The following articles were authored by Ted Ottey

Thoughts on esports in 2016

Here we are. Another year with high expectations for the esports industry leading to the inevitable question of whether esports has finally “made it.” There is no doubt in my mind the industry continues to grow as we’ve seen more and more big names enter the market. Whether or not this constitutes esports “making it” is irrelevant in my mind. Like any business and industry, I think its important to focus on growth, sustainability, profits and other similar markers. The events of the past few weeks have been particularly interesting to me, raising questions about the current state of esports as it heads into 2016 and beyond – both good and bad. I’d like to kickoff this blog in 2016 by highlighting some of the major themes and trends I see becoming more relevant to the discussion of esports in 2016.

Acceptance and Respect

These seems like soft topics for what many are trying to make a serious industry, yet in many ways esports is mirroring current trends in society when it comes to discourse of these issues. One of the supposed attributes of the esports industry is the acceptance of the non-standard because esports itself is a non-standard. Yet very early in 2016, we have been reminded that this is very much not the case. Three weeks ago at the Starladder i-League StarSeries finals Dota 2 and CSGO shared a stage for playoff matches, rotating one match between the different games each day. This was met by some with much vitriol with comments such as “why are they showing this crapping game instead of  mine?” and “this game stinks put my game back on.” On the talk show Unfiltered several days ago, Richard Lewis and Duncan “Thorin” Shields spoke about numerous times various individuals within the industry actively try to negatively effect the work and success of others. And this is not even the first time these types of comments have been made this year. Finally, do we even need to mention the abrasive language that continues to be used throughout the industry, even by some of the more respected individuals.

Ultimately these types of situations remind us that despite our best efforts, esports is not as accepting and open as advertised. Much like current society, I don’t think these issues will be resolved directly or quickly. It will take time and effort. That being said, one sentiment that I found particularly apropos on this topic was that of respect. As individuals, we may not care for one esports game over another, but we can still show it some modicum level of respect with descending into mockery. Similarly with people, we may not care for everything a person does or says, but we can still show respect for them and their work.

Growing While Shrinking

One of the common misconceptions I think many people have about the industry is that it is growing rapidly everywhere and in every direction. While it is true the industry as a whole is growing, there are signs that it is also shrinking. Three weeks ago, Deloitte predicted a global esports revenue of $500 million, a number significantly lower than other estimates. In the report, the authors touch on a number of topics I won’t rehash, but I found it to be a very honest and sensible assessment of the industry as a whole. Elsewhere, the industry lost one of its oldest tournament organizers when Major League Gaming sold nearly all its assets to Activision Blizzard. ESL and ESEA continue to remain the dominant tournament organizer with DreamHack, Gfinity, FaceIt, Starladder and others fighting for viewership. When assessing each game’s competitive scene, many game’s publishers continue to exert and increase their control and influence over the professional scene with both positive and negative effects. In StarCraft 2 specifically, the game is going through somewhat of an identity crisis and potentially shrinking talent pool. See the aforementioned Unfiltered episode for further discussion on the topic. Finally, we’ve already mentioned some of the difficulties newcomers and outsiders face from those already within industry. As esports continues to move forward in 2016, one of my greatest concerns is that this consolidation of resources continues without seeing new businesses emerge in key sectors of the industry.

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Streaming as a Service

I recently finished reading the book Outliers: The Story of Success by Malcom Gladwell. In the book, Gladwell attempts to understand what makes certain businesses and people extremely successful. One of the key conclusions he makes is that extreme success is a result of hard work, a great product, and opportunity. As such, he contends that in certain industries, no matter how much work you do, your success will always be limited if there isn’t a large enough opportunity. While Gladwell has been criticized for oversimplifying his conclusions, this line of thought has led me an interesting prediction heading into 2016:

Twitch will remain the dominant streaming platform for both gaming and esports until such a time the streaming as a service market and what we understand to be gaming viewership changes, if it ever does.

