Although eSports is still years away from becoming an indelible part of pop culture, professional gaming has grown exponentially over the past two years. The advent of streaming technology has helped the Major League Gaming (MLG) organization broadcast live matches of games like Starcraft II or League of Legends and connect with gamers around the globe; Over 15 million hours of streaming video were consumed by gamers during Pro Circuit weekends last year and viewers from 175 countries tuned in to the final tournament last November in Providence, Rhode Island.
MLG co-founder and CEO Sundance DiGiovanni is riding this success into a new year and changing up the format of the new season with four shorter championships and more events. MLG is also introducing Arena events, where the best StarCraft II gamers from around the world will be flown to New York City to compete live in front of a small audience. This is in addition to four main Championship events, the first of which kicks off this March in Columbus, Ohio. In this exclusive interview, DiGiovanni talks about the business of eSports and how he hopes pro gaming will expand in the coming years.
What are the challenges of remaining profitable in eSports?
At MLG our goal is to continue to be the best at what we do – deliver the ultimate competitive platform for gamers around the world and entertain spectators. In order to remain profitable, it’s key to find the right balance between rewarding players for their performance, embracing new technology like streaming and being able to offset costs with partnerships/sponsorships and fair prices for spectators. At the end of the day it's our responsibility as a business to balance our costs against the revenues that we're able to generate.
How has MLG been able to weather the economic hard times over the past few years that have hurt many in the videogame industry?
Since our inception, MLG has grown in conjunction with the ever-evolving technology and video game industry. MLG has been able to fare well, while others in the space have struggled, by partnering with some of the world’s most renowned brands and quickly embracing new distribution models and formats. By staying on top of new platforms like Web-based streaming, we have been able to deliver a superior product that fits the media consumption habits of our audience. Our position as a world-class organization that innovates rather than imitates is what attracts our partners and sponsors.
What impact has last year’s success had on prize money and the capability of pro gamers to actually make a living off of eSports?
We’re still not necessarily where any of us would like to be on that, but you’ll see our prize money is going up significantly. We’ve got this arena for $26,000. We’ve got our Pro Circuit, where you’re going to see stronger prize money there, as well. The key to it is that you have to understand; most players aren’t going to make their living through prize money. There are a select few who actually will play for the money. The idea is that there’s enough of an ecosystem within the eSports universe for people to make money off of streaming, lessons, and endorsements. I think you’ll see more and more of that, which I think is a good thing.
What would you like to see happen for pro gamers moving forward?
Our goal is to get to a place where 100 players, as a rough number, are making a living within our confines. I think it’s going to be a little while before we’re to that number, but every month we seem to see new advances, new brands getting involved, and new opportunities for players to make money. We’re not quite at that point where I think everybody can raise their hand and say, “Yes, there really is a strong market for players to go pro,” but I keep seeing players getting new deals, new players getting signed, and transfers between teams. It’s definitely grown a lot in the last two years. I think that this next year you’re going to see even more advancement on the player side.
What do you think the next step is going to be in order for pro-gaming to become more mainstream? Do you see a day where ESPN covers pro gaming like they cover MMA or poker these days?
If you ask any hardcore MMA or poker fan, I don’t think ESPN is the first place they go for their news. I think it’s an interesting place to go to see the broader point of view. I think within gaming, what we have to do is keep in mind that these outlets are only going to be effective for us once we get to a point where there’s a broader audience base. We’re not trying to convert the map that currently exists, we’re trying to create something so that the next generation of 12-year-old kids who are now 10 grow into it in two years. I think you’ll see that exponential growth over time.
What role do you see the streaming and videos you’ve been recording since the beginning playing in eSports?
Having it set up in a way which the history is recorded, and you can point back to it and say, “Here’s why Bomber’s fantastic,” or “Huff is such a great guy.” When you have that history documented, you can go and see yourself one day looking on ESPN and seeing them talk about classic MLG matches, because we’ve done a good of documenting our events, who the winners and losers are, and all the stories. We’re not forcing anything at the moment; we’re just letting it happen. We’ve got a lot of conversations going on with traditional media outlets, but the reality of it is that we’re going to do what we do best. We’re going to focus on the competition. Whoever wants to cover us can, and we’ll provide them with all the information they need. I think if you make a quality product, enough people show up where eventually it can’t be ignored. That’s literally what happened with poker, and what happened with MMA with the UFC. We’ll embrace that when the time’s right, but there’s no reason to rush towards that.
Did you look at what Korea has done with StarCraft II when creating the new season?
Yeah. I think the thing for us is that we want to be recognized as a global league. That’s why we’re reaching out and flying in the top eight performers from all the Battle.net regions. The idea is that we want whoever wins one of our events to truly be able to say that they’re the best in the world. What we’ve seen in Korea is fantastic. There’s a lot of history in Europe with the teams that are there. We’re just trying to take and learn from everything that happened previously in the space and try to offer the best entertainment product possible. We want out events to be the ones that players look at and say, “That’s the one you really want to win.” We’re definitely going with this focus of global interaction, pulling these players in, and paying for travel as a way to eliminate the question mark for teams, managers, or players of whether or not it’s worth their while. I think that’s going to help bring in a lot of international talent. I think it’s going to also help us find a lot of new players who maybe are out there and are incredibly talented, but never had the resources to make it to an event.
What role will streaming play in 2012 following the explosion we saw last season?
Streaming, obviously, is where it’s at for us. We’re going to do more there. We have more plans for the streaming product we’re going to be offering. We have several partnerships that are in the works right now with folks to help enhance the experience and also get us better distribution then we had last year, even though we already hit 175 countries, so we’re doing pretty well there. Our focus is to stream the competition live, as it happens. We see a tremendous amount of opportunity based on the success we had last year. The level of interest from potential partners is basically through the roof. We have people approaching us asking for our content.