Mar
05
American Sports’ Battle for China


This video was made possible by Brilliant. Learn complex topics simply for 20% off by
being one of the first 200 to sign up at brilliant.org/Wendover. Twenty years ago, the western world didn’t
really think of China as a market. The country was an asset for the west’s
own market, sure, but only for the reason that it was a large, poor country that could
act as a source of low-cost labor. Today, though, with an economy ten times larger
that that of just twenty years ago, the western world, or at least the properly informed western
world, no longer thinks of Chi na as that poor, low-cost labor asset, but rather as
a significant, attractive market itself. Whereas in the past China made for the west,
today China is the very market that the western world focuses their attention on. With a rapidly growing middle and upper class,
businesses around the world have flooded in to cater to China’s newly wealthy in the
same way that they have long served the rich in the wealthy western world. Industries ranging from hospitality, to tourism,
to e-commerce, to beauty, and more are all thriving there with both home-grown and foreign-born
players establishing their spots in the Chinese market, but one enormous industry that is
still emerging and evolving in the Middle Kingdom is that of sports. Sports is a monstrous global industry, but
nowhere is that industry more enormous than in the US. The NFL, MLB, NBA, and NHL represent the first,
second, fourth, and six most valuable sports leagues in the world and collectively bring
in more than $30 billion in annual revenue. However, American sports are not purely an
American industry. Between merchandizing, league partnerships,
TV and streaming rights, and other revenue streams, American sports leagues actually
earn a considerable amount of money outside of America. China is a market worth targeting for any
business, but it has a particular appeal for sports leagues. Beyond its status as a large and relatively
recently wealthy nation, China has a government willing and interested in investing in foreign
sports—the kind of foreign sports that would earn them prestige in international competitions. Each of the four major American sports leagues
are the dominant leagues in the world for their respective sports, so any interest in
each sport will lead to interest in the league. Consequentially, each league has its own strategy
to grow Chinese interest both in their sport and their league. Baseball is incredibly popular in nearby Taiwan,
South Korea, and Japan, and so there was reason to believe that the sport could too become
popular in China. Despite this, though, Major League Baseball
has demonstrated the least interest in the market and the market has demonstrated the
least interest in the MLB. The league’s most tangible effort to attract
Chinese audiences took place back in 2008 when two pre-season games between the Padres
and Dodgers were played in Beijing. Since then, the history of baseball in China
has been fraught with difficulties with their national league, which operated in cooperation
with the American MLB, suspending operations in 2012, restarting in 2014, suspending operations
again in 2016, then starting up again in 2019 with just four teams. The MLB has also long-operated three, “development
centers,” where top Chinese baseball players are trained, although, none of the players
from these centers have ever actually seen action in the MLB itself. One can find press release upon press release
about different renewed efforts by the MLB to grow the sport in China, however, all signs
indicate that these have not resulted in much. Evidence of this can be seen on the league’s
official Weibo account—one of the top social networks in China—which has only 650,000
followers. The story is not markedly different with the
NHL, but the history of its efforts is shorter. It put on exhibition matches between the Kings
and Canucks in Shanghai and Beijing in 2017, then between the Bruins and Flames in Beijing
and Shenzhen in 2018. These games were generally well received and
were attended by healthy-sized audiences, but there was a conspicuous lack of follow-up,
with no 2019 games in China, reportedly due to issues with booking arenas. Since then, though, they’ve doubled-down,
sending Stanley Cup Champion Alex Ovechkin to the country in summer 2019 to promote the
sport, opening an office in Beijing, and hiring a China marketing head. Unfortunately for them, though, the little
attention China pays to Hockey is not primarily directed to the NHL. The second most lucrative Hockey league in
the world, the Kontinental Hockey League, added a Chinese team in 2016—the HC Kunlun
Red Star. This team is no phenomenon yet, with the lowest
average game attendance in the league, but it does mean that a Chinese hockey fan would
much more likely pay attention to the KHL over the NHL. Still, though, the NHL seems to get somewhat
more respectable Chinese engagement—demonstrated by their just over 1 million fans on Weibo. American football, though, is where it starts
to get interesting. The NFL has generated a real fanbase among
Chinese—not a large one, but it certainly exists. This is despite the fact that they are the
only of the four leagues that has not played a game in China. There is talk of putting one on in the country
at the start of the 2020 season, although, there has been talk before without result. The real potential for the NFL, though, comes
not through in-country games, but rather, through digital distribution. Each week, Tencent’s streaming platforms
broadcast a number of games, which each have an average viewership of more than two million
people. That’s despite the awkward broadcast times
in the mid-morning, given the time difference. How much the NFL was paid for these broadcast
rights is not publicly known, but with those kind of numbers, it’s certainly not nothing. Beyond the league as a whole’s efforts,
the New England patriots have put a particular level of effort into attracting Chinese fans. A huge benefit for them is that their star,