Put simply, I don’t believe any company out there, regardless of how much money they invest or how good their product is, will be able to compete with Twitch unless they radically change our understanding of the streaming as a service business. In my view, Twitch has achieved that perfect mix of hard work, a great product and opportunity described by Gladwell. Twitch’s infrastructure, product, and most importantly their network effect is just too substantial at this point in time. Early efforts by Twitch’s competitors this year to break Twitch’s dominance have been met with significant backlash from various communities. For example, during the MarsDota 2 League (MDL) this weekend, an unofficial stream on Twitch by a group of pro players and their friends had 3.5 times more viewers than the official tournament stream with professional casters on Azubu. The result of all this? I would not be at all surprised if one or more of these rival platforms dissolved in 2016.

Esports Betting and Fantasy Games

I’m going to be very honest when I say I have significant dislike for most esports betting and fantasy esports games. Disregarding the ethical and potentially illegal nature of these activities, especially when it relates to minors over the internet, I view them as extremely harmful to the scene. At some level, I am comfortable with betting “skins” and “rares” on games as seen in CSGO and Dota 2, but I think what concerns me most is the extent to which these betting and fantasy companies have grown both in size and number over the past two years. Realistically, there just isn’t a large enough market to support this growth. Case and point is Vulcan, one of the hottest esports betting and fantasy sites of 2015. They rocked the industry last year with big investments, sponsored tournaments, teams, and more. Come January 2016, however, Vulcan shut down its paid fantasy and cut a quarter of its staff.

Disregarding the companies themselves, these activities promote behavior counter to professional competitions. Nothing could be a better example than recent news that top Korean StarCraft 2 professional gamer Life (Lee Seung Hyun) was arrested on match-fixing charges. Obviously the situation is still developing and we need to learn more, but this is not some middle-tier player accused of throwing games for extra cash. This is a GSL, WCS, and IEM champion; arguably the greatest player to ever play the game that we’re talking about being accused of match-fixing. If the esports industry needs more proof of the potential harm of betting and fantasy games without sufficient protections and regulations, I don’t know what more would convince you.

Breakthroughs and Market Disruption

It is my firm belief that if esports is going to continue to grow over the next 1-3 year span, it’s going to have to look for new and innovative products and services that disrupt the market. I do not believe solely continuing to finesse and improve what we already have (tournaments, streaming services, etc) will result in a trajectory of growth many are hoping for. At some point, what we have is going to reach its peak and we’re going to be left asking what’s next? I have a few thoughts on this, but without going into all of them, I will say that I believe statistics and real-time data will be a big part of esports in the next year or so. In my view, we are going to need to expand our various technologies and APIs to become more robust and comprehensive than what they currently are today. “Companies that successfully aggregate multiple services in a single interface have a chance of really shaking up industries,” wrote Scott Belsky, VP of Products and Services at Adobe back in 2014. I believed that to be true then and I believe it now. There are many individuals already working on various products and services around data and a year or two from now, I suspect at least one of them to breakthrough with real market disruption.

Outlook and Conclusion

While some of my comments above may lead you to believe I have a negative outlook of esports heading into 2016, nothing could be further from the truth. I am extremely excited to see how the industry develops over the next 11 months. We’re going to see insane plays, awesome entertainers, and better products and services in 2016. Will there be problems? Sure, absolutely. But enjoy it now, because from fan to professional, this is the best time to be involved in esports at any level.

 

Looking for leaders

Earlier today Cassandra Khaw published a piece on eSports journalism entitled As eSports booms, journalists struggle to find acceptance – and paychecks. It’s a well written article and while I’m sure much of the discussion surrounding it will be about the money, I’d like to take a moment to recognize another subject Khaw brings up in the article:

Readers unhappy with the state of eSports journalism could volunteer as replacements for journalists they found unfit … eSports journalism really needs its rare, long-term veterans to “stick around” and provide tutelage to new writers.

