An introduction to esports - Part 1

In this first insight we tell you everything you need to know about the current state of play with esports.

See part 2 in our esports series where we look at the most important legal issues for publishers, teams, sponsors and investors.

What are esports?

Esports involve the competitive playing of multiplayer video games by professional gamers, viewed by spectators. In addition, esports also encompass a broader multiplayer gaming ecosystem, which includes streamers and influencers casting “casual” gaming sessions, and amateurs playing esports titles from their console, PC, and, increasingly, their Android or iOS devices.

Are esports considered sports?

There is a significant debate on the future recognition of esports within the traditional sports ecosystem, due to shared common features such as skill and timing, training and physiotherapy, and concentration, competition and team play. In 2018 the International Olympic Committee launched a forum to discuss the inclusion of esports in the Olympic Games. However, until there is official recognition by a large number of sport governing bodies, or an esports exhibition event at the Olympic Games (building on events at the Asian Games), it is likely that esports will generally be considered as pure competitive entertainment.

How successful are esports?

The esports industry is fast growing and increasingly profitable, with its popularity still rapidly rising. Global esports revenues are expected to surpass $1bn in 2019 with over 450 million viewers this year tuning in to watch. The industry is lucrative with everyone from games publishers, players, sponsors and promoters profiting from the swell of viewers enthralled by the talent of individual players. The esports ecosystem presents many opportunities for keen investors and even traditional sports organisations are increasingly channelling investment into esports. A recent notable example is Celtic FC’s signing of an esports team to compete in the Call of Duty World League Championship.

"An increasing number of “non-endemic” companies (i.e. those not previously connected to the videogames sector), are now evaluating sponsoring an esports tournament or team to increase their brand visibility to a large target of potential consumers, especially “Generation Z” which engages less with traditional commercial campaigns." SportsGeneration, October 2019

How are esports organised?

Major esports competitions, such as the annual Fortnite World Cup and the FIA Certified Gran Turismo Championships, are organised through leagues and tournaments, and culminate in live finals hosted in real world stadia, with up to tens of thousands of spectators physically present and millions more viewing online.

Winners are awarded large cash prizes of up to several million dollars but there are also significant commercial and sponsorship opportunities at stake. Depending on the format of the underlying game, players compete either as individuals or as part of a team.

An esports team is usually structured as a traditional “sports club” with individual sections dedicated to a specific videogame with managers, coaches, mental coaches and physiotherapists assisting the “eplayers” in their everyday activities.

Successful teams are often part of large franchises or, as is the case for Cloud9, GenG and Immortals, raising investments, investor-backed, and compete in region specific leagues to qualify for national or global finals.

What is the longevity of an esport?

The nature of each individual esport is inherently precarious, as the longevity of an esport is usually dependent on the commercial success of the underlying game and the continued support and investment of the game’s developer. Regular maintenance, upgrades and balancing, along with the addition of new features are required to keep the game challenging, competitive and free from exploits.

Do teams participate in multiple esports?

Major esport teams often actively participate in multiple games, to reach a broader audience and prevent over-reliance on a single game which could be discontinued. For example, Team Redline include on their roster real Formula One drivers such as Lando Norris and Max Verstappen, thereby reaching a more mainstream audience and protecting against poor performance in unpredictable competitions or the underlying game being discontinued.

The core skills required to excel in one competitive game are also usually transferable, to an extent, to other games in the same genre. Justin Wong has won titles in the Evolution Championship Series across multiple fighting games, and Johnathan “Fatal1ty” Wendel has won titles across multiple first-person shooter games. Similarly, on the more “casual” side, the likes of SuperGT and Jimmy Broadbent stream to and reach audiences across Gran Turismo, Forza, and Grid.

Why are esports growing?

The success of esports lies in the passionate community of players, streamers and fans increasingly connected by advances in technology, but the industry is also backed by significant investors. Fans can choose to attend ticketed events and finals, or watch online through streaming platforms such as Amazon’s Twitch, Microsoft’s Mixer and YouTube, where the competitions are livestreamed. Traditional broadcasters such as the BBC and ESPN have been, and are increasingly, broadcasting tournaments live.

There is a huge emphasis on social media interaction with players encouraged or contractually required to promote games and competitions through non-traditional media platforms. Alongside the rise in popularity and profitability, there are increasing opportunities for young players to become professional gamers, with leagues and teams offering regular salaries and contracts.

"As a result of the significant growth in the industry, esports entities have developed top-notch skills related to the use of new media and cutting edge technologies, however they still need to be more professionalised in terms of business development and compliance with regulations." SportsGeneration, October 2019

What genres of esports games are popular?

Some of the most dominant genres are multiplayer online battle arena games (MOBA) and first-person shooters (FPS). In MOBAs, teams are pitted against each other and the goal is to destroy opponents’ bases or armies, winning points and resources to improve their characters and league standing. The competitive finals for some of the most popular and enduring games such as DoTA 2 (Defense of The Ancients) and League of Legends (LoL) are dominated by professional teams.

Popular FPS esports games include Counter-Strike: Global Offensive, Fortnite, Overwatch and Call of Duty, where individual players compete for resources and weapons to outlast and eliminate their rivals (with “battle royale” style game modes ever more popular). Leagues for these games are often structured in a professional manner which rivals traditional sports, for example The Overwatch League and the Call of Duty World League are highly organised with multiple qualification rounds and rankings.

What are common features of esports games?

Players often have the ability to choose from a wide variety of characters, each with their own unique features and abilities, and also to customise these characters further to project the personality and branding of the esports player, or their team. For example, competitors in FIFA esports tournaments have effectively an infinite number of player combinations to choose from when building their team. Competitors in certain racing games can paint their virtual cars in fully customised liveries, and most FPS games have a wide variety of weapon skins and decals available to players.

Esports games are often highly strategic and an intricate knowledge of the map, features and characters is a prerequisite to success. Competitive games are fast-paced and intense with professional players making up to 400 actions (decisions / clicks) per minute. An increasing number of games are free to play and monetised through in-game purchases, including loot boxes.

The esports industry is increasingly focused on building brands and monetising its audience through broadcasting, sponsorship and merchandising. Successful players in the esports scene may have several million followers and these influencers have successfully built their individual and team brands bringing in revenue through sponsorship and brand deals. The role and impact which successful and high profile players have in esports needs careful consideration.

This article was authored by Kireth Kalirai and Gabriella Simon, with additional input from Marco Tieghi and Edoardo Revello, managing directors & co-founders of SportsGeneration, an intermediary business and consultancy agency in the sports, media and esports industries.