United States: Esports Insights And Trends - January 2018

Leveraging its long history and extensive experience in all aspects of the sports arena, the Foley Sports Industry Team is actively immersed in the booming esports industry. Our Esports Insights and Trends will be a recurring post which is designed to deliver to esports industry insiders and watchers up-to-date information on the latest trends and developments in the fast-moving world of esports. To that end, today's post covers a variety of topics, including the intersection of esports with privacy, traditional sports models, science, gambling, college programs, and investment activity.

Big Traditional Sports Names Are Stepping Into Esports.

This is becoming more and more commonplace with every big name that enters the esports market. Below are some of the notable stories of big traditional sports names entering the esports market or furthering their already sizeable investments into the market . . .

The Sacramento Kings unveil esports facility inside Golden 1 Center. The center will act as a state-of-the-art training facility for esports, as well as a broadcast center and player lounge. To read more about this facility and how the Kings are encouraging the growth and development of esports players, click here.

Warriors, Cavaliers and Rockets join the League of Legends ("LoL") ranks. Three of the 10 franchises competing in the 2018 North American League Championship series are backed by the Golden State Warriors, Cleveland Cavaliers and Houston Rockets. For more info, click here.

Esports names in 50 most influential people in sports. Some of the SportsBusiness Journal's top 50 most influential in sports have invested in esports. For the full list, click here.

Mark Cuban's take on how the NBA and esports work together. The Dallas Mavericks' owner envisions tapping into the younger demographic with his team's foray into the inaugural NBA 2K League season. For his take on the investment, click here.

Manchester City signs second FIFA player. Manchester City signed Marcus "ExpectSporting" Jorgensen to represent the club playing FIFA in PlayStation 4 competitions. For more information, click here.

Schalke 04 presented a LoL squad to its soccer fans at a home game. The popular Bundesliga team is hoping its massive fan base will embrace its LoL team. For more insight into their plan, click here.

The Line Between Traditional Sports and Esports Is Blurring.

Esports organizations and traditional sports teams were organized very differently in the past and had different needs. Esports organizations are beginning to take on traditional sports models now, and are utilizing many of the same tools as traditional sports. Below are some of the notable stories from the past month regarding this topic . . .

OWL team, London Spitfire, hires British corporation to increase its foothold in the community. Similar to how traditional sports franchises focus on endearing themselves to the local community, esports teams like the London Spitfire realize how valuable it is to have their local community support them and are taking measures to accomplish that. For more info, click here.

NBA 2K League will feature in-game sponsors and ads just like its real world counterparts. Teams will be able to sell patches on virtual jerseys as well as virtual signage and logos on the court. For more info, click here.

Hearthstone Masters is another step in compensating esports players like a full-time job. Blizzard, the developer behind Overwatch, is taking steps to get Hearthstone players to commit to a professional player lifestyle. To read about how Blizzard is doing this with its vastly popular online card game, click here.

SK Gaming Partners With DreamTeam to create first esports and gaming recruitment and management network. Companies like DreamTeam have long-existed in traditional sports and their impact has resulted in more potential players being reached and their skills nurtured. As support for competitive gamers grow, so should the level of competition. For more info, click here. For more on how DreamTeam plans to help millennials pursue their professional esport careers, click here.

Google adds esports to its livescore feature. When you type the name of a sports league into Google, you receive league scores and schedules. Now, users will be able to do the same with esports. For more info on how Google has updated its livescore feature to incorporate esports, click here.

NRG CEO Andy Miller believes the Overwatch League is taking cures from traditional sports. For more on his take on how the Overwatch League is affecting the esports model, click here.

The Parade of Investments Into Esports Continues.

Investment deals into esports organizations are growing more frequent and larger and are coming from unexpected sources. Below are some of the notable investment stories from the past month.

Disney's purchase of Fox will have far-reaching effects and that includes in esports. Disney has been testing the esports waters with several recent investments . For a quick take on how Disney may use this acquisition to venture deeper into esports, click here.

Indie game developers set to receive $7.8 million grant from the Spanish government. The Spanish government will offer $7.8 million in grant money to indie developers to try to spur the industry and employment in Spain. To read more, click here.

Analyst firm Superdata say esports worth $1.5 billion in 2017. The firm predicts continued strong growth in the industry. For more information on Superdata's market report, click here.

