eSport value chain - Leagues

2015-09-04 14:37

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I am currently writing this post and it is Wednesday evening. Watching CS GO PGL Fnatic vs Mousesports on Dust 2. Right now i am felling that this is really fun, blogging about invest in eSport. So lets get going. Todays (Thursday will this be publicized) topic are still the value chain and we are going to look at leagues.

So here we go. eSport value chain part three #3. So what are we going to talk about today? For you who missed the last post #2 about Teams can read it here: http://borstankar.se/esport-value-chain-teams/

And the first #1 post about value chain in eSports you'll find right here: http://borstankar.se/esport-value-chain-publisher/

Hope you'll enjoy reading!

We have already looked at Publishers and Teams. We have also talked about how they effect the market and how they are building moats to protect themselves.

Over to the different kind of leagues. You can go very deep in analyzing the leagues so we are going to stick to two. Major League Gaming (MLG) and Electronic Sports League (ESL). For you whom might not be all into eSport leagues works the same as every other sport, like NFL. And for you whom might be very into eSport know there are some differences, but let us keep it simple.

For a couple of weeks ago ESL hosted the ESL Cologne tournament. Final between Fnatic and EnVyUs. The final drew over half a million viewers on ESL broadcast on Twitch. And over one million watch the game "in game" if I recall this right. Impressive.

Well let us take a quick jump to south Korea. Korean eSport Association. I do not actually have any concrete source on this fact but multiple sources have reported that during 2013 Korean eSport Association had a total income from advertising of $203 M. So back to the states were MLG has opened a 14.000 square foot eSportStadium in Columbus, Ohio. That is just sick.

Except for the "matchmakers" there is betting sites as well. Just in usual sport you can bet on eSport, teams and players. There are no numbers on how much they earn but I can probably say that there are doing good.

So of course are Porters five forces here as well.

So we do as usual put Leagues in the middle.

Competitors of leagues are other leagues, of course.

We'll have the power of buyers.
Buyers go to the biggest games (fans). So a big party of all and becoming a big phenomena are a goal for leagues to strive for.

This will they do under threat of being substituted by a new, bigger, better or more rare thing. Not a league because that land under new entrants. But by new ways to watch and play the sports e.t.c.. Mainstream here are overrated.

Then there are the power of suppliers. What if they will stop making DOTA or CS GO? Well markets change so leagues must change as well.

New entrants: Here we can se new players on the same market. Maybe Google kicks up a league e.t.c.. Thats a real threats.

So what can the leagues do to keep their market position and take more market shares?

What to do:

Keep on changing and do not stop. Keep on evolve the tournaments and let the audience become a part of it. Todays evolvement of the markets are to involve the audience. Play by you self, check out new features and extra on websites. We did actually saw it for a couple a years ago in GTA 4. The choices you made changed the outcome of the ending. I know that was probably not the first but thats when we could confirm the changing of the market in a certain direction. Guitar Hero e.t.c. were big hits as well. We want to do more and more. Today you can share your progress in a game on Facebook with 2 (?) clicks on the controller of a PS4. So when this become integrated in groups and we share it with people in certain groups we are feeling a connection to that community. We are a part of a community. And we can step a side and just turn off for a moment to walk the dog and say hello to our neighbors, that is another community. Just the accessible different communities makes us pleased. And they have to be accessible for us to be able to visit them. We want everything an we want it all the time for a moment and next second we want it gone.

So leagues must create a community for the viewers. Were we can thrive in all the good things that we want for that moment. Yes, this is a big challenge but we'll have to see it in a larger perspective. For the business to thrive in the market and for keep on evolving the market there must be competitive leagues that creates value for the viewer. So after all for leagues it will all come down to draw the biggest stars and games to their leagues. Then they have to create value for the viewer. If you create value for the customer that no one else can you will gain a big marketshare just of being the guy thats creates value "to the people". We have seen it before and to top it all of, look at Facebook. That is creating all of those things in one place. Facebook is one of the leagues in social media. (Platform e.t.c. as well but you'll get were I am going).

So by creating value by changing the market and evolving the viewers involvement in a very accessible community are according to me the winning recipe for the leagues.

Please be aware that in a couple of years maybe the game creators be the ones that organizes matches. Look at the turns the movie business made when Netflix blew up. That changed the market completely. What happens if Google launches a similar service in the eSport market? Well that is enough speculation for today. What do you think will happen?

Thank you for all the great response for my texts. I know my english are not the best. So please bare with me.

eSport value chain - Leagues

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