eSports Wars: Twitch vs. Everyone Else - Part 1


TNL Take: 9 months ago, I looked at the various companies, startups and platforms going after the eSports market in The Next Level 010: The War On Twitch.

How quickly things change.

When you're on top of the mountain, unfortunately the only place to go is down. Pre-Amazon acquisition, if you wanted to watch any eSports content, you pretty much went to Twitch.

Things started to change in 2016.

TNL Infographic 007: eSports Media Evolution 2016 (Infographic: The Next Level)

I steadfastly hold to my opinion that one of 2017's biggest eSports themes will be about broadcast and media rights.

Here's what's happened so far this year:

TNL Infographic 031: eSports Media Evolution 2017 (Infographic: The Next Level)

TNL Infographic 029: 2017 eSports TV Ratings (Infographic: The Next Level)

This past week, we saw another Exclusive broadcast deal, between FACEIT which brings their Counter-Strike based ECS (eSports Championship Series) to YouTube.

Not only did the ECS launch last year on Twitch, this is the 2nd Counter-Strike Exclusive for YouTube Gaming after it's January deal with ESL's Pro League.

This is interesting for a few reasons but let's recap what I said last year about YouTube and eSports:

The Next Level 010: The War On Twitch (Photo: The Next Level)

The Next Level 010: The War On Twitch (Photo: The Next Level)

YouTube basically didn't need live eSports considering how much many it's makes off VOD eSports and Gaming content - cough....Pewdiepie....cough.

Here's why I believe YouTube is making this move now.


If you go back over the last year, Counter-Strike has been in the top 3 eSports games by Hours Viewed and #1 for half of the year.  If you're selling ads - you need eyeballs and engagement.



Now that YouTube has both ESL's Pro League and ECS - and considering that ELEAGUE Season 3 hasn't been confirmed yet and IEM/Dreamhack CS events are also on Twitter now - Google has almost a virtual lock on Counter-Strike Exclusive content.



I'm just going to quote directly what FACEIT's Chief Business Officer Michel Attisani told Forbes:

"ECS is co-owned by the teams participating and there is a revenue share in place. This deal will bring great stability to the scene, and will give us the opportunity to really focus on developing the product, while the YouTube and Google sales team will take care of commercializing the content. That’s not just in terms of pure advertising but also in terms of sponsorship and brand integration. When you talk about Google, it's the best sales force in the world when it comes to digital"



TV Channels On YouTube TV (Photo: YouTube)

YouTube's new Live TV subscription service for $35/month has a ton of great content from channels like ABC, CBS, NBC, FOX, ESPN, 2 and 3, THE CW, FS1, BTN - if the last few sound familiar, they've all broadcast eSports content over the past year.

However there's another potential for eSports and Gaming content: YouTube Red Originals.

YouTube Red Originals will be included in YouTube TV's content package which contains a lot of gaming content.

Offering exclusivity, distribution, content, studio production and monetization - makes YouTube and eSports a lot more compelling than potentially other platforms.

Twitch isn't going to sit back and let YouTube, Facebook, Twitter and other emerging startups just take what they've built over the past few years.

How is Twitch going to strike back?

I'll cover that in Part 2.

eSports Evolution To Pro Sports Has Begun: Part 1

eSports Evolution To Pro Sports Has Begun: Part 1

2016 League Of Legends At Madison Square Garden (Photo: Riot)

TNL Take: I felt as if the first 6 months of 2016 saw a rapid acceleration of eSports investment and Pro Team involvement.

Comparing the speed in the second half of 2016 to the first half of 2016 would be like comparing Usain Bolt to Betty White.  I won't list the dozens of deals that have happened but you can see them all right here at The Next Level.

One of the big themes that I've been thinking about is not only why are Pro Teams investing in eSports but how will that transition affect the space going forward.

Now we're starting to see the early framework of how eSports and the Sports industry will mutually coexist.


South Korean Team SK Telecom 1. Yes, not a NA Team. (Photo: Riot)

As reported by Jacob Wolf of ESPN - who is a fantastic writer - Riot Games plans to require teams playing in North American and European League Championship Series to contractually employ their players and coaches in 2017.

What does that mean exactly?

What defines a contract in the US actually varies by state - I'm not even going to touch Europe.

So depending on what state a team is based in they could receive the following:

  • Healthcare
  • 401(k) plans 

The biggest negative is that teams will have to withhold taxes upfront like any contractual deal.

Well if teams still owe players $25,000 today, that should be a fun conversation.

This also means 14 teams out of the 20 (6 in NA and 8 in EU) will have to make these changes if they are true.

Riot Games is also considering doubling the current NA payment from $12,500 in North America to $25,000.  

What's this mean for the NA teams that now have to take on this responsibility? There has to be some built in stability for them as well.

Let me provide some perspective on 2015 revenues and salaries:

Riot: $1.6 Billion

Bus Driver: $27,000

Hopefully we will get some concrete info on Riot's potential plans soon but that's being poured right now to start the infrastructure needed for eSports.