The subject of tutelage when it comes to eSports journalism is often something that is overlooked. New journalists volunteer for organizations wanting to make a difference (as well as a name for themselves) and often have little to no experience working in eSports or writing to any degree. When these volunteers join our eSports organizations we don’t do a good enough job orienting them to our company, culture, policies, technical requirements, and industry information in order for them succeed. These volunteers need to know and understand how our organization works, what our writing policies are, how to use our CMS and other technologies, and who to work with to get content written. As a result, many volunteers often do not last longer than 3 months at a given organization. They feel neglected, left out, and yes – still not paid.

Being a senior journalist or editor means you have significant experience and skill at creating content, but not all of these individuals are adept at leading a staff. Building a successful organization requires leaders, not just skilled content creators. An eSports organization needs people to teach volunteers how you turn a breaking news tweet into a respectable 4 paragraph written story about that piece of news. Organizations should help volunteers navigate the various personalities and organizations within the industry to help them gain access to information and interviews. Most importantly, these leaders should strive to help the volunteer achieve their own personal goals. If you have someone who starts out writing the short breaking news articles, build them up. Work with them, and eventually transition them into more feature length content. When these volunteers see their own personal growth within your organization, they are more likely to stay and keep growing.

When I started writing in eSports almost a decade ago I was fortunate enough to work with some truly dedicated individuals who helped me learn not only how to write eSports content, but also how to navigate the industry and build relationships. When I eventually started to lead my own content teams at Amped eSports and ESFI, I tried to bring that same level tutelage to my own staff. Sometimes it was less than fruitful, and sometimes it was my fault. Other times, I got to see my staff succeed and go on to stay within the industry for years afterwards.

Poor leadership, regardless of the skill of those who may be on staff, is identifiable. High volunteer turnover and a small number of people producing the majority amount of the content are quick signs.

Some might argue these issues could be resolved by simply paying writers and not using volunteers. While I agree with that thought in concept, it still doesn’t excuse the industry from doing a poor job at teaching new volunteers eager to help and make a difference. Not every volunteer is going to turn into the next 10 year seasoned eSports aficionado, but the industry needs to do more to empower those looking to get there.

When I look at the current state of eSports journalism, I continue to struggle at spotting up-and-coming talent or seeing real progression within the industry. Maybe its because the scene is so big. Maybe its because people are indeed less motivated in 2014 than they were in 2004. Maybe its the million other reasons the people at the top of the industry give for volunteers being less productive than in years past. Whatever the reason, I simply don’t buy it. eSports needs more leaders and teachers. Its up to those who have the experience and knowledge to help nurture the new wave of talent.

Before you are a leader, success is all about growing yourself. When you become a leader, success is all about growing others.
-Jack Welch, former CEO of General Electric (GE) from 1981-2001

No see, no buy

Yesterday afternoon a curious Twitter account called the NESL caught the attention of many people within the eSports Twitter-scape. Named the National eSPORTS League, the goal of this new organization is to “take eSPORTS to the next level & changing the way the community is managed, played, and portrayed – The next step in eSPORTS.” Over the next 6-8 hours many individuals throughout eSports tweeted at the account asking for more information or providing what I will call useful criticism. Some of this criticism centered around the branding problems of naming a new eSports organization extremely similar to an established brand (the National ESL). While that was definitely an issue (one that is apparently being fixed with a re-branding), what stood out to me was something else entirely.

Look, I’m all for new blood entering the scene and I think entrepreneurial ventures within eSports is an important thing, but this NESL (not National ESL) situation highlights one of the biggest problems surrounding companies within eSports today – marketing.

Now that may seem like an odd statement considering the fact eSports as a whole is essentially driven by a marketing and advertising effort, but within the industry there is sever lack of effective marketing and quality execution to follow. Let me simplify this problem to fit the current scenario a bit better.

Back when I was in graduate school, I had a marketing professor who worked for years at Proctor & Gamble (P&G). For those who are unaware, P&G owns just about every brand that you have in your house from Tide to Gillette to Crest to Duracell and everything in-between. P&G is considered a market leader in marketing and brand development. Back to topic at hand, my professor told us the most important thing he ever learned about marketing came during his time at P&G while he was still relatively new and working for one of their senior marketing staffer. This senior staffer used to tell him if he were to learn anything about marketing at P&G, it was this nugget – “No see, no buy.”

