I’m going to take an unpopular opinion here. I’m expecting some backlash.
I don’t care.
The decision that MLG made in pricing its Winter Arena event as a pay-per-view event is brilliant. I think it is necessary. I applaud the bravery of MLG in making this move and taking the risk for every tournament organizer and content producer out there. And this article is my attempt to convince you of the same.
In the past few weeks, we’ve learned from the horse’s mouth that no tournament is making any money. Those of us with some background in business have had this suspicion for some time. Anyone who has run an online event knows this. But it’s out in the open now.
This much is indisputable: if a profit cannot be made, this industry will collapse. We’re teetering on the edge right now.
In general, StarCraft II fans have been extremely spoiled in the past year:
- You’ve had access to more content than you can possibly consume, all of it with a free option.
- You have an incredible amount of say in what you get. You want better players? MLG flies in Koreans. You want bigger prize pools? IPL3 makes it happen. You want your favorite casters? Nobody bothers having an event without Day[9], Tastosis, or Bitterdam casting.
- A significant portion of you use AdBlock, depriving many events of any advertising revenue from streaming.
At the same time, the competitive StarCraft II fan base is incredibly loyal and passionate. They are extremely opinionated and will seemingly switch from praising to crushing a community personality every week, but overall the fan base is energized and is enthralled with competitive StarCraft II.
The Problem with Free Content
Here’s the big problem: the fan base is not growing fast enough. MLG, IEM, Dreamhack, IPL - they’ll all release press releases talking about how many stream views, uniques, concurrent viewers they had. Earth shattering numbers, they’ll say. Incredible growth, they’ll say.
It’s bullshit, and they know it. You say that because it gets attention from the right people, and because it’s the truth. But the reality of the matter is that the number of people watching tournaments hasn’t really increased much from early 2011 or even late 2010. Many were hoping for 300-500% growth. Depending on whose numbers you are looking at, the fan base grew somewhere between 20-50% last year.
That’s not enough. Mainstream advertisers are not rarely seen because we don’t provide the right demographics - you’ve likely heard hundreds of times that the 18-35 male demographic that eSports caters to is the hardest demographic to reach and demands a premium. That’s completely true. However, it is a hard sell to pitch your 150,000 viewers as a valuable commodity. It’s just not enough.
It’s like trying to sell one loaf of bread to a busy restaurant. They may see the bread and say, “Wow, this bread is great! Can you bring us fifty loaves every day? That’s what we need.”
“No,” you say. “I just have this one loaf.”
That’s the value proposition for eSports right now. We have a valuable product for advertisers, we just don’t have enough of it to even matter. Econ majors will look at this say, “Ah, classic supply/demand! With supply so limited, you’ll be able to charge an incredible premium!”
Business people will look at it and say, “Your supply is so limited you are meaningless. You are irrelevant.”
There’s still a chance to continue growing as a fan base. It’s going to take a lot of work from everyone in the community - fans need to get their friends interested, developers need to make their games more spectator friendly, tournaments need to work more with the gaming media and work to convert fans of one game to fans of multiple games, players and personalities need to put forth their best effort every day.
But the event production industry cannot wait for another 10 years of 20-50% growth. Nobody will be left.
Enter Alternative Revenue Models
In the aftermath of MLG’s announcement, two trains of thought came up in the community again and again:
“Assembly has to be celebrating, as a free to watch event they are going to have so many more viewers.” “The GSL just started looking a lot more valuable, you get so much more for the same price.”
You are right. Assembly, GSL, IPL, IEM - all of them are thrilled with MLG’s announcement. Some part of it is probably that a “competitor” may have shot itself in the foot a little bit. Most of it is because MLG has some balls.
The Winter Arena could be an incredible failure on the part of MLG. They could sell zero passes and broadcast an event to nobody. No matter how many passes they sell, they still have to fly out players, pay out prize money, pay for the production staff, streaming, etc.
