Esports: The New King of Live Events

Esports is revolutionizing the sports industry and college athletic departments through sold-out events held across the country.

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Virtus.pro wanted revenge after a brutal esports bout. The Russian-based team was bested by its Dutch rival Astralis during a thrilling last-minute comeback in January’s Major Grand Final, which attracted 4.6 million viewers. Now the two five-member teams were facing off again in what was billed “Clash for Cash: The Rematch.” Up for grabs was $250,000 in prize money, national recognition and the chance to claim dominance in Counter-Strike: Global Offensive, a first-person shooter video game in which players use virtual bombs and high-powered guns to mow down their opponents.

The June rematch was broadcast on TBS and video streaming platforms Twitch, YouTube and ELEAGUE Live Game Command. It was a bloody, violent best-of-three showdown. When the dust cleared, Astralis once again claimed victory, much to the delight of the cheering, sold-out crowd.

Long known for traditional sports like baseball, basketball and golf, Turner Broadcasting, along with partner IMG, recently launched ELEAGUE, an esports tournament brand with live event coverage. It’s yet another indicator of how video gaming, or esports, is rapidly becoming a mainstream phenomenon, with high-profile sponsorship deals, sold-out arenas, screaming fans and worldwide superstars—some barely out of high school—competing for millions of dollars in cash prizes.

It turns out all those kids who filled arcades back in the 1980s and dreamed of playing video games for a living were actually onto something.

Endless Possibilities

Since Turner Broadcasting and IMG launched ELEAGUE in 2015, the league has cut deals with several game publishers, including Valve (“Counter-Strike: Global Offensive”) and Capcom (“Street Fighter”), in order to host nationally televised tournaments featuring the popular games.

Most of the tournaments take place at the state-of-the-art G FUEL ELEAGUE Arena at Turner Studios in Atlanta. Gamma Labs, the Long Island company behind G FUEL energy drink, signed a $2 million agreement with ELEAGUE in January that included naming rights to the 250-seat esports arena.

These big-dollar deals are expected to get bigger as esports garners more fans—most notably in the coveted 16 to 34 (mostly male) demographic—and advertisers take notice. While the numbers are a bit of a moving target, SuperData, which provides data on the gaming industry, valued the global esports market at $612 million in a 2015 report, with an audience of 134 million and growing.

More recently, Newzoo, a market research firm specializing in digital gaming, says there are 148 million “esports enthusiasts” around the globe, and projects the industry to produce more than $1 billion in revenue by 2019.

While the NFL remains the most popular spectator sport, viewership for esports competitions, especially when you include the online audience, often outpace that of professional baseball, basketball and hockey. Moreover, esports events organized by League of Legends have sold out big arenas like the Staples Center in Los Angeles and Madison Square Garden in New York. And Seattle’s KeyArena hosts The International Dota 2 Championship, the most lucrative esports tournament in the world. Last year, the purse for the event was $20,770,460. The Masters, by comparison, is $10 million.

Naysayers who complain its ludicrous to call video gaming a sport are missing the point, says Christina Alejandre, general manager of ELEAGUE and vice president of esports for Turner Sports.

“Everyone has to remember, esports is still a niche sport. But it’s a very large niche with a very bright growth trajectory and a global reach,” she says. “As we continue to capture the live event experience and tell the stories of the gamers and teams, we believe the audience will continue to expand. I think the possibilities are endless.”

In a male-dominated industry, Alejandre is a bit of a pioneer. She has more than 15 years of experience in video games and new media, having previously worked for companies like ESL, Turbine and Warner Bros.

“I’ve been an avid gamer my whole life, dating back to the Atari games,” she says. “I’m very fortunate to have spent my entire career in an industry I’m so passionate about. One of the best things about esports is anyone can play them. Esports is one of the only sports out there where there is a level playing field for both men and women at the outset.”

University Esports

Colleges have also gotten in on esports. A few years ago, only a handful of colleges had varsity programs. Today, there are more than 40, including Robert Morris University in Chicago, Miami University in Ohio and University of California, Irvine.

The University of Utah recently became the first Power Five school to start a varsity esports program. A.J. Dimick, director of Utah esports, explains that the newly formed varsity program grew out of the university’s student-driven esports club, Crimson Gaming, which was founded in 2013 and, today, has more than 600 members who compete in national tournaments.

Dimick says the university’s Entertainment Arts and Engineering program is sponsoring the new varsity program. The nationally ranked EAE is a game-development program that caters to engineers and artists. Dimick, who graduated from the EAE program in 2014, says the university’s 35-member varsity team will compete in four games, including the industry leading League of Legends, starting in the 2017 fall semester.

“Everything you understand about mainstream sports should inform you about esports,” says Dimick. “They’re the same. We’re going to hold on-campus tryouts leading up to the fall semester to give incoming students the opportunity to make the team. We will find coaches who are experts at games, and the team will have regular practice sessions and tournaments.”

