Sports
Do Sports Still Need China?
Global outrage, broken contracts and shifting politics could change the calculus for leagues and teams that once raced to do business in China.The WTA Tour hosted nine events in China in 2019. It’s unclear when, or if, it will return there.Credit…Lintao Zhang/Getty ImagesPublished Nov. 24, 2021Updated Dec. 1, 2021To hear more audio stories from publications…
Global outrage, broken contracts and shifting politics could change the calculus for leagues and teams that once raced to do business in China.
To hear more audio stories from publications like The New York Times, download Audm for iPhone or Android.
The rewards for international sports leagues and organizations are plain: lucrative broadcast deals, bountiful sponsorship opportunities, millions of new consumers.
The risks are obvious, too: the compromising of values, the public relations nightmares, the general atmosphere of opacity.
For years, they have surveyed the Chinese market, measured these factors and come up with the same basic math: that the benefits of doing business there outweighed the possible downsides. The N.B.A. might blunder into a humbling political crisis based on a single tweet, and rich contracts might vanish into thin air overnight, but China, the thinking went, was a potential gold mine. And for that reason leagues, teams, governing bodies and athletes contorted themselves for any chance to tap into it.
But recent events may have changed that thinking for good, and raised a new question: Is doing business in China still worth it?
The sports world received a hint last week of a changing dynamic when the WTA — one of many organizations that have worked aggressively over the last decade to establish a foothold in the Chinese market — threatened to stop doing business there altogether if the government failed to confirm the safety of Peng Shuai. Peng, a top women’s tennis player once hailed by state media as “our Chinese princess,” disappeared from public life recently after accusing a prominent former government official of sexual assault.
The WTA’s threat was remarkable not only for its reasoning, but for its rarity.
Image
But as China’s top leader, Xi Jinping, governs through an increasingly authoritarian approach, and as its record on human rights has made the country, and those who do business there, a growing target for a chorus of critics and activists, sports leagues and organizations may soon be forced to re-evaluate their longstanding assumptions.
That sort of direct confrontation is already taking place elsewhere: Lawmakers in the European Union recently called for stronger ties with Taiwan, an island China claims as its territory, only months after European officials blocked a landmark commercial agreement over human rights concerns and labeled China a “totalitarian threat.”
For most sports organizations, the WTA’s position remains an outlier. Sports organizations with multimillion-dollar partnerships in China — whether the N.B.A., England’s Premier League, Formula 1 auto racing or the International Olympic Committee — have mostly brushed aside concerns.
Some partners have acquiesced at times to China’s various demands. A few have issued humbling apologies. The I.O.C., in perhaps the most notable example, has seemed to go out of its way to avoid angering China, even as Peng, a three-time Olympian, went missing.
But an evolving public opinion may get harder for sports organizations to ignore. A report this year from the Pew Research Center, for instance, found that 67 percent of Americans had negative feelings toward China, up from 46 percent in 2018. Similar shifts have occurred in other Western democracies.
Mark Dreyer, a sports analyst for China Sports Insider, based in Beijing, said the WTA’s standoff with China represented an escalation in the “them or us” mentality that appeared to be forming between China and its Western rivals.
The threat from the WTA, then, could serve as a sign of showdowns to come, in which case, Dreyer said, China could lose out.
“Frankly, China is a big market, but the rest of the world is still bigger,” he said. “And if people have to choose, they’re not going to choose China.”
To some experts, then, the WTA’s extraordinary decision to confront China head-on might actually signal a turning point rather than an aberration.
“The calculation is one part political, one part moral, one part economic,” said Simon Chadwick, a professor of international sports business at Emlyon Business School in Lyon, France. He said that the WTA’s dispute with China reflected the “red line” growing between the country and many of its Western counterparts, with the sides seeming more entrenched in diverging sociopolitical ideologies.
Image
“I think we are rapidly heading toward the kind of terrain where organizations, businesses, and sponsors will be forced to choose one side or another,” Chadwick added.
The WTA’s own about-face was stark. Only three years ago, the organization was heralding a deal that made Shenzhen, China, the new home of its tour finals for a decade starting in 2019, accepting promises of a new stadium and a whopping $14 million annual prize pool. In 2019, just before the pandemic, the WTA held nine tournaments in China.
Fast forward to last week, when Steve Simon, the WTA’s chief executive, said in an interview with The New York Times that if China did not agree to an independent inquiry of Peng’s claims, that the tour would be willing to cease operations in the country.
“There are too many decisions being made today that aren’t based on what is simply right and wrong,” Simon said. “And this is the right thing to do, 100 percent.”
The language raised eyebrows around the sports world.
“They are not the first ones to have had a run-in with China,” Zhe Ji, the director of Red Lantern, a sports marketing company that does work in China, said about the WTA. “But I haven’t seen anybody else come out with as strong a wording as that.”
The run-ins have proliferated in only the last few years.
The N.B.A., for instance, was seen as a pioneer when it played its first games in China in 2004, including a game featuring Yao Ming, the Chinese star for the Houston Rockets. The ensuing years brought prosperity for the league there, and relative peace. It was praised for its patient, culturally sensitive approach to building there. Then, in 2019, Daryl Morey, the general manager of the Rockets at the time, tweeted in support of pro-democracy protests taking place in Hong Kong, and in the blink of an eye a relationship that had developed over several years imploded.
Merchandise for the Rockets — China’s favorite team in China’s favorite sports league — was removed from stores, and the team’s games were no longer broadcast on television. Fans took to Chinese social media to attack the league. Then, when the N.B.A. issued what was widely taken as an apology, it sparked an almost equally robust wave of criticism back home.
Real Life. Real News. Real Voices
Help us tell more of the stories that matter
Become a founding member“The NBA should have anticipated the challenges of doing business in a country run by a repressive single party government, including by being prepared to stand in strong defense of the freedom of expression of its employees, players, and affiliates across the globe,” read a letter sent to the league by a bipartisan group of United States lawmakers.
Image
The letter’s signees — a cross-party group that included Representative Alexandria Ocasio-Cortez of New York, a Democrat, and Senator Ted Cruz of Texas, a Republican — accused the N.B.A. of compromising American values and effectively supporting Chinese propaganda.
“The N.B.A. has adhered to its values by supporting Daryl Morey’s and others’ rights to express their views despite the significant impact to our business,” Mike Bass, an N.B.A. spokesman, said on Wednesday.
Understand the Disappearance of Peng Shuai
Card 1 of 5
Where is Peng Shuai? The Chinese tennis star disappeared from public view for weeks after she accused a top Chinese leader of sexual assault. Recent videos that appear to show Ms. Peng have done little to resolve concerns for her safety.