It could also be a huge success. Let’s do a little math right now, assuming MLG Winter Arena was completely free to watch.
Average concurrent viewers: 100,000
Average CPM for an ad: $2
Number of commercials aired per hour: 8
Hours broadcasting: 30
Percentage of people using AdBlock: 0%
We take 100,000 / 1,000 to find there are 100 “M’s” in the CPM (Cost per Milla, or 1,000 impressions.)
We take 100 and multiple it by $2, which gives us $200 earned on average when a commercial airs. We have 8 commercials an hour, so that’s $1600 an hour. Now with 30 hours, that ends up at $48,000 in ad revenue.
This is an extremely high estimate of what could be earned, because it’s not reality. Reality is that a portion of those viewers will be from regions where you cannot fill an ad, so they don’t earn you any revenue. Reality is that 0% of people using AdBlock hasn’t been true since 1997. But let’s say it’s true.
So if they aired it for free, they would have $48,000 in revenue. At their price of $20 for a pass, they need to sell 2,400 passes to equal that revenue.
That basically means if more than 2.4% of the people that would have watched the event if it was free end up buying a pass, they generate more revenue. MLG is making a bet that this could happen.
But what about event sponsorships? They will still have them. Maybe they’ll get paid less for them, but you’ll still see that revenue. I consider that moot - plus if event sponsorships were so lucrative for tournaments, we wouldn’t be looking at MLG trying other revenue models.
If they succeed - they will prove that the market is willing to bear a premium for premium content.
If they fail - they will prove that the market is NOT willing to bear a premium for premium content, and tournaments can look to make a profit by other means.
What other means? Well, they can cut costs for one (scary for a fan, but would you rather have no tournaments at all, or not see Day[9] and 30 Koreans + Europeans at every North American event?)
How MLG’s Success Would NOT be the End of Free Content
There is a ridiculous amount of saturation in the market. Everyone that isn’t a major tournament is getting viewer numbers significantly less than the feel they deserve. Typically they are right.
On top of that, every tournament needs to have some sort of hook in order to draw viewers. You need a premium caster or a premium player. Occasionally you can pull one in without spending a large sum of money, but typically you need to have a significant prize pool or compensation package to bring one in. This goes back to StarCraft II fans being a bit spoiled in 2011 - if it isn’t Idra, Huk, WhiteRa, Destiny or a member of Team Liquid playing - you don’t watch. Unless there is a major caster involved, of course.
If some content producers go the premium or pay-per-view route, there will be less supply of free content available. This will mean more viewers for those free to watch events, which will mean more ad revenue, which will mean an opportunity to make a return on investment.
It will also expose viewers to a bigger variety of players and casters, something many in the scene think is necessary for the continued growth of competitive StarCraft II. If Idra only wants to play in large prize pool tournaments (that are more likely to be PPV) - great! The free to watch streams will expose you to the next Idra, or someone just as good as him who doesn’t have as much attention.
So, Should You Buy the Pass or Not?
My recommendation after all that - do whatever you want. If you think it’s worth $20 to you, buy it. If you don’t think it’s worth $20, don’t buy it. The beauty of this is that whether is succeeds or fails, it’s good for eSports. Obviously MLG would prefer that it succeeds, and teams are hoping people buy passes so more people see their players and sponsors, but the reality is that just answering the question “Will people pay a premium for premium content?” is going to be great.
Feel free to criticize how MLG has handled this. Feel free to support other events if you want.
But don’t think the model of 2011 is coming back. The eSports dollars are not infinite. Charity on the part of individual fans, investors, or sponsors cannot sustain this industry. We need to see if this works.
Written by:
Alessandro "airety" Minnocci
WellPlayed Chief Marketing Officer.
Do you want to have your voice heard in the esports community? WellPlayed is looking for skilled and motivated SC2 and LoL aficionados to join its staff of volunteer writers! If interested, please send a personal statement (including ideas for content) and a writing sample to contact@wellplayed.org.
