Complexity
Members of Complexity Gaming in their training facility at The Star in Frisco, Texas.
- While the coronavirus pandemic has left most forms of live entertainment on indefinite hiatus, esports leagues are quickly moving to online-only formats.
- Esports with teams spread across Asia, Europe, and North America have been monitoring the outbreak of the coronavirus since January and cancelled weeks worth of live events before making the decision to go broadcast online without fans in attendance.
- Though the professional gaming industry is well-suited to continue while professional sports are on hiatus, the shift to online competition will present new challenges and league organizers still believe that live events are vital for growth.
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The threat of the coronavirus brought an end to normalcy worldwide last week as many government officials and health experts urged the public to avoid large gatherings to prevent its spread.
But while most sports and other forms of live entertainment have been put on an indefinite hiatus, the esports industry has an opportunity to bring its product directly to a captive audience at home.
Professional gaming relies on live events and has been of the many industries to be heavily disrupted by the spread of the coronavirus. But the ability to organize esports online instead of in-person will allow competition to continue during the ongoing period of social distancing recommended by health officials.
Esports with teams spread across Asia, Europe, and North America have been monitoring the outbreak of the coronavirus since January as government officials in different countries set guidelines for travel, health screenings, and public gatherings. By the time the major US sports leagues decided to suspend their seasons last week, the Overwatch League and "League of Legends" esports events had already been forced to suspend weeks worth of live events in China and South Korea.
Though esports is mostly consumed online, Activision Blizzard and Riot Games both host their esports events in front of live audiences and bringing thousands of esports fans together for an experience that is seen as vital for growing the industry. Activision had planned events in two dozen cities worldwide during 2020. But as the coronavirus spread, multiple esports leagues quickly began drafting plans to replace their live events with online-only broadcasts.
As of March 16, Activision Blizzard had shifted all Overwatch and Call of Duty League events for March and April to an online-only format, while Riot Games will be hosting matches without a live audience until public health guidelines change.
"Esports events have been an integral part of illustrating the industry's rise to prominence since it enables people outside of gaming to see how the massive crowds and professional production rivals what they are acclimated to experiencing at a traditional sporting event," said Doron Nir, the CEO of streaming service provider StreamElements. "That being said, the online viewership has always dwarfed in-person attendance and there have been successful events that have been executed solely online. Twitch Rivals is the perfect example of an esports league that regularly attracts over 100,000 [concurrent] viewers for their online-only events, so there is definitely a path for other major events to follow."
While live events can generate revenue through ticket and merchandise sales, esports leagues make most of their money from sponsorship and media rights deals. During 2020, the industry was expected to generate $636.9 million from sponsorships and $185.4 million from media rights, compared to $121.7 million in merchandise and ticket fees, according to data from Newzoo published in February.
By maintaining a regular broadcast schedule, esports leagues can bring even more value to sponsors during this international period of social distancing, helping advertisers reach their target demographics while campaigns built for traditional sports are on hold.
For instance, thousands of fans were barred from attending the Intel Extreme Masters Katowice in Poland from February 28 to March 1, but the event's livestream set a viewership record for "CounterStrike: Global-Offensive" with more than 1 million concurrent viewers. China's League of Legends Pro League resumed with online matches earlier this month after a six-week hiatus, and Activision Blizzard expects the Overwatch League and Call of Duty League to resume their seasons online on March 21 following a one-week break.
"The online-only format should help mitigate schedule disruptions and overall viewership growth should remain robust given the primarily digital native audience," said Suthan Sukumar, the principal technology researcher at Eight Capital. "Further, game publishers should benefit from tailwinds with the stay-at-home dynamic and resulting shift in consumer consumption/spend on gaming content, particularly those with Asian market exposure, like Activision."
Not every esport will be able to make the swap to online-only broadcasts immediately and there are some disadvantages that come with organizing matches online. Teams will have to ensure competitive integrity for the players by avoiding networking issues, attacks from hackers, or other problems with technology. Having teams provide their own equipment and play in separate locations also creates more opportunities for cheating. Playing matches across different regions requires a production style. Finally, the broadcast talent will have to generate compelling storylines and excitement without a live audience providing energy and feedback.
Regardless of how well the rescheduled broadcasts perform, esports won't be satisfied being an online-only product. Activision said that despite the decision to restructure the Overwatch and Call of Duty League schedules for online matches for the foreseeable future, it plans to resume hosting live events when the pandemic is no longer a threat to public safety.
"We plan to return to team-hosted homestand competitions in front of live audiences as soon as it is safe and logistically possible," the Overwatch League said in a statement.
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