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Activision Blizzard's $46 million pipedream of shade
by Brian Bell on 01/13/16 12:47:00 pm   Featured Blogs

The following blog post, unless otherwise noted, was written by a member of Gamasutra’s community.
The thoughts and opinions expressed are those of the writer and not Gamasutra or its parent company.

 

I believe it is safe to say that the past calendar year has produced some of the most unthinkable, remarkable, and somewhat idiotic news blurbs that the video game industry has seen. From the ever-expanding scope of Star Citizen (I still haven’t forgotten about you…) to the summer of Rocket League to the year-long tire fire that was Konami’s games division, 2015 brought a plethora of forehead slaps and jubilant screams. In all the kerfuffle of the Skyrim mod rage and Fallout fervor, the gaming community saw a new form of validation in a way that more than likely no one saw coming: a video game championship was held on national cable television.

Yes, ESPN did in fact broadcast Riot’s 2015 League of Legends championship (better known as LCS) this year, and while it didn’t light a fire under the normal ESPN audience, it did show that the emerging world of esports was beginning to reach a different level. While those of us who annually tune in to such events as Evo or The International through an ever-sophisticating internet live stream process, the esports coverage net began to branch out as other media companies became aware of their relevancy in modern entertainment. While this olive branch of credibility was extended, there is still a ways to go in terms of implementation. It is my belief that live video gaming competitions don’t necessarily need the stamp of approval from television providers simply because the internet has already began surpassing them as relevant content providers. Think of how many people cut the cord on their cable box in the past year in favor of streaming services and devices that cater much more heavily to their interests and wallets. It’s safe to say that a move from streaming to over the air broadcast is not needed. That being said, though, there is a rising demand for better, more fluid and easy to follow broadcasts of these competitions if they desire to grow their audience. I’ve played a decent amount of DOTA 2 and even I find myself at a loss when trying to follow matches during The International. It’s as if a network needs to be created in order to both educate viewers on what to watch for in competitions as well as feature those competitions in some form of media hub that becomes the go-to destination for coverage of competitive gaming… an “ESPN of esports”, if you will.

Enter Activision Blizzard.

Leave it to the company who’s pioneering of the annual franchise model to create such bombastic and stupefying ripples within the gaming community only a few days into the new year. On January 5th, word came across the wire that Activision Blizzard acquired the majority of esports pioneer Major League Gaming for the paltry sum of $46 million. Now, while that is a monumental amount of money to you and I and our sub-$1000 account balances, that is a drop in an oil drum comparatively for Activision Blizzard. Just compare it to the close to $6 billion (with a big ol’ B) they poured into a bathtub for the sole purpose of having King, makers of Candy Crush Saga (that game is literally none of those things), writhe around in it. They basically paid the equivalent of a McChicken for the company that initially put esports on the map. The reason why they got such a great deal is because the esports market has not been kind to the people over at MLG in the past few years.

MLG was started as the first bastion of esports back in 2003. Ah, yes, 2003. When the mesa of gaming sport was dominated by Counter Strike, Halo, and some mech game I never played because I never had a PC enough well-equipped to get it running. Those were the days. Simple kill counts were all you needed to keep track of, and the StarCraft circuit kept to itself in Korea. I’m just kidding, all. I think it’s fairly safe to say that first-person shooters are the most boring thing to watch at a competitive level, and I have nothing against StarCraft or its fine players. Regardless of my feelings, MLG carved out a little niche and rose to some level of prominence amongst game enthusiasts and even began getting some television coverage on the now defunct G4 network. As the years rolled on, though, other companies began to take notice of what the start-up was doing and, instead of licensing their games to MLG for broadcast, chose to host their own esports events. Thus began the great splintering of esports coverage that we find ourselves in at present day. A splintering that ultimately led to the irrelevance of MLG and its eventual sale a few days ago.

The sale itself has a few mucky details that could easily leave a bad taste in your mouth. The deal was made without the usual unanimous decision needed from all MLG stockholders, but was approved by a select group of investors; most notably an investment group headed up by MLG’s co-founder Mike Sepso. Funny thing, though: Sepso recently left MLG to take a position with Activision Blizzard. The most of the small amount of money needed to complete the purchase will reportedly go to cover MLG’s numerous debts as opposed to its investors, meaning that MLG stockholders will get hardly any return on investment. Now, it’s easy to say that Sepso could have affected the amount of money that went toward the sale, but there isn’t enough information available currently to link the two together. It doesn’t make it taste any less like charred popcorn though. To quote one anonymous MLG stockholder, “I got fucked on stock.” Hopefully more information will seep out in the coming months, but don’t hold your breath.

Beyond the shady business aspect of the deal is the reasoning behind it. Remember that “ESPN of esports” statement I made from earlier? I’m not the first person to say that. That honor goes to the CEO of Activision Blizzard, Bobby Kotick. The purchase of MLG is undoubtedly fueled by Kotick’s desire to become exactly what MLG wanted to be: THE place for esports coverage. The company went so far as to hire former ESPN president Steve Bornstein when they announced the creation of their rather secretive esports division in October 2015. The deal for MLG gives the impression that they are building something massive that they plan on unleashing on the esports universe in the near future. At least that’s what they want it to purport. In reality, they bought a bunch of equipment, licenses, and possibly some employees to absorb into their esports division that would currently be headlined by the Call of Duty championships. Has your needle moved yet?

Kotick’s desire to establish the preeminent network for esports coverage was a pipedream from the first thought. Not because they don’t have the means, funds, or, now, infrastructure to produce such a network, but because they don’t have the ability to broadcast the games that the community wants to watch. And they are not going to gain the ability to broadcast those games any time soon. To think that they would be able to pry the rights to beasts of the scene such as DOTA 2 and League of Legends away from their parent companies after they have both clearly established their foothold in esports coverage is an exercise in denial. Even if they throw enough money to bring coverage of Evo, the world’s cream of fighting game tournaments, to their new network, the community that follows Evo would be damned if their gathering fell under the umbrella of a company with the reputation the Activision Blizzard holds. Even the Blizzard half of Activision doesn’t need to exist under Kotick’s master plan because their own esports coverage of their own games (StarCraft, Hearthstone, Heroes of the Storm) doesn’t need the boost of a former ESPN president to generate a fervent following. The Blizzard games will undoubtedly transition to this new network once it launches, but all that means is that Activision Blizzard will have access to titles they already own. Nothing changes. That doesn’t sound like ESPN. That sounds like a regional Fox Sports affiliate.

As long as publishers and developers hold onto their IPs for broadcasting purposes, there will never be a central hub for gamers to watch their favorite games played at the highest level. The funny truth about that fact is that there really isn’t anything wrong with that. Instead of focusing on building an uber-network specifically for esports, Activision Blizzard, as well as every other major esports broadcaster, should work to better iterate on the broadcast strategies and streamline their presentation models in order to accommodate a growing audience. It’s not rocket science. Build a better spectator mode. Improve the foundation of your streaming programs. Educate new fans in ways that make the experience of watching something as esoteric as a match of DOTA 2 exciting. Notice that none of these things involve throwing a spaceship full of money at a floundering league that will not end up helping you achieve your pipedream. That’s because some people work in knowledge, and some people work in hyperbole.


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