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Will eSports be a game changer for sports broadcasting models?

By Ian Hsieh, staff writer

May 18, 2016 | 7 min read

‘Real’ sports fans have, on the most part, looked down their noses at eSports, but with some 134 million people around the world watching competitive video gaming live, and revenues set to reach $1.9bn by 2018, it’s about time we got our heads round the world’s fastest growing sport, writes Ian Hsieh.

The stadium erupts. Strobe lights dance. Tens of thousands of fans are on their feet, cheering on their favorite team as the nail-biting action unfolds in front of them. Sounds like the kind of scene you’d expect of any big sporting event — whether it’s the championship game of an NBA playoff, or the final of the Fifa World Cup. But in this case, it’s an altogether different kind of activity that warrants the epic surroundings and rabid fans: competitive video gaming.

Otherwise known as eSports, competitive gaming is now the world’s fastest growing sport. Over 134 million people around the world watch eSports events live — whether that’s in person or on streaming platforms like Twitch — and its revenues are set to reach nearly $1.9bn by 2018, according to predictions by analysts SuperData. In the next five years alone, the eSports industry is expected to expand by 30 per cent, largely thanks to a surge in interest from Europe and the US.

Where it all started, though, was South Korea. In 1997, the Asian financial crisis laid waste to the country’s currency and stock market. To remedy the situation, the South Korean government began to focus on telecommunications. It laid the foundations for an internet infrastructure that was primed for super-fast connectivity, years before the rest of the world. And by 2000, PC Bangs — or gaming bars — were prevalent, utilising the country’s new internet capabilities and offering one of the cheapest forms of entertainment for South Korea’s youth.

Fostering vibrant communities of gamers, PC Bangs were the equivalent of neighborhood basketball courts — places to socialise with friends while honing a particular set of skills.

There were other factors at play that made South Korea the perfect petri dish for the eSports movement, which mostly involves games that enable large numbers of players to interact with each other within a shared world.

“Console games were too expensive in the 80s and 90s for most South Koreans,” says Eric Cruz, executive creative director of AKQA Shanghai. “There was also anti-Japanese sentiment where public displays of Japanese culture were deemed illegal. Corporations figured they couldn’t make money from consoles there, so developers made games built for PC consumption online, which gave birth to massively multiplayer online role-playing games (MMORPGs).”

Before long, eSports in South Korea were professionally organised with government backing, and the myriad TV stations (thanks to the country’s new infrastructure) began to broadcast competitive gaming. Professional tournaments that started in PC Bangs were fast becoming too big for their cramped surroundings. They moved on to hotels. And for the 2014 League of Legends World Championship (eSports’ biggest global event), over 66,000 fans packed out Sangam Stadium in Seoul, which was originally built for the 2002 Fifa World Cup.

As well as a capacity crowd, the event was watched live by 27 million viewers online. As context, the NBA finals series between the San Antonio Spurs and Miami Heat the same year reached a mere 15.5 million.


The International at the KeyArena in Seattle, where the prize pool totaled over $18m in 2015 — the largest esports prize pool to date for a single tournament

With huge audiences that are continuing to rocket (last year’s League of Legends Championship viewership grew to 36 million, with this year’s event in October guaranteed to exceed that), eSports are the perfect arena for brands looking to widen their reach.

“It’s big money,” says Cruz. “Globally, the gaming industry is bigger than the film industry. In movies and branded content, products sit naturally within the storyline. In games, you can interact and/or have to engage with the product before you can reach the next level — which creates a new way to interact with brands in a more immersive way. You can lead the viewer to experience your product by design.”

For just over a decade, companies in South Korea have been capitalising on the ubiquity and popularity of eSports in the country. Electronics giants like Samsung have sponsored individual athletes, some of whom have become multi-millionaires, earning the celebrity status of Kobe Bryant and LeBron James in the process. Training houses of teams that live together have also secured sponsorship, adhering to rigorous training schedules that incorporate both physical and gaming work for 12 hours a day.

“Players will become yet another endorser and channel,” predicts Cruz. “They’ll be traded, play for and represent their country on a national and international stage — eSports will become part of the global Olympics, celebrated by the masses.”

It’s mirroring how traditional sports work, and as Europe and the US begin to catch up with South Korea — offering up teams and training houses of their own — companies in the West are starting to take notice.

Red Bull, for example, which typically backs professional athletes in action sports, now sponsors Matt Haag — a gamer from Palos Hills, IL who goes by the moniker NaDeSHoT. And Coca-Cola started a partnership with League of Legends developer Riot Games in 2014, which has resulted in live streams of events at Cinemark Cinemas and extensive social engagement.

More recently, Coca-Cola launched a 22-minute livestreamed program produced in collaboration with gaming site IGN. The weekly show deep dives into games like Startcraft 2 and Dota 2. “It allows us to democratise our place in the eSports space,” says Matt Wolf, head of global gaming at Coca-Cola.

And with the likes of Yahoo launching Yahoo Esports — a gaming hub and guide featuring match scores, stats and schedules, as well as original video content — will we see a future where eSports actually take sponsorship away from their more established peers?

“While I think nothing can replace the real thing, eSports is becoming a formidable force to reckon with,” says Cruz. “Where it’ll get interesting is when the virtual becomes even more real and gains its own ground and right to play. As far as a captive audience goes, eSports are enjoyed by people of a more impressionable age. The demographic is right — mid-to-late teens — so it’ll be natural for brands to appeal to this audience.”

But the real impact of eSports might be much more profound than just another industry to immerse yourself in or a new audience to reach. It could be the catalyst that makes us pursue more leisure-based work. It’s already a viable career option for students in South Korea, and Norway is on its way there; Garnes Vidaregåande high school in Bergen is adding eSports to its curriculum this year, with a syllabus involving reflex, strength and endurance training.

“I think leisure-based work is in its infancy now and will be inevitable,” says Cruz. “As artificial intelligence replaces jobs, normal everyday workers will need to choose what to do with their time, making way for things they’re truly interested in. Passion will become the new currency, which will drive a new kind of economy based on people’s true interests. Everyone will pursue things they are driven and motivated by, and that will eventually unleash the creative age. It’ll push us to evolve the human race — making us more inventive, and more innovative.”

This article was first published in the 18 May issue of The Drum.

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