Why this should be the last great North American League of Legends roster shuffle
Each year after the World Championship ends, a free agency frenzy begins. If esports truly wants sustainability, this year should mark the last one.
At midnight pacific on Tuesday November 21, 2017 ESPN Esport’s Jacob Wolf tweeted:
“The League of Legends global transfer period is officially open in all regions.”
By that time, Wolf — who is considered by many to be the esports equivalent to the NBA’s Adrian “Woj” Wojnarowski or the NFL’s Adam Schefter — had already broken nine stories about League of Legends pro players, coaches, and even full rosters transferring from one organization to another. Since then, the frenzy that has ensued has been nothing short of shocking.
Of the six teams that have been invited to become NA LCS permanent partners, only two — CLG & C9 — kept more than half of their starting rosters. Two other incumbents reportedly changed their entire starting fives – Team Liquid, for example, went on a shopping spree, purchasing the entire Immortals roster and two of the most sought after veteran free agents on the market: Impact & Doublelift.
With the introduction of four new franchises into the league this year’s shuffle was somewhat inevitable. However, the normalization of this type of offseason is bad for the long term sustainability of the NALCS as it results in a league filled with teams who lack a true identity.
In today’s League of Legends landscape, few teams can claim a true brand identity. Contrary to traditional sports, where teams can be recognized for their style of play, ownership, or legacy, a League team is confined to being seen as five guys who wear the same jersey, at that one point in time. The fact that rosters stay together for only one or two years prevents teams from developing real chemistry on the field and off the field, a clear brand image to fans and sponsors.
Following roster shuffles, fans of star players are conflicted: do they continue supporting their favorite pro on his new team, or do they keep supporting the team their favorite player has just left? This isn’t all that different from major sports – Lebron fans will stay Lebron fans regardless of where he plays, for example – but the frequency at which such situations occur in esports coupled with the lack of a geographic affinity for teams to maintain a core fan base, hurts organizations in the long term.
The result of fleeting fans affects a team’s bottom line: their brand partners who signed sponsorships expecting promotion from certain players are going to be disappointed to see those players go. Unlike traditional sports, where team brands carry significant clout on their own, an esports team’s greatest assets are their players who’s social following and streaming audiences drive the bulk of fan engagement. With players moving so frequently, sponsors might have to re-shoot content, create new creative strategies, or even mandate the use of their products – such as mice & keyboards — to players who prefer a competitor’s product. In the long term, this frustrates partners and complicates the sponsorship process.
Ultimately, it’s going to come down to the teams in the NA LCS to realize that a yearly roster shuffle is a bad strategy. Industry buzz words in 2017 were “investment” and “sustainability” – we saw plenty of investment and a good amount of sustainability through franchising and permanent partnerships. For me, 2018 will be about stability and non-endemics. The non-endemics will come; weather they stay depends on our industry’s stability.
PUBG is launching a mobile version in China
PlayerUnknown’s Battlegrounds, the hit PC game with over 20 million copies sold worldwide, has announced they will launch a mobile version of their game in conjunction with gaming conglomerate Tencent. Although no official launch date has been announced, the release stated the game will first be launched in China with Tencent promising a very similar experience to the PC version.
This news follows the announcement that PUBG will launch on Xbox One in early December. While console gaming is still limited in the amount of keys/buttons compared to traditional PC gaming, there is a precedent for game titles going from PC to console. The transition from PC to mobile, however, is much more arduous and raises many questions for me.
- How will controls be organized on smartphones with no keys compared to the elaborate layout of PC keyboards?
- How will users open doors, pick up weapons, and change weapons?
- Will mobile players be in the same matches as PC players?
- If so, how could mobile players realistically be expected to compete with PC players?
- If not, will this essentially create two different PUBGs? PC experience vs. mobile experience?
- Will the smaller screen and lack of controls create a negative experience for gamers or will they view the mobile PUBG as a “PUBG lite” that is meant to entertain them when they’re away from their PCs?
- How much will the mobile version cost?
- Same as the PC version or will it be free with in-game purchases like more popular mobile games?
If anyone can figure these issues out, it is Tencent. There is a huge potential market with over 660 million smartphone users in China as mobile gaming is much more accessible to potential users given the significantly lower upfront costs of the standard PC set up.
Esports' emerging markets
Emerging marketing in esports is a unique conversation considering the industry is far from its full potential. Many industry vets would say the big-time investment opportunities have already been made and the window for lenders to get involved has closed. The top leagues already have deep-rooted security and guaranteed revenue sharing. There is a lot of activity in Europe where companies like Activision and Riot are working towards creating new leagues and teams outside of Overwatch and League of Legends, and while this is exciting it seems clear that the subsequent round of investors will more than likely pay higher prices for smaller shares of these new teams. Many are looking for other markets within the industry that will need growth at the same rate of return that grabbed investors’ interest in the first place. Leaders have proven value proposition and that it’s possible to use the blueprint for success in other areas. There seems to be a lack of acknowledgment and broadcasting to those in the Spanish speaking regions, and that market has barely been touched. There is also a good amount of evidence showing huge opportunity in funding live Esports events.
Spanish is the third-most used language in the world after Chinese and English. We aren’t only talking about the Spanish speaking countries but also the large amount of Spanish speakers in Europe and North America. This is a huge demographic that could use better broadcasting and even entirely new leagues and teams. Newzoo reports that Latin America alone has 24.7 Million Esports enthusiast and is the #2 emerging market in the world. The fact that there aren’t very many professional leagues and teams established makes it an open market to implement a system that has already proven successful.
Live Esports events can seem tricky at first glance but studies show there is room for growth. A report done by Eventbrite says “48 million gamers in the U.S and Western Europe watch or participate in eSports, and over a quarter of these participants are attending live events. And these record breaking numbers continue to skyrocket year over year.” Newzoo also reports that globally, only 9% of revenue streaming comes from merchandise and ticketing. This is a lot smaller compared to most entertainment revenue streams.
So what is so tricky about this system? There is a good amount of information out there that proves esports fans still have more interest in attending traditional sporting events rather than attending a live gaming experience. The questions are who will be the first mover and decide how the experience will be and what’s most effective? We believe there needs to be more interactive capabilities for those coming to the live events. This will bring more fans out and differentiate it from watching at home with platforms like Twitch.
Indeed, there are already a handful of mobile and permanent venues being used. However, now that industry leaders like Blizzard are focusing on city-based teams that would eventually adopt their own home venues, there will soon be a more urgent demand.
Whether you are interested in building your own venue from scratch or collaborating with likeminded individuals, there are a handful of things to consider: most important would be Competition, venue/studio and programming. Since there is still limited live event competition opportunities, this gives investors an automatic upstart to compete with established arenas and venues. When creating permanent event space, being able to work with a blank canvas and something that is flexible by design can be very important. Designers have to be aware of capacity limits and pleasing sight lines. There should be a great sense of intimacy whether there is a small or large crowd. Just like any other industry, location is very important. In mass markets like China, having your venue somewhere that is easily accessible could be a deal breaker. Programming would be managed differently depending on the venue’s permanent or mobile status and location. If you were to put your arena in Vegas you would have to consider the ever-changing demographic because your customer base will change day-to-day in such a tourist destination. On the other hand, if you have a venue in a smaller town like Santa Ana, California you should probably consider a set weekly schedule that would have more of the same fans coming in every week for a particular game.
With all of that being said, if you can manage all of these hurdles in creating the perfect formula for a successful live esports space and increase revenue just 6%, you’re looking at a revenue stream of over $110 Million globally.