Tom Brady, has been learning and speaks a rudimentary level of Mandarin. He hosted a Chinese-language show for the
team’s digital channels which attracted sizable attention—over 15 million total
views. Meanwhile, playing the sport itself is increasingly
popular in China. Having one’s children learn the American
sport has emerged as a status symbol, and 120,000 young Chinese have gone to private
training camps for American football. Still, though, the NFL has a long way to go
to make China a sizable portion of its business. On Weibo, for example, it has only attracted
slightly more fans than the NHL, at 1.3 million. The final of these four leagues, though, has
turned China into a sizable and now crucial bit of its business. Basketball has been played casually in China
since the late 1800s when American missionaries first introduced the sport. As China liberalized in the latter half of
the 20th century, the NBA capitalized on this and then-commissioner David Stern led an effort
to get their games televised in China. This attracted a moderate fanbase, but the
true, pivotal moment happened in 2002. In that year, a young player from the Shanghai
Sharks entered the NBA draft and was picked first overall—Yao Ming. He quickly became a sensation and reached
the NBA All-Star team eight times, but as much as he was a sensation in the US, he was
just as much or more back home in China. The number of Chinese NBA fans grew exponentially
with every game he played, but eventually, after a series of injury-plagued seasons,
Ming retired in 2011. At the time, anyone would have assumed that
this would have been the end of the NBA’s rise in China, but as it turned out, this
was not the case. While at first Chinese fans may have tuned
in to watch Yao Ming, eventually they just tuned in to watch the NBA. In the decade following Ming’s retirement,
China grew into an enormous, crucial part of the NBA’s business, representing more
than $500 million a year in revenue. However, in October 2019, this was all threatened
by one tweet containing one image. It read, “Fight for Freedom, Stand with
Hong Kong.” This was, of course, a reference in support
of the widespread protests in Hong Kong, protests commonly characterized as anti-Beijing, but
what’s more important is who this tweet was by—Daryl Morey, the general manager
of the Houston Rockets. All of a sudden, deals fell apart, relationships
were severed, game broadcasts were cancelled—the NBA’s China market was under threat due
to a perception that the league was anti-China. Unsurprisingly, for business reasons, the
NBA quickly issued what was essentially an apology for this tweet. Of course, following that, the NBA both faced
criticism from China, for the original tweet, and from the US, for apologizing for that
tweet. Eventually, the scandal largely blew over
and relationships started to inch back to normal, but this was all indicative of a bigger
issue with American sports’ expansion into China. What these leagues are doing is selling one
product to two very different markets. Worldwide, the entertainment industry, of
which sports is a part of, has become increasingly homogenized with more and more people watching
the same TV shows, listening to the same music, and going to the same movies no matter which
country or culture they come from. China, meanwhile, is different. Chinese people largely watch different TV
shows, listen to different music, and go to different movies than the rest of us. A lot of this is because of government censorship
and import policy. For example, there’s a quota allowing only
a small number of foreign films into Chinese cinemas each year. Sports, though, can’t be treated like the
rest of entertainment. The sports entertainment experience in the
21st century stretches far beyond just the viewing of actual games. In fact, watching the games in their entirety
is hardly even a requirement anymore. Sports is an all-encompassing, unscripted,
uncensored entertainment experience, and this is the problem for China. It can’t just edit out an unflattering aspect
of sports in the same way it can with foreign films. Sports and politics in the US are intrinsically
intertwined. Many athletes naturally take their place as
political activists given their influence, but this is very different from in China. In China, sports is a game where athletes
go and play, someone wins, and then everyone goes home. That’s because, in China, entertainment
and politics stay far, far away from each other, or perhaps more accurately, entertainment
and opposition politics stay far, far away from each other. American sports will continue their march
towards increased relevancy in China as it, as a country, has an undersaturated spectator
sports market. Meanwhile, though, if these leagues become
a true phenomenon in China, they’ll have to make more tough calls as to whether they
want to be a sport league for the US, or for the world. In my opinion, the behind-the-scenes of sports
is fascinating. If you agree, but feel you’ve gotten enough
of the business side for now, you can learn a little more about the physics side. You can learn how climbers figure our how
elastic their rope should be—elastic enough to not give them whiplash when they fall,
but not elastic enough to let them hit the ground; you can learn how energy transforms
when a skier descends a slope; you can learn how archers account for gravity in their aim;
and you can learn all of this on Brilliant. These are just some of the interesting, engaging
things that you learn about while you’re actually learning classical mechanics on Brilliant—something
decisively less engaging than climbing, skiing, or archery. This teaching and learning style is what makes
Brilliant so effective for the kind of things that you might want to learn, but previously
were too daunted to. If your New Year’s resolution was to learn
more, to improve yourself, or to challenge yourself, Brilliant is the place to start. They help you achieve your goals in STEM and,
to make it easier, the first 200 people that go to brilliant.org/Wendover will get 20%
off an annual premium subscription.