The concept is as big as it is simple: No see, no buy. If your customers cannot see your product or service, chances are they aren’t going to buy it. This tenant is one I see many within eSports violating and my primary problem with this whole NESL situation. It’s understandable that when you are new within an industry that you may not have everything figured out yet or even have the resources, but you have to be able to demonstrate some value or at least the intention of value. Operating from a single anonymous Twitter account or email address and offering little information about the people or plans behind the business, outside cliche phrases such as “taking eSPORTS to the next level,” has probably done more harm to NESL than if they waited a few weeks and kept things under wraps until they were ready to show more.

The eSports industry has seen and heard too many of these cliches from the likes of CPL, CGS and others to bend quickly at the knees at every request without any substance behind it. The problem is really just that simple. No see, no buy.

And then esports happened yesterday

A day after the StarCraft 2 community was treated to the excellent (and I do mean EXCELLENT – you should all go read it now) piece by Duncan “Thorin” Shields on the career of SC2 pro Johan “NaNiwa” Lucchesi, the StarCraft 2 community went through another exercise of embarrassment. Sticking to his aforementioned plan to release content about various broken promises within the eSports scene, Richard Lewis of Cadred posted the first part of his series: The Land Of Broken Promises #1. Whether or not you agree or disagree with all or part of his article is irrelevant to me. What I want to bring attention to is the aftermath that ensued on Twitter following the publishing of this article:

 

 

 

 

 

The above is not even a drop in the bucket of the number of back and forth tweets that invaded many people’s timelines yesterday, but hopefully you get the idea of where this is going. This is an embarrassment of epic proportion on all fronts. For starters, most of the drama yesterday had nothing to do with the actual content Richard wrote about, but rather the actions and reactions of individuals surrounding the publication. This was mostly centered around Richard’s failure to credit photographs within the article and the use of a derogatory slur to describe one of his detractors. As someone who produces narrative content, this downright awful. If a piece of content garners more reaction to the actions and reactions surrounding the publication of the piece rather than the content within, you have failed in crafting a meaningful narrative.

Secondly, someone of Richard’s caliber and experience should know to credit photographs. Now perhaps some of the copyright holders were a bit angst in expressing their frustration, but nothing I saw warranted the berating that ensued. Finally, the use of any derogatory slur or term regardless of intent is simply wrong. For his part, Richard has apologized for the use of this language, but given how this apology comes a day later it lacks a certain amount of authenticity.

This incident is only the latest in a series of embarrassing back forth bickering that has occurred over Twitter and other mediums. While everyone likes to talk about professionalism in eSports and the scene growing, these incidents are a reminder of just how far the industry still has to go in order to reach the level many want it become. From an outsider’s perspective such as mine, the hilarity, immaturity, and downright foolishness of the entire situation across the board is appalling. These are the things that continue to degrade the eSports industry bit by bit, and given the penchant for similar situations to occur again, it almost makes you wonder how the industry even managed to get this far.

e-Sports needs less content & more coding

E-Sports is volatile industry. Ask anyone who has been in the business for any significant amount of time and they will probably tell you something similar, perhaps coupled with a painful story. For all the fun, excitement, and entertainment it provides, e-Sports as a whole is significantly lacking when it comes to sustainable business models. This means we see a lot more failure than success, and even in the success stories we see struggles to keep up. As a thought exercise, I created a list of companies within the e-Sports industry who are successful and have operated over an extended period of time. My thinking was to identify key parts of these successful businesses that separate them from others. The results were simply staggering.

Not only is there not many long-term successful companies in the industry, even the successful ones are hard to differentiate from one another on a macro level – they all are doing relatively the same thing. Trying to look past this fact, I came across a startling common point when looking at arguably two of the most successful companies in the business. This realization was that the core of their business, what drives their ability to attract users and generate revenue, is leveraged via the unique technology they have developed. These companies could quite possible be more appropriately categorized as technology companies (read not e-Sports companies) who leverage the e-Sports industry to generate revenue.