It may not be the right model, but I'm sure you are glad they are trying it vs. you trying it and finding out it doesn't work :)
1What do mean MLG Has lack of other content???
They are going to have a stream dedicated to interviews and other things and that is going to be free for all (although IMHO that should be part of the PPV Package)
MLG Has had the qualifiers to build up to the arena which people spoiled screwing their own entertainment. You cannot say there is no story going into the arena. As well, the arena IS the build up to the pro circuit event. You are paying money to watch an awesome tournament that is going to give seeds to what is happening later on.
Please get your facts straight people.
0If this kind of system is what the industry needs, then fine. My problem with it is how they basically shafted people who bought a gold pass. I bought it with the full expectation that for the next year, I would get free HQ streams for all of the Pro Circuit events. The Winter Arena is a part of the Pro Circuit both by what they have said, and by the huge graphics that say so all over the sight. MLG mislead us and because of that, I won't be renewing my subscription or buying any passes for Arena events.
I hope they continue to produce good content and I hope that they rethink the benefits for gold members, since 2012 reduced what gold members get, after they had encouraged everyone to buy a gold pass.
3Alessandro,
As an SC2 spectator from Costa Rica - a country with no Starcraft tournaments whatsoever - I assure you this: I paid the annual ticket for GSL 2012, and I will gladly pay any MLG tickets required to watch my favorite players perform on stage this year.
Much respect to MLG and Sundance DiGiovanni for taking this step...
2You are forgetting the teams; I am sure every team sending players to the event is not too happy (unless they knew ahead of time). A team needs to show "how many people saw this player of theirs compete in a tournament" or "how many watched him win/take 2nd/3rd place at this tournament" when they report to their sponsors, and ask for more sponsor money. So if 2.4k see the event with passes they will be ashamed to talk about that tournament to their sponsors. Of course you might say: I am not counting fame from the reports that the player will get, but I doubt a team can count those precisely enough, or if they are relevant to a sponsor. I am not sure if you remember MLG reverting their decision on the team T-shirts, and the logos on the T-shirts because the teams reminded them that "hey we need money from our sponsors as well.
Also you 2$ CPM is low for an organisation like MLG, own3d has 3$ CPM for just regular partner streamers. What I mean is even with own3d getting a share of revenue they can afford 3$ per CPM--MLG has no middle man in many of their deals so the CPM for them is higher I am sure (Google takes 49% of add revenue, I am sure own3d takes as much or maybe more).
Anyway, bottom line is that you can't think of just the tournaments, you need to think of the teams as well.
2MLG payed for every single expense any team would've had. All they took from their players was a weekend. If an American rep tell you that you need to do nothing and he will fly your player(s), give him a lot of exposure and press, and a chance to win money for you, I don't think you would say no. Plus even if the viewer base is low the Winter Arena has more than enough buzz to go about, specially since their partnership with GameSpot.
1MLG payed for every single expense any team would've had. All they took from their players was a weekend. If an American rep tell you that you need to do nothing and he will fly your player(s), give him a lot of exposure and press, and a chance to win money for you, I don't think you would say no. Plus even if the viewer base is low the Winter Arena has more than enough buzz to go about, specially since their partnership with GameSpot.
1I was actually hoping for something more along the lines of GSL. I'm less inclined to pay $20 for a 3 day tournament, but interested in paying a higher price for a month or two of content, like $60 for a month or two of tons of matches. To each his own I suppose, everyone's got an internal value they put on these things.
I'll be buying it. I want to be a part of the experiment, if nothing else.
2MLG would be incapable of running something along the lines of the GSL model because its players are spread across the world. The GSL is fortunate that they have a centralized player base. The only way to pull off what you are suggesting is to cast from replays and that will take away from some of their appeal. MLG seems to have taken notice to how successful Homestory Cup was and is trying to pull that type of tournament off.
I agree that $20 might be a little steep and I personally would have preferred some sort of package that includes all the arenas and championship tournaments but until we see how it goes we really cannot put an accurate price on it.
