In our series of ‘Understanding the Industry‘ we’ve covered some of the most essential concept behind esports for our readers. Indeed, following the recent discussion around competitive CounterStrike: Global Offensive and the term ‘esports viability’. What makes an esport viable and what doesn’t? That’s what we’re discussing this time around.
The Cost for Developers and Organizers
Naturally, the primary step for the development of an esport is interest and support from the community. Ideally, yes, the title needs to have a large playerbase. Often, the size of the playerbase is proportional to the size of the subsection of competitive-oriented players. Anyways, kick-starting an esports scene is just like building a business and is nothing like game development. So, what does a developer such as Riot Games need to consider when attempting to build an esport as exemplified by VALORANT?
- Investing game development resources into developing a competitive and balanced title – sounds a lot easier than it is
- Consequently, the next step is constructing a framework, often layered, of competition – this involves scheduling events and leagues
- Setting prize pools which will attract hungry competitors
- Hosting live events, preferably with a live audience
- Listening to the community for feedback
Indeed, if all those are set in place – that’s great! However, esports viability considers heavily the element of participation.
Organizations and Players – Watched by Viewers
Signing into a new esport – what a massive change for an organization. Yet, I believe this term isn’t fully understood by most readers. What does it mean for an esports organization to sign into an esport, such as eUnited VALORANT from this week? I’ve listed a few more points to continue develop our discussion on esports vitality:
- The first step usually involves signing a roster. Accordingly, this involves striking contracts with players, offering support, branding and usually payment too.
- If the league is franchised, for example, landing a spot may involve quite a price
- Trusting the game to be competitively fair and viable
That’s it really. An esports organization is a business within much larger business – esports scenes.
Granted the above points, the same applies to players, By stating a ‘switch’ to another esport, a player is investing their time and effort into mastering the game. In addition, if it’s a team-based competition, finding the perfect teammates is another layer of investment. This second pillar is collectively the ‘competitive’ side of the esport – the chess pieces.
The third and most obvious pillar is that of viewership. It’s simple enough. If nobody cares, is it worth doing? Viewership doesn’t necessarily need to be massive, but correlating to the scale of the event. How so? A large event would want a large viewership in order to generate an equal amount of awareness. Accordingly, higher awareness makes investments from third parties such as sponsors more likely and may invite a greater competitive community.
Esports Viability – What is the Underlying Formula?
This entire episode of ‘Understanding the Industry’ comes in tandem with our discussion over CounterStrike: Global Offensive. In this case, many are finding the scene in question to be ‘unviable’.
For esports viability, it’s very simple. All of the effort and cost we just mentioned, for the developers, organizations and players simply NEEDS TO BE WORTH IT. And by being worth it, it usually involves all three of these components working together and supporting one another. Like that, I’d like to answer some common questions to make myself clear:
- What about viewership, doesn’t that contribute to esports viability? Indeed, yes it does, and I’ve considered it under the pillar of ‘developer’ responsibility. With viewership comes sponsorship – sponsors purchase ad revenue from the developers hosting the stream. Hence, if viewership is low, there is less incentive for sponsorship and hence, less funds coming in from this area
- Do low prize pools make an esport unviable? No, not necessarily. Especially if a scene is still starting out, a low prize pool will probably match the investing elements at that point in time. The problem comes if a scene outgrows the prize pool, which is an argument for CS:GO
- So if a developer is not listening to the community, could this make an esport unviable? ABSOLUTELY. Perhaps it might work for some time, but in the long run, a lack of communication will make the scene rather boring and stagnant.
All in all, I’d like to make one final distinction to conclude this discussion piece:
- Esports Viability is simply when net investments = net profit for everyone involved
- A growing esport is one where net investments < net profit for everyone involved
A Viable Esports Isn’t Necessarily Booming
A viable esport is not necessarily a growing one. Each esport usually goes through that period of growth – where tonnes of esport organizations are signing, players transitioning, viewers watching and plans being made by the developer. It’ll be up to multiple factors to determine how long this period is and how significant. That’s why if you see a tonne of organizations leaning towards a new esports – it’s a good sign!
There’s a lot more I can dive into, but I’ll leave it there.
We hope you enjoyed that! For more news and the associated State of the Community, stay tuned!
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