Skillz, a mobile esports leader, sees growth with Series C round of $25 million. Skillz closed out 2017 with roughly three times the revenue of 2016. For more on this company with a three-year growth rate of over 50,000 percent, click here.

Manticore Games, a new game developer startup, secures $15 million in Series A round. The developer is currently operating in stealth mode as it develops a "hardcore multiplayer game." For more information on this new startup and its successful first round of investment, click here.

Towns in China are investing in esports. Zhongxian is one of numerous Chinese towns investing in infrastructure like stadiums for esports events in the hopes these investments will further stimulate their economy. For more information, click here.

Hong Kong is looking into its own government sponsored esports venue. A current proposal supports constructing a high-end esports facility in Hong Kong's Cyberport technology park as a way to foster the growth of the industry within Hong Kong. For more information on Hong Kong's potential investment, click here.

Google invests in Chinese mobile game livestreaming platform Chushou. The Series D funding round continues Google's trend of investing into the Chinese market and should help the very popular Chinese streaming platform secure its place at the top of the streaming market in China. For more info, click here.

BTIG rates Blizzard Games and Take-Two Interactive As "Buys." While the market analyst listed those two games as "Buys," BTIG says that the rest of the esports market is still an uncertain bet. For more information on BTIG's assessment of esports in the market, click here.

Mobile esports gets some much needed hardware attention with a smartphone designed specifically for mobile gaming. Super Evil Megacorp, the company behind mobile esports leader Vainglory, is partnering with Razer, a performance gaming peripheral company, to create a smartphone optimized for mobile gaming. The partnership should help level the hardware playing field for mobile games. For more information, click here.

Venture capital firm CrossCut Ventures raises $125 Million to invest into esports, AI, and more. The venture capital firm surpassed its goal by twenty-five percent, making the fourth fund for the firm larger than the previous three funds combined. For more info, click here.

Newzoo Whitepaper says that the European esports market is worth $209 million. This number would make the EU the second biggest esports market, after North American and in front of Asia. For more on Newzoo's EU esports market report, click here.

The Top 10 esports teams of 2017 won more than $1.5 Million in distributed earnings. As the prize earnings of esports teams continue to grow, they will undoubtedly continue to be targeted as financial investments. For more on how these teams made their money, click here.

Esports titles made up a majority of Steam's best sellers for 2017. While this list is limited to titles available on Steam, it provides a sample of the overall market, showing that esports titles are starting to dominate the video game market. The list does not even include some of the most played esports titles such as League of Legends and Overwatch. For more on Steam's top titles of 2017, click here.

The LA Dodgers have announced a new accelerator targeted at sports innovation, including esports. The accelerator targeting esports is another indicator of how the traditional sports world views esports as the next step in entertainment and fan engagement. For more information on this accelerator, click here.

ASUS Republic of Gamers (ROG) has reportedly invested $16 Million to set up a Chinese esports company. The company will focus on developing esports in the country with a focus on ticket sales, event organization, and player training. To read more about this company and the investment, click here.

Sponsorships Are Popping up Everywhere in Esports.

Sponsorships have been a mainstay in traditional sports for decades and are now reaching into esports. Here are some of the notable sponsorships that have been announced in the past month . . .

Alienware, Dell's gaming device brand, and top esports organization Team Liquid are partnering to create a state-of-the-art training facility. The facility will include a gym, in-house chef, sports psychologists, nutritionists and more than a few high-end gaming computers. For more info on this partnership, click here.

The Seoul Dynasty, an Overwatch League team, partners with Netgear's Nighthawk Brand to be its jersey sponsor. For more on this deal and what the jerseys will look like, click here.

FlyQuest is close to securing Snickers as a sponsor. For more info on this deal, click here.

Heroic signs a strategic partnership With CULT energy drink. For more info on this deal, click here.

G2 Esports and AOC, an electronics company, announce a sponsorship deal for gaming monitors. For more info on this deal, click here.

Cryptocurrencies Are Creeping Into Esports.

The esports industry seems to be warming to the idea of cryptocurrencies as developers like creating in-game currencies that are often exchangeable for real money. Below are some of the notable stories involving cryptocurrencies and esports for the last month . . .

Valve Corporation, owner of the Steam gaming platform, drops bitcoin as a payment option. While the company remains open to utilizing the cryptocurrency again in the future, the high transaction prices and volatility of the value of Bitcoin was enough for the company to stop using it for now. For more on Valve's decision to drop Bitcoin, click here.

