March 28, 2017
Introduction to The Meta Report
Summary:
Welcome to The Meta Report from Catalyst Sports.
Our Take:
Every week, we will utilize our expertise across esports and traditional sports to provide in-depth analysis and a unique perspective on esports news and larger industry trends.
Feel free to reach out directly at info@catalystsports.com
ESL Will Now Allow Cheaters to Re-join
Summary:
Last week, ESL announced that it will allow players banned for cheating to re-join its highest level of competitive play after only two years. This decision has been widely criticized by key figures throughout the community both because of the apparent leniency toward cheating and because of the inconsistency between the treatment of cheating and match-fixing (which is subject to a lifetime ban). While these points are fair, they ignore an important underlying issue that poses much larger problems for esports as a whole.
Our Take:
Decision making in esports ecosystems that are not publisher operated are far too fragmented. Regardless of whether or not ESL’s decision was justified, it will create inconsistent outcomes for high-level Counter-Strike: Global Offensive. Competitions organized by Faceit, Turner, PGL, MLG, and others are not subject to ESL’s rule set and therefore can treat cheating, match-fixing, and other misconduct differently. When all competition organizers prohibit certain behavior – such as cheating – this is less of a problem. But what about when one organizer prohibits conduct that another permits? For example, ESL is the only competition organizer that has a drug testing policy. This means that a player can be suspended from ESL’s competitions on a Thursday for violating the anti-doping policy and play in a marquee event that very weekend. That level of inconsistency is bad for the industry as a whole. We need to set clearer expectations for fans and competitors alike.
For more, check out Catalyst EVP Bryce Blum’s article on the subject.
Halo World Championship 2017: Balloongate
Summary:
This past weekend the Halo World Championship was held in Burbank, CA. Despite featuring an impressive $1 million prize pool and the top level of Halo competition in the world, the event was overshadowed for many by its production value, particularly now-infamous decorative balloons outside of the “overflow tent” area which many fans complained would not be out of place at a child’s birthday party. In fairness, there was a more respectable viewing experience inside the venue available to premium ticket holders. Still, many fans including well-respected owner of OpTic Gaming Hector Rodriguez have expressed disbelief that the organizers of the event allowed the world championship to end Halo’s competitive season with a whimper rather than a bang.
Our Take:
Halo is arguably the most iconic IP for Xbox and features an esport with deep roots that still inspires passion from a loyal community of players. At core, this is the fuel behind many of these complaints. There’s a sense that a Halo championship is worthy of grandeur, and fans feel indignant at seeing the event fall well short of that.
However, this event underscores yet again that the brand of an esport is joined at the hip with the brand of its game title, particularly when the game’s developer opts into taking a prominent role in the organization of the ecosystem. Decisions about resource allocation for production, communicating expectations with fans, and responding to feedback from the community are all crucial parts of running a live esports ecosystem which reflect on a game’s brand.
Clearly 343 is invested in the success of Halo esports and their in-house esports team is aware of the feedback. What remains to be seen is how they respond. With the esports field growing ever more crowded with more game publishers trying their hand at generating esports scenes and companies with high quality production arms such as Turner, NGE, and PGL expanding their portfolios of esports events, expectations for esports event quality have nowhere to go but up.
For more, check out Kotaku’s analysis.
Esports Industry Trend: City Affiliations
Summary:
The digital nature of esports has allowed fans the opportunity to select the team they support without the influence of hometown bias. However, despite Activision-Blizzard releasing some details about team franchising in the Overwatch League and Riot Games confirming last year that it is exploring “long term partnerships” with its teams it’s still unclear how city representations in these leagues will be decided. It’s been teased that Overwatch League will auction off the cities to the highest bidder, but we don’t know which cities are on the block. Riot Games, publisher of League of Legends and organizer of its professional league in North America, the LCS, has provided even fewer details publicly, and it is possible they’re less bullish on the concept than Activision-Blizzard.
Several esports teams have taken steps to solidify their own geographic presence, whether in preparation for franchising or to generate local fan bases on their own. NRG Esports (whose ownership group includes Andy Miller of the Sacramento Kings, Shaquille O’Neal, and Alex Rodriguez, among others) recently inked a sponsorship deal with Events DC, the convention and sports authority of the city of Washington, D.C. In August 2016, Jonas Jerebko (player on the Boston Celtics) bought the then LA Renegades, moved the team to Detroit, and re-branded the organization the Detroit Renegades. While we know city affiliations will be an integral part of franchising, the way in which franchise spots and city affiliations are determined will have a lasting impact on the success of each respective league.
Our Take:
There are three key factors that will play a part in determining city affiliations: 1) Access to capital; 2) Prior geographic presence; 3) Relationships with key decision makers. The first factor is intuitive. If you have the funds to outbid your competition and are willing to spend, you should be able to secure the city of your choice. This one-time cash flow will provide necessary operating funds for the league but could have long term consequences.
This city selection format could lead to unqualified ownership groups and could force out bidders with the potential to add more long-term value, but that would only participate if they owned a franchise in a specific city (think the Cowboy’s “Star” on a London based team…it just doesn’t make sense). Teams like the Cowboys, with a built-in fan base and headquarters in a region should be given priority in purchasing a franchise in that city. League-wide success will be greatly determined by event viewership. Media rights, sponsorships, merchandise and ticket sales will all be determined by the online viewership and ticket revenues. Why not get a head start by engaging fan bases that have already grown devoted to an existing brand?
The final factor that will likely play a role in city affiliation is the relationship to key executives at Riot and Activision-Blizzard. Peter Guber, co-owner of Team Liquid, a household name in esports, is also the co-owner of Los Angeles Football Club along with Brandon Beck, the co-founder of Riot Games. If and when it comes time to determine the future home of Team Liquid in competitive League of Legends, it’s a safe bet that Guber will be able to have his voice heard. Similarly, Bobby Kotick was seen sitting between his friends Robert Kraft (New England Patriots) and Stan Kroenke (Los Angeles Rams, Arsenal) at last year’s Blizzcon. You can be sure that if Kroenke wants an LA or London franchise and Kraft wants Boston that their friend Kotick will be listening.