Shady Numbers And Bad Business: Inside The Esports Bubble
From Kotaku
The mainstream narrative of esports has been lovingly crafted by those who benefit from its success. There’s big money in esports, they say. You’ve heard the stories. Teenaged gamers flown overseas to sunny mansions with live-in chefs. The erection of $50 million arenas for Enders Game-esque sci-fi battles. League of Legends pros pulling down seven-figure salaries. Yet there’s a reason why these narratives are provocative enough to attract lip-licking headlines in business news and have accrued colossal amounts of venture capital. More and more, esports is looking like a bubble ready to pop.
“I feel like esports is almost running a Ponzi scheme at this point,” Frank Fields, Corsair’s sponsorship manager, told an audience at San Francisco’s Game Developers Conference last March. He smirked. The crowd laughed uncomfortably. The smile dropped from Fields’ face as he continued. “Everyone I talk to in this industry kind of acknowledges the fact that there is value in esports, but it is not nearly the value that is getting hyped these days.” Later, Fields would clarify that this value, and future value, “as of now, is optimistic at best and fraudulent at worst.”
Fields is not the only longtime esports veteran who is worried the industry is a bubble, or more accurately, an industry comprised of several bubbles. Seventeen other experts on the North American esports industry shared similar concerns with Kotaku, some describing it merely as “inflated” and others as “completely unsustainable.” Several spoke on the controversial topic because they love esports and want to see it succeed organically, in a sustainable way. There is, of course, a genuine love shared by thousands of people for playing games competitively. Right now, many who spoke to us for this story said, the stuff that makes the esports industry seem like a tantalizing investment rests on unsubstantiated claims—or blunt-force lies.
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