Esports Initial Coin Offerings (ICOs) offer extremely high-risk investment opportunities. The Esports Observer takes a quick dive into the ICOs. For more on ICOs, click here. For an up-to-date list of ICOs in esports and how much money they have raised, click here.

Gambling and Esports Are Forming a Relationship.

Gambling and traditional sports have had a tenuous, but longstanding relationship. As esports becomes more mainstream, so too does esports-related gambling. Below are some notable stories from the past month related to gambling and esports . . .

UK continues to eye loot boxes after annual survey of youth gambling. The survey reported that participation in skin betting is increasing. For more on skin betting, the survey and the UK Gambling Commission's efforts, click here.

U.S. state legislator seeks to prohibit "gambling mechanisms" within games. Hawaiian state representative Chris Lee is particularly worried about loot boxes and their effect on the youth of America. For more information on Chris Lee's efforts and some of the research backing his concern, click here.

Esports betting company, Unikrn, loses its esports betting licenses in multiple regions. The loss of the license comes onth ehals of Luxbet.com, one of the oldest online betting companies, shutting down last month. Although Unikrn's licenses for betting in the UK and Australia came through Luxbet.com, Unikrn says it was prepared for the shutdown. For more on this, click here.

Unikrn and MGM Resorts will partner to bring esports tournaments and video game facilities to the MGM Grand Hotel. Unikrn will be hosting Friday and Saturday night events inside the MGM grand and awarding prizes of cash and UnikoinGold, Unikrn's cryptocurrency. For more information on this partnership, click here.

YouTube will reward its esports viewers with FACEIT loot boxes. As a result of its partnership with online competition platform FACEIT, Youtube will be dropping loot boxes for its viewers. The loot can be redeemed for a variety of real-world prizes. For more on how YouTube is getting into the loot box trend, click here.

Esports and Education ... the Times They Are a Changing.

Kids may now have a legitimate retort when their parents tell them to stop playing video games and do their homework: Collegiate esports Academic institutions are starting to foster esports skill sets. Below are some notable stories from this past month . . .

Some of the NCAA's Conference Commissioners question whether esports is a sport. While the Commissioners recognize the rapid growth of esports, most seem reluctant to embrace it as a sport. To read more about their hesitations and reservations about esports, click here.

A Turkish school is pioneering the "student-gamer." Bahçeşehir University is partnering with Riot games to offer an esports teaching module. The institution plans to start expanding this program to its international campuses starting next year. For more on this innovative program, click here.

Riot Games is revising its collegiate tournament format for longevity. The collegiate league's goal is to support a permanent structure that can easily accommodate new schools and conferences as they jump into the fray without having to make further major format changes. For more information on Riot's collegiate format change, click here.

The NCAA Peach Belt Conference, partners With Riot Games for collegiate League of Legends. The Peach Belt Conference will host a regular season competition, culminating in an eight-team, in-person championship in March. The champion and runner-up will then earn spots in the College Championship Play-in with an opportunity to advance to the League of Legends College Championship, held starting June 7 at Riot Games' NA LCS Arena in Los Angeles. For more on this partnership between the Peach Belt Conference and Riot Games, click here.

Riot Games extends Big Ten partnership through 2019; Offers $490k in Scholarships. After a successful first year in which 12 school-affiliated clubs competed, the partnership is growing to include more teams and more notoriety. For more information on this partnership, click here.

Blizzard Entertainment, the Fiesta Bowl organization, and Tespa, a collegiate esports tournament organization, are teaming up for the Fiesta Bowl Overwatch Collegiate National Championships in February. This will be the first time that a football bowl organization has teamed up with a game publisher to organize a tournament, much less one of this magnitude. For more on this exciting event, click here.

University of Akron will bring varsity esports to its campus in fall 2018. The program will mirror that of its traditional sports programs, complete with tryouts, uniforms, and mandated practice. For more on Akron's plans for its varsity esports teams, click here.

German soccer team Hertha Berlin launches an esports academy. The academy will focus on recruiting and developing players for the FIFA video game franchise using the model from its successful footballing academy. For more information on how Hertha Berlin is finding and developing the next great FIFA game talents, click here.

The State University of New York (SUNY) at Canton will add esports to its athletic offerings in 2018 and creating a residence hall for its esports players. SUNY Canton is doing more than offering esports as an athletic program, it also is offering esports as a lifestyle. For more on SUNY Canton's holistic approach to esports, click here.

