Esports and Casinos: MGM's Bet

TNL Take: As casino’s continue to see a dwindling return on gambling revenues and how to get the millennials back in the door, they’re looking at esports to help grow their business.

Today we’ll take a deeper dive into MGM and where the chips are being placed.

 

01/ DEDICATED GAMING AREA

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Opened in late 2016, MGM spent $2M+ converting the former Rainforest Cafe into LEVEL UP, a dedicated gaming and esports entertainment lounge.

The 12,000-square-foot gaming area opened with standard fare like pool and foosball but also includes a laser golf course using AR technology and a VR experience. 

In 2017, MGM made several moves to incorporate gaming and esports further into LEVEL UP which we'll get to below.

 

/02 ESPORTS EVENTS

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MGM properties have hosted a slew of esports events including the 2016 League of Legends Spring Finals and MLG Las Vegas, both at the Mandalay Bay Resort and Casino. In early 2017, Dreamhack Masters Las Vegas featuring 16 teams and a $450,000 prize pool was held at the MGM Grand.

Recently, the MGM National Harbor in Maryland held the Rocket League Season 4 Championships.

To date, no one casino has held as many big esports events at their locations as MGM properties have.

 

/03 SKILLED BASED GAMING

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While slots contribute to a casino’s bottom line, they’re not being played by the younger audience. So what do you do? Combine video games and gambling — sorry skill based gaming.

In February of 2017, MGM installed Konami's first skill-based gaming machine, Frogger: Get Hoppin’, within LEVEL UP with a $2 minimum wager. MGM has also held free entry tournaments around Frogger as well.

In may, MGM Resorts International announced a partnership with Gamblit Gaming to bring two more skill based gaming titles to LEVEL UP — Gamblit Poker and Cannonbeard’s Treasure.

While the jury remains out on the monetization potential for skill based gaming, there’s clearly a need for the casino’s to bring back millennials to the table. 

 

/04 ESPORTS VENUE

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Things start to get bigger now. 

Allied Esports and Esports Arena announced to build an esports venue at the Luxor Hotel and Casino; which it makes it the first permanent dedicated structure on The Strip when it opens this year.

The former nightclub is being turned into a 30,000 square foot arena, which will include daily gaming stations and more uniquely, food made by renowned chef Jose Andres.

This partnership shows that MGM is committed to esports in Vegas and that the a permanent space can service both daily clientele as well as larger events at broadcast quality.

 

/05 INVESTMENT

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Late last year, MGM made a seed investment into Foundry IV, led by Tobias Sherman formerly of WME | IMG. Foundry IV is a new game studio that's looking to create the next big esports hit along with new revenue models.

"As a leader in the entertainment industry, we are focused on the continued evolution of esports and its importance as a strategic initiative for our company," said Rick Arpin, SVP of Entertainment for MGM.

MGM's involvement in Foundry IV could be used for anything from esports gambling, viewing parties to regional events. 

 

MGM has made plenty of bets across the esports ecosystem and will be exciting to see what else 2018 has in store.

Amazon + Ticketing + eSports = Opportunity

AMAZON + TICKETING + ESPORTS = OPPORTUNITY

Amazon + Ticketing + eSports = The Opportunity (Photo: Benjamin Faust)

Amazon + Ticketing + eSports = The Opportunity (Photo: Benjamin Faust)

Amazon + Ticketing + eSports = The Opportunity (Photo: Twitter)

Amazon + Ticketing + eSports = The Opportunity (Photo: Twitter)

There's definitely a huge opportunity in taking on Ticketmaster alone, which generated $1.6B in revenue in 2016 per BTIG's estimates.

But let's look at how Amazon can turn this into an eSports opportunity.

 

WHO WOULD THEY BUY?

The Ticket Fairy's Investor List (Photo: Crunchbase)

The Ticket Fairy's Investor List (Photo: Crunchbase)

There are plenty of ticketing startups that Amazon could look at. After I sent that tweet, a former MLG colleague of mine alerted me to the The Ticket Fairy.

Just Twitch COO Kevin Lin, Justin Kan and Emmett shear - the co-founders of Twitch - and Y Combinator, which invested in Twitch and gave the incubator a massive return.

This isn't a guarantee that Amazon/Twitch will choose The Ticket Fairy but the investor list overlap is pretty amazing.

