Caoitalizing on the future growth of the eSport industry - Tencent Ltd Company case
Ho, Nhi; Ho, Nhi (2021)
2021
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Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:amk-2021053112620
https://urn.fi/URN:NBN:fi:amk-2021053112620
Tiivistelmä
This thesis aims to analyse electronic sports or eSports - one of the world's fastest growing phenomenal in terms of public recognition and capital gain. An overview of eSports is provided in the first and second chapters with details regarding its historical development and formation. Several questions about the establishment of electronic sports, its association to traditional sports and gaming are addressed in this part.
From the third chapter onwards, the thesis concentrates on analysing eSports as a young industry. By going through eSports development, economics impacts, investments, and its ecosystem; evidences supporting eSports maturity as an industry are presented. At the end of chapter five, eSports status as a nascent industry is established, along with footing data that points towards an explosive multi billionaire industry in upcoming years.
In chapter sixth, a theoretical framework is presented. In this part, eSports is evaluated from economics perspective rather than financial figures and popularity. The definition of a nascent industry is provided, comes along with analytical measurement in terms of revenue, demand, investment diversification. Then, the compound annual growth (CAGR) is calculated, which the result supports the conclusion of eSports maturity given in the previous chapters. In the second part of this chapter, the Strategy Diamond framework written by Donald Hambrick and James Fredrickson is stated, outlying six elements: Arenas, Vehicles, Differentiation, Staging, and Economic Logic.
The last chapter deals with the case of Tencent Ltd – one of the leading companies in electronic sports. By applying the diamond strategy framework, this chapter analyses how Tencent Ltd has successfully capitalize the eSports industry. First, the company financial statements are presented. Then, calculation to predict Tencent Ltd annual growth is given. Second, its financial key highlights are also described to provide better understanding on its growth. After that, the diamond strategy is used as a unified model to evaluate steps taken by Tencent Ltd in each stage of developing competitive gaming and eSports.
The final chapter summarizes the main ideas throughout the thesis. The most profound evaluation in this thesis is the case of Tencent Ltd. With the hope to encourage others to follow the footsteps of Tencent, the last chapter serves as an example of how firms can take advantage of business models and strategy frameworks as the five-diamond strategy to capitalize a nascent industry with fast growing pace like eSports.
From the third chapter onwards, the thesis concentrates on analysing eSports as a young industry. By going through eSports development, economics impacts, investments, and its ecosystem; evidences supporting eSports maturity as an industry are presented. At the end of chapter five, eSports status as a nascent industry is established, along with footing data that points towards an explosive multi billionaire industry in upcoming years.
In chapter sixth, a theoretical framework is presented. In this part, eSports is evaluated from economics perspective rather than financial figures and popularity. The definition of a nascent industry is provided, comes along with analytical measurement in terms of revenue, demand, investment diversification. Then, the compound annual growth (CAGR) is calculated, which the result supports the conclusion of eSports maturity given in the previous chapters. In the second part of this chapter, the Strategy Diamond framework written by Donald Hambrick and James Fredrickson is stated, outlying six elements: Arenas, Vehicles, Differentiation, Staging, and Economic Logic.
The last chapter deals with the case of Tencent Ltd – one of the leading companies in electronic sports. By applying the diamond strategy framework, this chapter analyses how Tencent Ltd has successfully capitalize the eSports industry. First, the company financial statements are presented. Then, calculation to predict Tencent Ltd annual growth is given. Second, its financial key highlights are also described to provide better understanding on its growth. After that, the diamond strategy is used as a unified model to evaluate steps taken by Tencent Ltd in each stage of developing competitive gaming and eSports.
The final chapter summarizes the main ideas throughout the thesis. The most profound evaluation in this thesis is the case of Tencent Ltd. With the hope to encourage others to follow the footsteps of Tencent, the last chapter serves as an example of how firms can take advantage of business models and strategy frameworks as the five-diamond strategy to capitalize a nascent industry with fast growing pace like eSports.