Disney's eSports Opportunity: 1 Year Later

DISNEY'S ESPORTS OPPORTUNITY: 1 YEAR LATER

Disney's eSports Opportunity: 1 Year Later (Photo: Time)

Disney's eSports Opportunity: 1 Year Later (Photo: Time)

TNL Take: Yesterday alone, there was an eSports news flurry:

And we end the day with this tiny news.

August 8, 2017: Variety: ob Iger: Disney Sets ‘Extremely Important Strategic Shift’ With Movie, ESPN Streaming Launches

August 30, 2016: The Next Level: Sports Media Evolution: Disney's Opportunity

Almost 1 year ago I looked at the various opportunities that Disney had across their wide media and distribution network.

Here is last year's article unedited now updated with what Disney has done within eSports across 8 different areas:

 

 /01 ESPN ESPORTS

ESPN eSports (Photo: ESPN)

ESPN eSports (Photo: ESPN)

When it comes to Disney and eSports we have to naturally start with ESPN.  When ESPN and eSports gets mentioned it's usually with two quotes:

ESPN President John Skipper said in 2014 after Amazon bought Twitch for $1B what he thought of eSports:

“It’s not a sport — it’s a competition. Chess is a competition. Checkers is a competition. Mostly, I’m interested in doing real sports.”

ESPN host Colin Cowherd said in 2015 that "he would retire if was forced to cover eSports":

Both of those sound anachronistic in less than two years but the truth is ESPN has changed their messaging - and so has Colin Cowherd.

Since 2014, ESPN has aired 300+ hours of eSports programming and dedicated a whole Sunday in July airing 18 hours across ESPN2 and ESPNU.

ESPN has also run three eSports programs this year and compared against E LEAGUE has performed fairly well; with EA Madden even beating E LEAGUE's Finals in the 18-49 Demo - usual qualifying statement on what analysis of early data means.

ESPN2 vs. E LEAGUE (Infographic: The Next Level)

ESPN2 vs. E LEAGUE (Infographic: The Next Level)

That’s only on the TV side.

ESPN has also done a good job on the content side with ESPN eSports and I’d even put them ahead of Turner’s Bleacher Report.

However with Yahoo eSports recent deal with ESL, which will bring actual live content, exclusive tournaments and new integrated Brand opportunities to Verizon’s properties; ESPN eSports is behind…for now.

 

1 YEAR LATER

What's ESPN eSports done?

We know what happened with Yahoo eSports.

ESPN eSports has been the leader in reporting and especially breaking news. Definitely an uptick in amount of content as well.

Here's where it gets really interesting.

Last year, they had 3 eSports events on ESPN2. The total is now 16 to date across ESPN's flagship channel, ESPN2, ESPNU, ESPN Deportes and DisneyXD  - with a huge new Sunday programming slate.

✔️

TNL Infographic 054: eSports On ESPN Networks and DisneyXD (Infographic: The Next Level)

TNL Infographic 054: eSports On ESPN Networks and DisneyXD (Infographic: The Next Level)

 

/02 VICE

Vice Gaming (Photo: Vice)

Vice Gaming (Photo: Vice)

I’m a huge fan of Vice.

Sure I miss some of their edgier magazine content but I’m still amazed at how these guys are worth $5B after watching them party across from my Brooklyn apartment in 2002.

Vice has clearly grown up but there still isn’t one content company which nails youth programming like these guys.

That’s why I’ve said repeatedly that someone is going to create the Vice for eSports – and it may even be Vice themselves after hiring Giant Bomb Editor Austin Walker.

Vice launched their Gaming vertical over a year ago and I was shocked at how much eSports content they covered. They’ve also naturally made one of the better eSports documentaries:

When Vice's new Gaming vertical launches, I'd expect even more eSports content. 

Disney's relationship is their $400M investment in Vice.

Disney, just go ahead and buy Vice.

 

1 YEAR LATER

What's Vice done?

Just launch a dedicated Gaming/eSports website and content called Waypoint.

Waypoint: Vice's Gaming and eSports Site (Photo: Vice)

Waypoint: Vice's Gaming and eSports Site (Photo: Vice)

Oh that last line about "Disney just go ahead and buy Vice".

Vice Valued At $5.7B (Photo: Hollywood Reporter/Getty/Bobby Bank)

Vice Valued At $5.7B (Photo: Hollywood Reporter/Getty/Bobby Bank)

$SNAP Snapping (Photo: Google Finance)

$SNAP Snapping (Photo: Google Finance)

Dear Bob Iger, as a world leader in content, Vice is the world leader in millennial focused content. You're launching an OTT network, Vice is perfect for digital. 

Assuming current valuation, Vice for 1/3 of Snapchat? That's an easy decision.

✔️

 

/03 BAMTech

MLBAM (Photo: MLB)

MLBAM (Photo: MLB)

Amazon has Twitch.

Activision-Blizzard has MLG.

Turner has NBATV.

Microsoft has Beam.

Owning both distribution and content is the quest everyone is after.