The first company I want to discuss is arguably the most successful currently operating within this space today: Twitch TV. Before you head angrily to the comments, I know Twitch does more general gaming than just e-Sports, but the fact is much of the platform’s initial rise in popularity and continued use is due to the e-Sports community. As most people know, Twitch is a DIYS live streaming platform and community specifically tailored for the gaming scene. Their revenue, like most within the e-Sports industry, is tied to advertising.

Where Twitch differs from most, however, is that they do not directly generate content. Rather, they have built this technology platform that allows other people to generate content and are able to leverage the content their users’ create for ad revenue. Obviously, this is not the only revenue stream for Twitch. Without knowing the intimate details, it would be fair to say Twitch also probably generates revenue via partnerships, their new Twitch Turbo premium service, and external funding (private, venture, etc.) to name a few. Most if not all these methods though, are predicated on their ability to develop and maintain their technology platform for increased user engagement (which leads to increased advertising revenue).

The second company I identified was ESEA Entertainment. ESEA has faded out of the spotlight for many since the rise of the RTS and MOBA genres and the lack of a successful team based FPS (prior to the release of CGS:GO). Similar to Twitch, ESEA has developed a technology platform (their premium client) which they use to run leagues, ladders, anti-cheat, gather game statistics, and more. This technology drives ESEA’s operations and its premium subscription creates a solid revenue stream that isn’t solely based on advertising and sponsorships.

My purpose for highlighting these two companies is twofold. First, to highlight they are operating successfully, but in a different manner than most of the e-Sports industry. And second, to call attention to the realization that we as an industry need more technology. We pride ourselves for our progressive thinking that video games can and should be viewed as sports, yet we are woefully lacking in the support technologies for managing leagues, running live events, coordinating team operations, and more. Sadly, most of the businesses within the industry easily fall under the “content creator” label in which they produce some form of content and try to earn revenue from the content they produce. Not only is the industry over-saturated with this type of offering, but many of these content creators’ operations are severely lacking compared to their “real world” counterparts. Don’t believe me? Here are two simple exercises for you:

1) Go to your favorite league, show, team, website, etc. that produces content and evaluate how accessible their content is across different device platforms. Most these producers have horrendous multi-device support – if at all – compared to similar producers within “real” sports.

2) Again, visit your favorite league, show, team, website, etc. and evaluate how accessible their branding/logo assets and guidelines are to the general public. Needless to say, I wouldn’t hold my breath – most simply don’t have these assets and guidelines available.

The simple truth is the e-Sports industry isn’t nearly as progressive as we like to believe, and one of the major areas in which we are lacking is our technology. We need more coders, designers, and engineers building technology for e-Sports and less of a desire for the same cycle of monotonous content production outlets.

Looking back at Twitch and ESEA, despite their operational stability both companies face their own challenges. As previously mentioned, ESEA needs to find a way to expand its operations in an age where the team-based FPS genre is not dominant.  Meanwhile, Twitch has struggled with changes in ad rates, partner payouts, and an inferior European network compared to their North American counterpart. But perhaps what is most egregious is Twitch’s severely lacking mobile development, especially on the Android platform.  Although they have recently promised a renewed commitment to Android development and even opened a new beta program, it seems extremely odd that a content delivery platform such as Twitch wouldn’t be more focused on mobile accessibility across the board.

To that end, I decided to spend a few hours of my own time over the last few days to create a concept design for a new Twitch android application. My approach was simple: design a basic framework for a Twitch application which could handle substantially more functionality. You can find my concept designs below. In conclusion, I’d strongly implore those looking to get involved within the e-Sports industry and those already working within it to think about the things I’ve mentioned here and ask yourself if you could benefit from better technology and operations.

The following are simply concept designs and I have no direct affiliation with Twitch TV. Any logos, assets, brands, or other materials used below are copyright their respective owners.

Click here to view large version.

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