By Per-Arne Lundberg, Senior Wallenberg Fellow at Nordic Innovation House
Nordic Innovation House gathered up at K&L Gates San Francisco office for our annual #NordicMade GDC Breakfast, on Tuesday, February 28th. The topic this time was E-sport and the lineup was amazing, both from the audience and panelist. Over 120 people, not counting the panelist had registered to take part in the breakfast.
E-sport is not just showing signs of a global mainstream market, it is growing uncontrolled. Media rights for broadcasting the sport are projected to 7-fold within 4 years. Non-endemic brands like Nike, Under Armour, and Adidas are signing sponsorships with teams, leagues and events.
All these signals are showing that we are in for a disruptive moment. Traditionally the normal viewer of sports is considered to be a formal practitioner of the sport itself. This won't be the future. Now we will see more people than ever both engaged in spectating as well as active practitioners. Studies have shown that more than 60% of the spectators are active players themselves. This is way higher than for the average sport spectator. In addition, there are trends like Paris SG and Dallas Cowboys moving in and acquiring their own teams in the household E-sports names like League of Legends (LoL) and Defense of the Ancient (DOTA).
Asia being the biggest player in E-sport isn't actually a shock to anyone. E-sport has been relevant industry for well over 10 years in Asia, but it is interesting to see that this will shift when it comes to revenue. The US is estimated to be the largest monetary market - still outperformed by Asia in headcount of course.
With this back drop, Patrick Walker from Eedar entered the scene with absolutely latest data from VR / AR and E-sport. Besides the usual run downs in numbers, Eedar also confirmed that VR didn't take off in 2016 and the projections for 2017 are probably still too high, waiting for that killer app to boost the hardware sales. As a side note, less than 30 VR games on Steam has generated more than 250K USD in revenue!
Veli-Pekka Piirainen and Juri Juskevits from Critical Force gave us a good overview on the industry focusing on their awesome growth and scaling, with the closing quote on E-sport: “It will be huge”!
Tom Giardino and Erik Peterson from Valve held a discussion on their new Steam Direct-service. They have an interesting idea of letting game developers “buy” a timeslot that will guarantee a release. The flipside of this is that for quite a big audience the threshold to afford this slot might be too high. As a consequence, we will most likely see less games published on Steam. Is it good or bad? In my opinion, it could be bad for the early independent game developers out there, and maybe good for the some that can afford it. Steam has never considered having too many games in the store a bad thing. Or as Tom said it: “You’ve never heard of a library that has too many books - have you?”
A closing panel with Tim Ebner from Supercell, Heini Vesander from Super Evil Megacorp, Rickard Frisegård from Stunlock Studios, Siw A. Hødnebø Espeland from Encircle Games and Patrik Nybladh from Gumbler talked enthusiastically about the challenges and upsides on E-sport. All of course convinced that E-sport will conquer the world. The entire panel shared the belief that the challenges for any E-sport startup is the same as for any game startup. It is a game about customer acquisition, customer retention and monetization.