Now Disney has the same with their recent $1B investment into BAMTech, a tech company spun off from MLB Advanced Media - also huge kudos to the platform they've built.

Disney will use this BAMtech to create a standalone, cable-free digital streaming service without current linear ESPN content.

Now what type of content grew up on and is perfectly suited for this new platform?

 

1 YEAR LATER

What's BAMTech done?

An Exclusive $300M deal with Riot Games for League of Legends.

Disney now also has majority ownership of BAMTech, which will be the core driver for the future OTT/Digital platform.

✔️

 

/04 Disney Kids

Disney XD (Photo: Disney)

Disney XD (Photo: Disney)

I've spoken about my son's obsession with Minecraft and where Gaming and eSports will play a greater role in our education system.

There's a ripe opportunity to produce content at this early age. That may sound crazy but Disney actually did it already.

Twice.

Disney XD teamed with Nintendo last year to produce Clash of Karts: Mario Kart 8, one-hour show that put four teams of kids coached by YouTube influencers in a Mario Kart tournament.

YouTube influencers and kids....

Previously, Disney XD aired a one-hour special based on the Nintendo World Championships 2015, based of the earliest eSports events - when it wasn't even called eSports - back in 1990.

Nintendo, absolutely bring Nintendo World Championships back bigger.

 

1 YEAR LATER

What's DisneyXD done?

Launch a Sunday Gaming/eSports programming slate starting with the 2017 EVO Finals featuring Street Fighter.

The Next Level is working on something special on DisneyXD and will dive deeper into that.

You can also hear ESL North American CEO, Craig Levine talk about the partnership on The Next Level eSports Guest Podcast

✔️

 

/05 DISNEY PARKS

Disney's Upcoming Star Wars Theme Park (Photo: Disney)

Disney's Upcoming Star Wars Theme Park (Photo: Disney)

There have already been many eSports events in both California and Orlando, with Activision's huge Call of Duty XP event happening this weekend. 

Disney launched a program called Early Magic which lets guests into the Parks earlier with breakfast and other goodies. 

Just replicate the same type of thing for eSports.

 

1 YEAR LATER

What's Disney Parks done?

Considering holding eSports events at their 8,000 seat venue.

There's also a massive opportunity with EA's next Star Wars title.

✔️

 

/06 CHINA

Disney Shanghai (Photo: Disney)

Disney Shanghai (Photo: Disney)

Out of all the potential upside, this maybe the most difficult.

I've had an unabashed love of China and eSports over the past year and believe there's a huge market there.

While there's Disney Shanghai I'm not sure if they have deeper Chinese investment.

And there's that thing of China's richest man saying "I'll see your $5B bet and raise you another $5B".

 

1 YEAR LATER

What's Disney done in China?

As I mentioned, this would be the hardest one. The Next Level will also have some special news on China tomorrow.

 

/07 DISNEY GAMING

It's a shame that Disney shut down their Gaming division earlier this year. I felt that the Disney Infinity hardware/software bundle that Activision's Skylanders pulled off was a good product.

There's an obvious eSports connection here if Disney still had their old studio. I won't go deeper into why they shuttered that division as Jess Conduit already did a great overview

 

1 YEAR LATER

What's Disney Gaming done?

While not specific to Disney Gaming, Disney launched an accelerator program that includes axiomatic and Epic Games, publisher of Lawbreakers and one of the first to integrate with Discord.

✔️

 

/08 LUCASFILM AND MARVEL

Marvel and Lucasfilm (Photo: WDParkhoppers)

Marvel and Lucasfilm (Photo: WDParkhoppers)

Disney's purchase of both Marvel and Lucasfilm for a combined $8B is going to go down as one of the smartest bets on content ever.

Spotify is valued at $8B - which would you rather have?

Disney has the license to two solid eSports titles: EA's Stars Wars Battlefront and Marvel's Contest of Champions Mobile game.

Again the notion of calling something "eSports" is still debatable but in this case it's pure revenue sourced from internal sources or licenses.

 

1 YEAR LATER

What's Disney done with Lucasfilm and Marvel?

Take back the content from Netflix of which will definitely be included in the OTT/Digital service.  While nothing specific on the eSports side, the potential for both titles and content is endless.

✔️

 

CONTENT IS KING

I can't stop focusing on the whole idea of IP, Brand and Content. Not only from a Media perspective but from just a personal/business perspective as well.

Everyone today is - or should be - a Media Brand.

While Disney has a lot of core assets where eSports can provide accretive value, it's missing one huge piece:

Content.

There was that ridiculous previous rumor of Disney spending $500M to license Riot's League of Legends. - which I think is crazy.

Anyone want to buy some Olympics TV content?

While that price tag is high, Ill go ahead and say this:

Disney is going to make a large eSports content deal in the next 6 months.

 

1 YEAR LATER

So what's Disney done?

They signed the $300M BAMTech deal 4 months after the article. Content continues to remain king. Now Disney adds their own distribution. Increase and investment in 7 out of 8 is pretty good.

 

Well done Disney and ESPN team.