2Experimentation is a good thing. That said, there were a few points in this article I disagree with:
if a profit cannot be made, this industry will collapse. We’re teetering on the edge right now.
Competitive gaming has gone on for a long time. A broader, long-term view is not just about profit.
the fan base is not growing fast enough... the event production industry cannot wait for another 10 years of 20-50% growth. Nobody will be left.
If everyone shared a profit-driven, short-term, gloom and doom mindset, then we would be in trouble. Fortunately this is not the case.
If some content producers go the premium or pay-per-view route, there will be less supply of free content available. This will mean more viewers for those free to watch events
Just get as many as we can on one channel? The narrative seems backwards to me - we should start with the people!
2I agree with Lux here...this is moving things backwards.
PPV events is not a long-term solution, it's a gut reaction to unrealized growth. These leagues aren't going to survive by closing themselves off to the Internet masses, nor are they going to grow their audiences by making the entry hurdles even larger.
Regardless of whether you like American Football or not, it's not a stretch to say that as a professional sports league they are the G.O.A.T. Following Boxing's model: sell the individuals instead of the sport is good for spike's hear and there, but it's clearly inferior.
The problem I see is that MLG has no clue on how to package their product. Football made something, "Any Given Sunday" and sold it to the masses. The game is the game, which they go through great lengths to keep unpredictable and exciting. However their product is a day where you and everyone else has a chance to be a winner just by staying tuned and connecting to the game somehow. This is where the profit comes in - venue sales, merchandising, TV licenses, brand licensing.
The objective should not be to make your viewers pay to watch your event. The objective should be to get business to pay to be affiliated with your event(s) and have access to your customers.
0always sucks to pay for things but man... for the growth of esports! we all want esports to be everything we have dreamed of it to be. its scale! its excitement! this is one of the steps that will need to be taken. im glad that MLG is doing this. its time to take it to the next level. :)
1This article has missed the key point. Its not the fact that its PPV that's the issue. Consider the GSL, even though they have a free stream, for most foreign viewers its only a viable option if you buy the premium package.
The problem is that MLG's production quality is not worth the $20 they've priced it at.
For 20 dollars a month, I can get all the GSL/GSTL matches and extra tournaments in HD(ish) quality. The format is better, allows for higher quality play (players have time to prepare for matches), and the production quality is miles ahead.
In my opinion, MLG should move away from the weekend marathon circuit model because that is the bottleneck to their quality control, but if they don't, then they at least need to make an accurate pricing plan the reflects the quality of their content.
1You, as a consumer, are saying you don't believe the production value they'll provide is worth it. They are addressing that by allowing you to watch the first match for free.
If it's not good enough to you, you won't buy it. That's the way the market should work.
They are making a grand attempt to make the financials work. We'll see if it works out, but regardless every content producer in the world has learned a lot from the community because of this.
2But people ARE making it the issue that it's PPV. They have every right to charge. It's one thing to say it's not worth the $20. It's another to protest being charged and demanding it free while turning on ad blocker and crying for a larger prize pool. Let market forces sort it all out. Money doesn't grow on trees.
It should also be understood that a LARGE portion of the audience is 12-24 males... either too young to have money or in college and don't have enough. So I'm guessing this portion of the community doesn't understand the real world yet. Where money makes the world go 'round.
It's not a mistake to make 1 event PPV though. There are plenty other MLG events to watch for free. They aren't putting all their eggs in one basket. It's not the end of watching MLG for free.
1I definitely think PPV is a necessity in getting the industry into a financially stable place. However, the one question I do have regarding MLG's move is this: why have the arenas as PPV, but (from my understanding) state that there will be free stream for the championship? Shouldn't it be the other way around? Have free ad streams plus a cheaper ad-free PPV (maybe $5 or $10?) for the arenas, then a $20 PPV for championship or something.