Initially, the team will practice in the EAE’s gaming lab, but Dimick says the university is trying to forge partnerships in order to build a 4,000-sq.-ft. space specifically for esports training and events. Dimick says he hopes more schools will follow Utah’s lead and launch their own program, which would help pave the way for a more formalized governance system similar to traditional sports at the Division I level.

“We’ve been trying to partner with other Power Five schools to see who might be interested in forming a more centralized governance of college esports,” says Dimick. “Right now, it’s kind of like the Wild West. Hopefully we can provide a template to help other schools get involved and, together, figure out how to take college esports into the future.”

Dimick says that while many universities can see the potential of esports, it’s still a challenge to educate some administrators. One of the biggest obstacles is that esports competitions aren’t consumed via mainstream media outlets like ESPN. Rather, the typical millennial watches the events on relatively new video streaming services like Twitch.

“This media is invisible to many older college administrators,” says Dimick. “You have these huge events with audiences bigger than the NBA finals, and it’s completely unknown to some groups of people. We have to help them understand.”

David Gillespie, athletic director at Midland University in Nebraska, admits, while he was familiar with esports, he had no idea of its growing worldwide popularity. That’s changed since Midland debuted the Warriors’ varsity program during the 2016-17 school year.

A common question from skeptics early on was, “You’re going to give scholarships to kids to play video games?’” he recalls. “My answer was that we have used athletics as an enrollment driver for many years. To me, there really isn’t any difference. This is another niche that gives kids an opportunity to do what they love and get a college education.”

Gillespie says the team currently has a part-time coach, and the university’s hope is to hire a full-time coach once they get enough student players. But recruiting can be a challenge, he says.

“Letting kids know about the opportunities here can be tough. You don’t have the typical recruiting avenues,” he says. “In football, recruiters go to games, check out the rosters and talk to coaches. But high school video gamers don’t have coaches. And online rosters are filled with names like Star Lord 99. You don’t know if that person is a high school kid or a 35-year-old gamer. We’re working on getting the word out about our program.”

Gillespie and Dimick both say an added complexity is picking the right video games. Unlike traditional college sports, where, for example, no one owns football or basketball, publishing companies own the video games,  which are always evolving and at the mercy of fickle players—constantly falling in and out of favor.

“You don’t want to overinvest in one game because if it becomes obsolete, so does your program,” says Dimick. “You have to be highly modular and adapt with the changing tastes.”

World Dominance

The teams at The University of Utah and Midland University both compete in the League of Legends video game as part of the Collegiate Starleague. CSL is the largest collegiate esports community in the world, hosting competitive video game leagues and tournaments across more than 900 college campuses in the U.S. and Canada.

Overseeing this growing enterprise is Wim Stocks, CEO of WorldGaming, a global online tournament platform that works with multiple game publishers and helps players connect and compete. Stocks, a former executive vice president at Atari, launched WorldGaming in 2010. Five years later, the Canada-based Cineplex entered into a $10 million acquisition deal with WorldGaming and now hosts the organization’s esports tournaments in nearly 700 of its movie theaters across Canada.

“Cineplex bought us because they saw all the heat around esports and the number of live tournaments that were springing up everywhere,” says Stocks.

WorldGaming uses its online tournament platform to qualify players to compete in live playoff events at Cineplex theaters. “These are 500-seat theaters with amazing Dolby sound, so it’s a really special, intimate experience,” says Stocks. “The crowds go crazy.”

Stocks says, a few months prior to being acquired by Cineplex in 2015, WorldGaming purchased Collegiate Star League. “We were originally on about 50 campuses. We invested in the infrastructure and the footprint, and, today, we’re the world’s largest esports collegiate organization. We expect to double our presence during the 2017-18 season.
The smart schools are recognizing esports can be a great recruiting vehicle.”

With Collegiate Starleague, all prizes are paid in scholarships, Stocks says. During the league’s grand finals in Toronto during the 2016-17 season, more than $100,000 in scholarships were awarded to the winning teams. For the WorldGaming movie theater tournaments, winning teams are paid between $50,000 and $100,000.

Stocks stresses that WorldGaming’s position in the marketplace is to provide accessible, small-scale tournaments to help aspiring players improve and qualify for pro-level events. “We’re creating a feeder system,” he says. “It’s really hard to be a pro player. The competition is fierce. We’re like the minor leagues to help players get better and show them the path to go pro.”

And once players do reach pro status, they’re living the dream, says Stocks, as 20-something gaming millionaires are becoming increasingly common. Moreover, the industry is likely to see more tournaments like Seattle’s $20 million International Dota 2 Championship emerge. Industry experts project that popular games like Overwatch are on track to garner more viewers than the NBA over the next three years. Even the esports color commentators, known as “casters,” are earning big bucks through endorsement deals and contracts.

“With so much money to be made, esports is only going to get bigger,” says Stocks. “From a global perspective, I think people are going to be amazed by what comes next.”

Photos courtesy of Turner