Chinese game live-streaming platform Huya has announced it will reduce its esports licensing fees for broadcasting LoL matches.
Image Credit: @lplenglish
Huya will reduce the fees to 230 million RMB
According to a report by the Esports Advocate, Huya has entered a second supplemental agreements to its Agreement for broadcasting League of Legends matches with Tengjing Sports & Culture Development (Shanghai) Co., Ltd, also known as TJ Sports, the tournament organizer behind the League of Legends Professional League (LPL).
TJ Sports is a joint venture between Tencent Holdings Limited and Riot Games, with the former holding 66% ownership in Huya.
The Board of Directors and the audit committee of Huya have approved the new agreement and terms, which will see the aggregate license fee for 2024 and 2025 be reduced to ¥230M RMB ($32.8M), marking a decrease from the previously agreed ¥300M ($42.8M). The original License deal had set exclusive live broadcasting rights in mainland China for the LPL from 2021 to 2022 for Huya.
The 2023 amendment, however, saw broadcasting rights become non-exclusive for the following years as well as the stripping of its sub-licensing rights. Despite the inclusion of the League of Legends World Championship for 2023 through 2025, the fee was still decreased to ¥450M ($64.2M).
Now, the fee is going to be reduced even more, as Huya and Tencent’s affiliates are looking to adjust to their current financial position and market condition. According to the annual financial report, the company faced a decline in live-streaming revenues from Â¥8.2B ($1.17B) in 2022 to Â¥6.5B ($930M) in 2023, marking a worrying 21.3% decrease. This has mainly been due to reduced user spending on live-streaming services and stronger competition.
With this major financial reduction, the company is looking to optimize costs amid declining revenues while adopting a stricter screening process for content procurement and production. The announcement during a few days before LPL teams begin their World Championship action in Europe, starting from the Swiss stage on October 3.