Media and Marketing Are Becoming Very Important in Esports.

As esports continues to grow, so too does the desire to reach new players and consumers through the media and marketing. Expect to see esports becoming more ubiquitous in society. Below are some of the top stories form the past month involving the use of media and marketing in esports . . .

Twitch begins streaming NFL and NBA games. While there are a bevy of streaming services that stream traditional sports, Twitch made its name streaming esports and has easily become one of the biggest names in esport streaming. For more information on Twitch's crossover, click here.

Twitch's stream of NBA G-League games will be a new way to watch with fan commentary and interactive stats. An overlay will allow fans to access stats, chats and new ways to interact while watching the game. To read more about this new innovative way to watch basketball on Twitch, click here.

Lagardère Sports, a leading sports marketing agency in Europe, faced several challenges in its first year. The marketing agency has greatly expanded its portfolio and secured multiple sponsorships for several of its clients. For more on Lagardère Sports first year, click here.

EA Sports and FIFA are selling the rights to broadcast the eWorld Cup. FIFA is inviting bids for the media rights to its eWorld Cup in 2018. The event is likely to draw a massive global audience and, in light of the recent Twitch/Overwatch deal, setting high expectations for bidders. For more on the sale of the broadcasting rights to the eWorld Cup, click here.

Chinese live-streaming company YY Inc. is planning to spin off its esports video platform and seek a U.S. IPO. The spinoff platform, Huya Broadcasting, is hoping to raise at least $200 million to fund its expansion. For more information on this streaming platform and the already crowded market, click here.

The Interactive Advertising Bureau of Spain has created a committee dedicated to boosting esports in the digital industry. The agency also hopes to increase its market knowledge and win the trust of advertisers. To read more on this, click here.

Playwire Media and Unikrn have partnered to boost Unikrn's reach in the esports industry. The partnership should help Playwire can help Unikrn reach gaming enthusiasts online, while Playwire can use Unikrn to help penetrate the esports industry. For more information on this strategic partnership, click here.

Overwatch League/Twitch Deal Worth At Least $90 Million. The deal gives Twitchwill televise all Overwatch League matches. The matches will be free to watch but supported by advertising. For more information on this massive streaming deal, click here.

New Ways to Play and to Compete.

When it comes to esports, there is no defined subset of games that make up the sport. Esports at its core simply involves competing, sometimes against one person, sometimes against 100. Below are some of the month's top stories regarding new and blossoming ways to compete in esports. . .

The Razer 2017 Vainglory World Championship just held its last 3v3 championship before it switches over to 5v5. Vainglory's shift to 5v5 represents a changing landscape for its loyal following. It remains to be seen if the change in format will affect the games ever increasing popularity. For a picture gallery of the tournament, click here.

For the first time, real drone racers squared off against esport racers in Spain's eDrone Cup. The competition was conducted via virtual simulators and according to official drone racing rules. The goal of the event was to promote drone simulators in the world of esports, but it was also an interesting intersection of real-world and esports competitors. For more on this first-of-its-kind event, click here.

Overwatch's "Path to Pro" opens as bright-eyed teams compete with the hopes of one day making the Overwatch League. The Path to Pro system allows teams to qualify by competing in an open division, before advancing to the more rigorous contender trials. Successful teams can move onto one of seven regional leagues which serve as player development and scouting for the Overwatch League. For more information on how Overwatch is trying to create rags-to-riches stories out of its fans, click here.

League of Legends' new game mode has professional esports environment. The new game mode, called The Clash Tournament, will run twice a month and players will have to buy into the event. The tournament is designed to give a professional esports environment as competitors will be able to scout opponents and plan strategies, just as in professional tournaments. For more on how the new game mode will foster a professional esports environment, click here.

StarLadder announces a PLAYERUNKNOWN's BATTLEGROUNDS invitational competition with a $100,000 prize. The game's professional scene, similar to the game itself, has flourished in a short amount of time. PUBG could be the next major esports title that grabs the attention of major markets and support from Overwatch and League of Legends. For more on this tournament, click here.

Electronic Arts and Major League Soccer will team for a competitive eMLS league. Similar to the NBA2K league, the eMLS League will feature real MLS teams selecting players to represent them in FIFA matches. More details about the league should appear in April. For more on this story, click here.

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