a message to agree to these premium services, and then automatically delete the messages. Because elderly users are not always tech-savvy, it can be harder for them to notice or understand why the phone bill keeps going up. Altogether, the criminal gangs have made over $15 million in illicit profit, said the police.

One more thing

When South Korea won the League of Legends final at the Asian Games last week, the winning team didn’t just get gold medals—they also received exemption from Korea’s mandatory 18-month-long military service. This kind of pass has been traditionally given to athletes who won medals at the Olympics or golds at the Asian Games—recognition for their contribution to promoting Korea’s image. It’s the first time that e-sports players have been included. There’s one group of people, however, who take issue with the news—fans of BTS, who believe their idols have done more to export Korean culture but still had to serve during the peak of their international fame.

Correction: An earlier version of this story misspelled the name of the director of research and insights at Niko Partners. He is Daniel Ahmad, not Ahmed.