New eSports Business Model: Franchising

Very interesting analysis, via Bryce Blum of ESG Law: “The esports industry is about to, very quickly, get its first franchised leagues. This will bolster investments in each game and help promote the long-term viability of both League of Legends and Overwatch as spectator sports. The devil is undoubtedly in the details, and precise deal terms are still subject to negotiations, but major figures from the world of traditional sports, media, and entertainment will feature prominently in the inaugural ownership groups. Current esports team owners or investors already include the likes of Peter Guber (co-owner of the Golden State Warriors and Los Angeles Dodgers), the Philadelphia 76ers, Shaquille O’Neal, FC Schalke 04, The Boston Celtics’ forward Jonas Jerebko, and many, many more, with others poised to enter the fray.”

“The esports market is young (55% of fans are between 21-35), valuable (average household income of $76,000), and experiencing explosive growth throughout the west (the number of US esports fans grew 76% last year). Meanwhile, from 2004 to 2014, the median age of a MLB fan skyrocketed from 46 to 53 and the median age of an NFL fan rose from 43 to 47.”

“In a world where younger generations are “gamified since birth” and no longer consume media in the same way, they are also increasingly less interested in many traditional sports products. Esports stand apart as a uniquely engaging and therefore valuable form of content. It’s also intrinsically entertaining — 42% of esports viewers don’t even play the game they’re watching.”

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