 

WHAT COULD THEY DO?

TwitchCon 2016 (Photo: Twitch)

TwitchCon 2016 (Photo: Twitch)

TWITCHCON

TwitchCon is the easy first option, the massive event that Twitch has held for the past few years celebrating their influencers, fans and platform.

 

TWITCH PRIME

Amazon's Twitch Prime Move Is Genius (Photo: Twitch)

Amazon's Twitch Prime Move Is Genius (Photo: Twitch)

Now let's go deeper and what I consider one of the most brilliant moves that Amazon has done with Twitch:  Twitch Prime

Remember, Twitch Prime is all about driving Amazon Prime memberships overall, as the latter automatically gives you access to the former and increased value to the Prime platform - I don't even want to know how much I've spent using Amazon Prime Now with 2-hour delivery in NYC.

 

EVENTS

In March, Twitch announced that streamers would get a cut of any game sold through their channel. 

Now imagine this scenario.

Any developer based event that Twitch drives the ticketing platform can be further deeply integrated with both Twitch Prime and Game Sales. 

It can go even deeper than that.

What if you got an Exclusive item via Twitch for attending that event that Amazon just sold you a ticket for?

Overwatch Loot Box Via Twitch Prime (Photo: Twitch)

Overwatch Loot Box Via Twitch Prime (Photo: Twitch)

 

EVENT PLATFORM

Matcherino's Events (Photo: Matcherino)

Matcherino's Events (Photo: Matcherino)

Last month, I analyzed Matcherino's $1.5M round and how that platform helps event organizers crowdfund prize pools and help distribute the winnings.

How does Matcherino work?

Matcherino With Twitch Login (Photo: Matcherino)

Matcherino With Twitch Login (Photo: Matcherino)

Oh you just use your Twitch login and connect your PayPal account.

See it now.

 

THE ESPORTS TICKETING OPPORTUNITY

Amazon's potential move into ticketing is them disrupting another industry - when will the first Amazon health care facility open?

What's the accretive value to Amazon overall to get into ticketing? Ill let the Wall Street analysts do the math on that one.

 

But there's a huge play between Amazon, Twitch, eSports and ticketing.

TNL eSports Guest Podcast 006: Craig Levine, ESL CEO North America

TNL ESPORTS GUEST PODCAST 006: CRAIG LEVINE, ESL CEO NORTH AMERICA

TNL eSports Guest Podcast 006: Craig Levine, ESL CEO North America (Graphic: The Next Level)

TNL eSports Guest Podcast 006: Craig Levine, ESL CEO North America (Graphic: The Next Level)

TNL Take: On this edition of The Next Level eSports Guest Podcast series is one of the few people in the space that have been involved for close to two decades, Craig Levine - CEO of ESL North America.

Our fun chat covers:

-Our unique texting magic prior to his flying

-What eSports was like 10+ years ago

-Is the eSports "hype" helping or hurting the space

-The "sweet" spot for eSports event arena and capacity

-ESL's many platform distribution deals

-The platform wars and exclusivity

-Yahoo eSports and the eSports Media's future

-ESL's recent DisneyXD partnership and the need for shoulder eSports content

-ESL and Intel's massive new deal

-ESL's Future

-The most important question: Craig vs. Me on stage at the next panel: 1v1 - What's the game and what's the bet?

Hope you enjoy the conversation!

 

THE NEXT LEVEL ESPORTS PODCAST

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TuneIn

eSports Week In Review | Wunderman Brand Study, TV Ratings and Pro Sports Investment Rolls

ESPORTS WEEK IN REVIEW | WUNDERMAN BRAND STUDY, TV RATINGS AND PRO SPORTS INVESTMENT ROLLS

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NEXT WEEK ON THE NEXT LEVEL
 

  • EXCLUSIVE: 2017 COLLEGIATE ESPORTS REPORT UPDATE: 30 SCHOOLS, $3M IN SCHOLARSHIPS?
  • FACEBOOK EXPANDS FURTHER INTO ESPORTS
  • FINAL BRANDS THAT SPONSORED EA MADDEN'S CLUB SERIES
  • RECORDING TNL ESPORTS GUEST PODCAST WITH FRENCH SOCCER TEAM PSG ESPORTS HEAD YELLOWSTAR
  • MORE BRAND DEALS

 

Have a great weekend!