This week the ‘eSports IQ by Alex Fletcher‘ features the following content: Economics for eSports player unions still missing

Economics for eSports player unions still missing

News that World of Tanks creator, Wargaming, is contemplating creation of an eSports players union, highlights the contour of issues represented by professional competitive scenes. The professionalization of eSports has spurred a rapid convergence with traditional sport structures, in ways that are blurring areas of interest for video game publishers. In Wargaming’s case, the company seems to recognize the need for an organization run solely for the benefit of, and by, professional eSports players. However, there is a glaring lack of supporting infrastructure in the world of eSports which hampers development of items like a players union. Specifically, eSports is not yet a stable business for the vast majority of industry participants.

For all the overall growth of the global eSports industry, there is little consensus on viable business models that uphold it. Professional sport is built around the stability of its enterprises, e.g. the ability of teams, leagues, etc. to generate revenue and turn a profit; then effectively share the wealth across an array of participants. Electronic sport has yet to evolve channels which redirect its massive appeal into widespread financial returns, let alone distribute revenues in an equitable degree. With this in mind, the journey towards unionized player organizations requires more general industry maturity. For example, despite impressive overall, viewership numbers and eye-catching prize pools, competitive video game segments are still heavily dependent on sponsorship revenue. Yet, most teams are not organizationally mature enough, as marketing vehicles, to sustain the types of partnerships.

With competitive scenes still too top heavy, e.g. established teams amassing the lion share of sponsorship revenue, the related imbalances remain primarily structural. Wargaming’s proposal to build a players union is complicated, first and foremost, by this fact. The recent Twitch and FACEIT partnership, to create a Counter Strike eSports league, explicitly addressed revenue sharing for a reason: Financial stability is the precursor for enabling the evolution of player empowerment. Higher median thresholds for team and player stability will spur organization, not the other way around. A better, more reasonable approach for Wargaming could be to roll out a full suite of wellness services for players. With injuries in eSports emerging as a prevalent concern, investing in the health of pro players doesn’t sound as glamorous as a union, but is more immediately pertinent.

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The ‘eSports IQ’ is compiled by Alex Fletcher, the founder and president of Entiva Group, LLC, and features insights on the latest emerging trends in eSports. By curating invaluable content from a wide range of information sources you get the leading edge in the business of eSports. The complicated past (and future) of esports on TV

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