With that kind of model, I feel you'll be more likely to entice people to accept PPV-only for the championship, as they'll (likely) become emotionally involved in watching how things turn out with their favourite players whom they've been following during the arenas. I think that's the kind of hype a lot of people are talking about is missing when deciding whether or not to dish out $20 for Winter Arena.
That's my only gripe though. Aside from that, it's a good move overall -- we've seen GSL have a subscription model to (seemingly) great success.
1Also i think this would promote more barcrafts because i know some people do not like the idea of paying now. Then their alternative is going to a barcraft for mlg which i think would be free minus drinks and food. This way mlg still gets profit while people can still view mlg for free(?) and gathers the community tighter and maybe even expanding the community at a faster pace than before.
1Interesting write-up and it's good to read an honest run-down of what organizers face.
I see two more threads about this in the community that I don't feel has been addressed sufficiently:
For one: A large part of the cost, and hence a large part of the PPV ticket, is paying for travel and accommodations. I can't help but ask a few questions about this:
(1) Isn't this a complete change from just about any other tournament? Did tournaments regularly pay for any player's travel and lodging? (2) Would it not make sense to offer only stipends, not full coverage of travel+lodging? A number of folks ask why it is that they get covered 100%; why aren't their teams picking up any of this?
The second thread: Why is there no live audience when this is apparently taking place in NYC? It's a better viewer experience to have fans cheering. Tickets would certainly help absorb some of the overall cost.
While I'm critical of the approach to this PPV event, I'm also thanking MLG for taking the step, starting the discussion, and throwing us all into a cold dose of reality. It looks like this needs to be put out in the open, and what better way to do it?
Personally, I wished for a softer approach, but that may not be realistic. I'm not an event organizer.
After the concession to Gold members, which I found to be important not in overall savings but in simple acknowledgement of those who do regularly pay for SC2 to flourish, I'm ready to pay for this event and see how it shakes out.
GLHF all.
1Personally, I think the "concession" to Gold members didn't make it any better. Maybe they had planned to do that the whole time, but I imagine they just put that out there to try and stop the backlash. As it stands, Gold members are still getting significantly less than what they reasonably expected for 2012.
1Well, I gotta give you props for voicing an unpopular opinion. But I wish you would support your argument with facts, instead of fear-mongering.
Some examples:
" if a profit cannot be made, this industry will collapse. We’re teetering on the edge right now." Where is your proof? One year ago all we had was MLG, IEM, Dreamhack, and GSL. Now we also have NASL, IPL, and TESL. No tournament organization has run out of business, and every tournament is posting growing viewers and prize pools. That doesn't sound like "teetering on the edge" at all.
"Here’s the big problem: the fan base is not growing fast enough. Many were hoping for 300-500% growth. Depending on whose numbers you are looking at, the fan base grew somewhere between 20-50% last year. That’s not enough." Again, where is your proof? I think 20-50% growth is MUCH healthier than 300-500% growth. I also think it's ridiculous that you're knocking 20-50% growth in an business industry during a global economic recession. Most businesses would kill for "only" 20-50% growth right now.
"So if they aired it for free, they would have $48,000 in revenue. At their price of $20 for a pass, they need to sell 2,400 passes to equal that revenue. That basically means if more than 2.4% of the people that would have watched the event if it was free end up buying a pass, they generate more revenue. MLG is making a bet that this could happen. But what about event sponsorships? They will still have them. Maybe they’ll get paid less for them, but you’ll still see that revenue. I consider that moot - plus if event sponsorships were so lucrative for tournaments, we wouldn’t be looking at MLG trying other revenue models."
You are forgetting so many things in this financial analysis.
MLG racks in a big chunk of their revenue from selling player+audiences at most MLG events. This event is a small invitational, so they are not charging for player passes, and this event does not have a crowd, so they are not charging audience. Most sports earn over 50% of their revenue from selling live event tickets, and esports is no different. MLG is making a conscience decision to sacrifice this portion of revenue.
