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Transcript of eSports
of the Future
By Ryan Whitcomb
What is eSports?
It stands for "electronic sports," or otherwise known as competative gaming. It's the spectatorship of professional players competing in titles such as Starcraft II, Call of Duty, or League of Legends just to name a few.
So what's the big difference from regular sports?
Not that much! Aside from the electronic nature of eSports, both harbor a high level of competition between athletes and are broadcast to viewers with professional shoutcasters to break down the events play by play. Take a look for yourself...
How do the two stack up?
In 2012, sports industry annual revenues hit $53.6 billion
eSports was recently estimated to be valued at only $194 million in 2014
Why is that?
"All they do is play videogames, they don't deserve it."
eSports teams take it as seriously as their traditional counterparts
Players are actvely scouted for their talent and bid on to be contracted onto a team
Teams have their own coaches and analysts to guide them in hours upon hours of practice of their mechanics and strategy
Some colleges in the US are awarding scholarships to eSports players
International players are being recognized as athletes for visas
What goes into creating eSports?
Comparing eSports to sports using League of Legends and Basketball
League of Legends
League of Legends Championship Series (LCS) and National Basketball Association (NBA)
LCS: Top, Jungle, Solo Mid, AD Carry, Support
NBA: point guard, shooting guard, small forward, power forward, center
Coaches, analysts, and other staff
Travel to events
Risk of injury increases costs to compensate players for that risk
Costs of facilities and equipment for practice
Little to no risk of injury - lower player costs
Computer equipment almost entirely provided for by technology sponsors
Easy to provide bonus content through free streaming online
Why eSports is a stronger competitor than sports in the entertainment market
"It's not as exciting as real sports."
Tell that to the fans that sold out the Staples Center in LA within an hour of tickets going on sale for League of Legend's World Championship Finals back in October 2013 with millions more watching online at Twitch.tv
Audiences for sports and eSports are not mutually exclusive
A higher potential for fan participation
Not everybody is built with the physical qualities needed for professional sports (disabilities, height requirements, etc)
i.e. No amount of training could help a 5'2" person get tall enough to play basketball or volleyball
eSports is less physically demanding, thus there is a greater potential for individuals to pursue it as a career or for fans to participate in the game
eSports players can connect with their fans directly by streaming
The more a consumer is able to participate and become personally invested in an industry, the more likely they will be to spend money on that industry
i.e. Watching their favorite player on Twitch.tv can lead to them buying merchandise from that team or buying a ticket to an event to see that player
It's always evolving
Games like Starcraft II, Dota 2, and League of Legends are always evolving with new content and game changes that influence play
Games are rebalanced to make competition closer and reward players' mastery over relying on dominant strategies
Competative play is drastically different from game to game; different champion compositions, different objective strategies, different visuals.
Influence on technology
Technology companies, like Intel, Logitech, and Nvidia, not to mention the game developers themselves, have a direct stake and profit in eSports
These companies invest into new technologies to further the experience of eSports, and their investment contributes to the growth of not only the eSports industry but the technology industry as well.
More jobs are available in the production of eSports.
i.e. Game developers hire game designers, concept artists, programmers, animators, etc.
eSports players actually use the goods of their tech sponsors for competition, which should have a stronger effect on persuading fans to also purchase that product.
A computer mouse has more impact in gaming performance than a soda does on playing football.
Going strictly off of costs
Assuming all else equal, if the sports market was compared to the eSports market, eSports would have an advantage of having a lower cost function. This would allow eSports to be able to privide more content at a lower price and come out on top over sports
Unfortunately this is not the case...
How things actually look...
Currently, the demand for eSports is much lower than that of traditional sports.
Consumer preferences in the United States
eSports' biggest issue is the cultural bias that US consumers have against videogames as a whole, driving the consumer preference for eSports way down and thus demand being so low as well
This is rooted in society's outdated bias against videogames for being tools that promote violence and laziness in children
Yet parents have no problem sitting their kids in front of a TV to watch dozens of men tackle each other over a ball...
The older generation in the US is much more resistant to change (I'm looking at you, Baby Boomers) and the technology-based world of eSports looks peculiar to those who grew up with limited technology, so they reject it for the more familiar world of traditional sports which have been around their whole lives
The future is eSports
eSports has been more accepted internationally in countries like Germany, France, and South Korea where it's held closer to the prestige of sports through larger live events and cable coverage
Growth of eSports in the US
New generations of consumers are more accepting of technology-based industries, so these consumers will be more likely to see eSports as a legitimate competitor to sports
Though still small in comparison, eSports is growing at a faster rate than traditional sports
Sports revenues are estimated to grow 4.8% compounded annually from $53.6 bil in 2012 to $67.7 billion in 2017
eSports is predicted to grow from $194 million at the in 2014 to over $465 million in 2017, more than doubling!