Being the hot new investment lure people use to attract venture capital, esports has been continuously propped up in terms of its value, reach, and size. Every year, projections and reports about how much people watch competitive gaming and how much they’re willing to spend provide progressively increasing numbers. And so, in the feathers of this flaunting peacock, we read how the esports industry’s worth could be in the twelve figures — a statement that’s certain to draw attention.
The latest in these flawed comparisons comes from former Echo Fox owner and NBA professional player Rick Fox. Speaking to TMZ, Fox said that thanks to its global reach and being carried by technology, League of Legends “is coming” for Super Bowl’s viewership numbers.
“As much as we love football in North America, it’s not international to the level of gaming,” Fox told TMZ. “League of Legends is a huge global event. It’s already got numbers right below the Super Bowl so it’s coming … it grows every year.”
While Fox is certainly right about the growth of esports — a trend that’s evident to anyone who even barely watches the space — the delivery on his point comes through a juxtaposition that’s not as black and white as he wants it to be. In fact, similar comparisons often lie on confounding, biased, or downright dishonest foundations, created to boost esports’ value way higher than it actually is. It is done to draw enough capital to secure the next big venture, be that a new artificial league, an esports team with a questionable future, or yet another esports consultancy firm, whose amount likely outnumbers the pool of esports players at this point.
Fox, of course, is not the first or last entity to make such claims, and his is actually among the less inaccurate ones. In fact, this article uses his TMZ quote merely as the trigger for its writing, rather than singeling it out as a main offender. In all honesty, Fox is “technically correct”, but type of correct is not always the best kind, contrary to what internet memes would have you believe.
How do such esports-to-sports comparisons even arise, however? Simple: rules are bent until they form a beneficial narrative, and it starts by:
Creating an uneven playing field
As mentioned, Fox is technically correct when he says LoL is closing up on the Super Bowl. Riot’s official numbers for Worlds 2018 show 99.6M people watched the game, whereas the Super Bowl’s audience for that year totaled 103.5M. That’s just a mere 4M difference between a 50-year-old sport tradition and a ten-year-old computer game. That alone is impressive, and Fox has all the reason to be excited about it.
But that’s still an apples to oranges scenario. The way League of Legends gets close to the Super Bowl viewership-wise is pulling from its entire, worldwide audience, including an absolutely massive market such as China. At the same time, the Super Bowl is really only watched in a single country, the United States. And while, to Fox’s credit, he openly admits it in his statement, how is it fair to compare a global phenomenon to a primarily local one?
It’s not, but esports advocates have no interest in playing fair, because by doing so, they risk portraying the industry’s size accurately, namely: that’s it’s nowhere near traditional sports.
Esports already can’t beat the Super Bowl, even by counting every questionable viewership instance worldwide, so what happens when we compare global to global. Why are there no comparisons between LoL Worlds to, say, the FIFA World Cup in football? Because then we’d put the 99.6M esports viewership to the 3.5B of the FIFA World Cup (basically half of Earth’s population) — enough to show how far the industry still is and why it simply doesn’t belong in the same pool as traditional sports. Or, if we do a direct game-to-game and market-to-market comparison, we’ll have the Super Bowl’s 103.5M next to NA LCS’ 494K peak, the former more than 209 times bigger.
When straight game-to-game comparison doesn’t do the trick, the uneven playing field switches. In January 2019, a report claimed that esports viewership has evened out NBA numbers in the United States, failing to stop and think twice about how this puts an entire gaming industry with dozens of individual titles to a single sports league. Whatever gets the headlines buzzing, I suppose.
But let’s continue.
Conflicting and skewed numbers
Even when playing on an uneven field, esports spokespeople and sensationalism-seeking “journalists” have to pick, choose, and twist data until it fits. Let’s pick up from that Worlds 2018 viewership example.
Of the 99.6M unique viewers Riot claimed tuned in for the final, 44M converged at peak viewership. However, Esports Charts report that of that 44M peak, only 2M — or about 4% — came from non-Chinese platforms. The other 96%, therefore, came from a region known for its flawed, inaccurate viewership data, so much that Esports Charts still report a whopping 203M viewership peak on Chinese streams alone. So everywhere in the world but China, 2018 LoL Worlds’ viewership is but a fraction of the Super Bowl’s. In fact, Worlds’ peak viewership outside China is the same as Super Bowl’s average viewership on various streaming apps, the latter being an extremely niche way to consume NFL content.
Conflicting data appears when agencies and analysts try to estimate how much the esports market is worth. According to Newzoo, esports will be worth $1.8B by 2022, but Goldman Sachs project a much higher, $3B by the same year. And for those loose enough to interchange “esports” and “gaming”, because of course it’s the same thing, market worth goes up to $138B.
But speaking of viewership and value, one relationship — or rather lack thereof — is comfortably omitted:
Popularity does not equal value
Even if we accept that the viewership numbers are real (uneven playing field still in effect, and everything) and that League of Legends is watched almost as much as American football, that’s only half of the argument. At the end of the day, what’s important is not how large the popularity is, but what that popularity’s worth.
The Super Bowl is just one game of the entire NFL season, and even though its viewership is “only slightly bigger than this League of Legends game”, it generated $414M in ad revenue alone in 2018. The average cost of a 30-second commercial has risen to $5.25M in 2019. For the entire 2018, the NFL brought in $3.71B in ad revenue and $16B total revenue, including sale of broadcasting rights, merch, tickets, and other IP licensing deals. The 2018 FIFA World Cup made $5.3B revenue, according to FIFA’s official report, and turned $3.5B profit. At the same time, the European football market brings $31.6B in revenue.
As for League of Legends, the entire game brought in $1.4B in revenue for the entire year 2018, a fraction of traditional sports’ numbers over a much larger period of time. Instead of being profitable, the esports vertical of League of Legends has actually been losing money, which has led to downscaling of its Worlds Championship production and reshaping the format of its major leagues into franchises to stop orgs from abandoning ship. Going back to the 2018 LoL Worlds viewership breakdown with its 96% Chinese audience further shows how little these viewers are worth, given the drastically lower CPM and CPC rates for online ads in China compared to the US market.
In the end, a game — not an esport! — played anywhere in the world where there’s internet brings 16 times less revenue than an US-centric sport, and 32 times less than European football. LoL esports can’t even win the uneven playing field.
At the end of the day, avoiding unflattering contrasts is the only way esports (be it as an individual game or as the whole industry) can come close to matching traditional sports. It’s a tactic employed by those who either want to secure their next VC check, or who want to feel comfortable and important, being part of something they claim is bigger than it actually is. In the real world, esports has much catching up to do.
And that’s ok. It’s perfectly normal for a computer game to be manyfold less popular than traditional sports, while still being a phenomenon within its own zeitgeist. What’s not OK is failure to accept the current limitations and realities of the esports industry and artificially bloating it up for the VC next door.
Even if it doesn’t catch up to NFL or soccer in the next 10 years, esports remains a growing, attractive market — an industry that grew from the grassroots of garages stinking of kebab and Thai food LAN parties to sold-out stadiums, millions of fans and billions in investments. The truth — the real truth — is already impressive.
Why should we make up realities?
Photos by: Riot Games