MLG did not have any sponsership deals for this event. I think you had some bad information here. Sponsors are not going to be interested in an event that only has 2-3k eyeballs watching it.
Just because the community is opposed to exclusive PPV does not mean that the community is opposed to partial PPV. I would have have been perfectly happy with MLG if they made just 1 out of their 4 streams free to watch with ads + low resolution. I want MLG to offer less features for free at their open events, and offer more features for free at their arena events. This isn't about a sense of entitlement, it's about a concern for esports to grow. Exclusive events are not going to grow the existing fan base, they're only going to exhaust already-paying customers like me.
Interesting article, it's nice to hear someone sum it up intelligently. Especially since I haven't had the time to look into it. Personally I won't be buying the pass because 1. it's not worth it to me and 2. I think the PPV model is bad. I would much rather them increase the amount of annual memberships they sell.
I also wanted to mention that I created an eSports AdBlock list a little while ago. It's for all you eSports fans that want to support these websites. It's obviously missing some links, but I've been adding more here and there: http://www.spawnroom.com/tsr-adblock.txt
To add it, open your AdBlock options -> Filter List tab -> Filter Subscription drop-down -> and select "Add a different subscription". Title it what you want and enter the link. Its been working perfectly for me so far. If you have any sites you want added or discover a problem, let me know on Twitter @SpawnRoom or on the site forums.
0This comment has too many downvotes. Click to view.
That Giovani guy running the mlg show has no idea what he's doing. You can tell by just looking at him, he's all style with no substance. He's too worried about looking cool and hip then running a successful business model to make this industry a "here-to-stay" instead of a quick crash and burn with no looks of a revival in the future (in the west at least). The mans more concerned with his brand of fake and what he twits then finding new markets and keeping them. He should go back to mtz or whatever business his daddy will buy for him.
That being said, the ads online are complete bull shit. You will not make any sort of profit if you run ads. Especially if you offer free streams. Fucking amateaurs. You silly kids need to go back to your art class and let the adults do the thinking. You need to charge users but offer them flexible plans. Not everyone is going to want to pay premium and some just want to watch the livestreams for the weekend. Genni obviously doesn't know his demographics nor care to find out what they are.
SC2 could be such a beautiful beast but it needs to have it's own stage and not share it with trashy console shitheadss. Sorry, I just can't respect a gamer who's only talent is swiveling a little joystick and headshotting another player. No skill whatsoever.
That being said, my input is:
Follow the GOM model.
Or
Let MLG fail and be bought buy a man or a group of men who know wtf there doing. I would be interested to know what Gevanti would be willing to be paid to part ways with SC2. He doesn't deserve it gracing his shit tournaments.
Not everyone who plays this game is poor. If guinea is interested in selling, I'm interested in buying so sc2 can flourish the way it needs too. The man is just holding it back. Or he needs to surround himself with smarter people so shit like this can be easily avoided.
Hey jenni, if your reading this, please for the love of Zeratul give up sc2.
Very good article! I think that the math here is definitely correct.
The problem people are having with this is clear as well as justified - everyone says they want to support eSports, want it to grow, but the fact that this means moving away from the "enthusiast-charity" model towards being a real industry freaks people out and they are probably right about that.
From the point of view of someone who is planning to invest heavily into the BarCraft-side of things, I found the comment interesting that this may create more BarCrafts or help these grow. Because I for one felt a little less confident when reading this. Because the model moves away from regarding the number of people as the main commodity of success and towards output - how much revenue do these people generate (for the tourney itself, not for the i.e. barcraft-organizer).
Of course: The first step will be for BarCrafts to be a good model for the viewers.Right now, all the organizer needs is to buy that pass. But how long do you think this is going to last? The current model where streaming tournaments is basically free and you even get supported by free advertisement is probably not long for this world. Tournaments are going to realize that 200 people watching a ppv for the price of 1 is not what they want.
