Some famous e-sports organizations face a decrease in viewing time and cannot make a profit, dismissing staff, ending contracts with star players, selling teams in the red, etc., and the future of the industry as a whole is feared found out
With the Olympic eSports series starting on March 1, 2023, eSports is showing excitement, but in the face of a decrease in viewing time, it is forced to dismiss staff and terminate contracts with star players. It is reported that there are also sports groups.
The E-Sports World's Future Is Uncertain as Growth Stalls - The New York Times
Reported offers for TSM's LCS slot fall well short of league's record sale price - Dot Esports
According to estimates by Esports Charts, a data company specializing in esports , the league championship (LCS) series, the largest esports league in the United States, recorded a total of 14.8 million hours of viewing time in the spring season of 2023. This was a 13% decrease from the previous year and a 32% decrease from 2021.
Gaming and esports analyst Rod Breslau told The New York Times, ``I think it's time for everyone to ask themselves what they should be doing. And the actual value was too low,' he commented.
The esports industry has so far attracted huge sums of money from many investors, and top esports players have been earning annual salaries comparable to traditional sports players, but the enthusiasm for esports is waning. We are at a crossroads in the middle.
For example, some esports teams like Evil Geniuses have parted ways with many of the highly paid League of Legends players, while others like 100 Thieves are laying off employees and senior executives. In addition, the e-sports organization FaZe Clan, which became a listed company in 2022, was once traded at more than $ 20 (about 2700 yen), but at the time of writing the article, the stock price dropped to around 50 cents (about 68 yen). In response to a notice from Nasdaq that the stock price would be delisted if it did not recover to the $1 level, the company announced that it would lay off 40% of its employees.
In addition, Jack Etien, CEO of the esports organization Cloud 9, said he would withdraw from nearly half of the esports leagues his organization participates in, reducing costs by reducing the number of leagues from about 15 to eight. increase.
In addition, Team SoloMid (TSM), one of the esports organizations with the highest market capitalization, announced on May 20, 2023 that it will sell its LCS series slots. TSM is one of the oldest and best-known brands in the North American esports industry, and The New York Times said, 'It's like the departure of a major franchise from the NBA or the NFL, and it's a big blow to the league.' I'm here.
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TSM has set an asking price of around $20 million (approximately 2.7 billion yen) and has begun discussions with groups interested in the transaction about three weeks before the announcement. The company has narrowed down the potential buyers to about 12 companies.
TSM, like other organizations, pays a flat $10 million (approximately $1.37 billion) purchase fee for LSC slots. Therefore, the price of $ 20 million is double that, but ``it is quite low compared to the market price of LCS slots traded in 2019,'' pointed out esports media Dot Esports. .
Andy Ding, CEO of TSM, explains that the withdrawal from the American league is not a financial issue, but a player's desire to participate in the world championship. Most of League of Legends' best teams come from South Korea and China, and the North American region has long lagged behind them in terms of competitiveness. As such, Ding said he plans to buy slots in other regions after selling slots in the United States.
John Needham, vice president of esports at Riot Games, which runs the LCS, acknowledged that the esports industry has problems, saying, 'Most of what we sell is a dream, and the long-term future of esports. And when we lose a team and can't invest in that dream, we see that as a failure, so we certainly feel the pressure.'
On the other hand, there are also movements that see the withdrawal of TSM, a big name in the industry, as an opportunity. Andy Miller, chairman of the esports organization NRG Esports, said, 'It's a tough time, but it's also our time. It's an opportunity to steal a lot of existing fans.'
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