BarCraft is going to face the same problem as the tournaments themselves - It's fun, it's great, it's even profitable. But will this still be true once heavy licensing issues come into play? For those of us who are truly into the idea of growing eSports there is probably only one answer: We have to hope it will.
0I think it's important to note that the current model (that of offering a free stream to all tournaments) is because of Blizzard Entertainment's policy. If you read through the legal fine print, Blizzard clearly states that you MUST offer a free standard resolution stream of your tournament if you are streaming. Also, you (as a tournament organizer) are prohibited from charging participants of your physical event.
Obviously MGL is large enough that they can negotiate around these policies with Blizzard, but for the vast majority of organizations, it would be very difficult to get this sort of permission. Of course you could charge anyways and wait for Blizzard to come after you, but that's the same reason why Gretech (owner of gomtv) is the only company allowed to host StarCraft tournaments in Korea; everyone else abused the power to charge money for things that Blizzard did not condone, (back in BroodWar days)
I suppose my point is this: If the financial model of eSports needs to change to support sustainability, then Blizzard should make charging money for tournaments easier to do legally.
I would love to hear your thoughts : )
0I run GameReplays.org alongside a former director of AOL's European product strategy, and I have to say that the math used in this article is wrong. Not sure where the author got $2 CPM from, but pre-roll and mid-roll advertising pays between $20 and $30 CPM when you're talking the level of viewership that MLG generates.
So multiply that $48,000 by 10 to 15, and that's a more accurate best case scenario for revenue that can be obtained through advertising just in the videos alone, let alone the other ad units on the page.
The author is correct that not all regions will have good ad fill rates and of course there are people using ad blockers, but that doesn't change the fact that $48,000 as a best case scenario is incredibly under-estimated.
And while season passes might be a more reliable source of revenue anyway, it's sure as hell not going to help grow eSports. I'd hate to see eSports go the way of PPV boxing or UFC instead of sports like football, soccer, baseball etc. Talk about a great way to close it off to a lot of people with only passing interest.
0I agree with Lux here...this is moving things backwards.
PPV events is not a long-term solution, it's a gut reaction to unrealized growth. These leagues aren't going to survive by closing themselves off to the Internet masses, nor are they going to grow their audiences by making the entry hurdles even larger.
Regardless of whether you like American Football or not, it's not a stretch to say that as a professional sports league they are the G.O.A.T. Following Boxing's model: sell the individuals instead of the sport is good for spike's hear and there, but it's clearly inferior.
The problem I see is that MLG has no clue on how to package their product. Football made something, "Any Given Sunday" and sold it to the masses. The game is the game, which they go through great lengths to keep unpredictable and exciting. However their product is a day where you and everyone else has a chance to be a winner just by staying tuned and connecting to the game somehow. This is where the profit comes in - venue sales, merchandising, TV licenses, brand licensing.
The objective should not be to make your viewers pay to watch your event. The objective should be to get business to pay to be affiliated with your event(s) and have access to your customers.
0
As a grassroots tournament organizer, I've seen a lot of this first hand on the smaller side, but it is still scalable. Luckily, I made the NESC2League into a self-sustaining model where all the money goes out to the people competing, and none of it goes to the casters, admins, etc. that's all well and good for the players, but even with ad revenue, it doesn't make up for gas mileage or the time outside of the tournament. It also doesn't leave any money in the league to improve on streaming equipment or improving production. Now I'm moving everything into a semi-pro national model and the money issue comes up even more with multiple sets of streams going out there. Noting that, I don't really think that PPV for the content being provided by MLG is worth it due to the lack of other content. If there was more of a build-up, absolutely. But right now, there isn't and if that was fixed with the build-up material being free or low yearly sub based ($4.99/yr), I'd gladly dish out money to see the climax of a building story. So really what I'm saying is I don't think the current overall format is good for MLG right now, subscription is better IMO and they are doing good for our industry by bringing attention to the lack of ROI that threatens a lot of major events.
5Feb 14th 8:55 PM