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How Esports Teams Make their Money

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Esports is a multi-billion dollar industry. Esports is growing in popularity, with tournaments drawing large audiences and teams gaining huge sponsorships from large companies.

The most popular esports games are played globally and have amazing betting guides, with fans from different countries participating and watching them online. Some of the most prominent esports competitions include The International (Dota 2) and League of Legends World Championship Series (LoL).

Esports has been considered to have high growth potential due to its mass appeal and global reach. Esports are on the rise, but one question remains; how do they make their money?

Selling Access to Live Events

A large portion of revenue for esports teams comes from selling tickets or broadcasting rights for their live events. These can range from small in-person tournaments with relatively low production value, for example, the Smash Bros Melee tournaments, to massive stadium-sized competitions.

Another way esports teams make money is by paying players salaries. Teams player’s wages to keep them on their rosters and ensure they stay competitive. This can range from hundreds of thousands of dollars per year for top-tier teams.

Selling Player Merchandise

Selling player merchandise includes everything from player-branded clothing and hats to team-branded accessories. The most common way for this to work is when a player decides to sell their merchandise in addition to representing the team.

Players can sell their brands of gear on their websites, as well as an esports organization selling branded apparel through its online store.

Sponsorships

Sponsorships are the most significant source of income for esports. They’re usually short-term but can also be long-term, depending on various factors. Sometimes they’re monetary, and others are non-monetary.

Local sponsorships can be within one region or province. Regional sponsorships include multiple areas across a continent or country, while national sponsorships are found on a national level in some countries. For example, soccer teams are sponsored by major corporations like Coca-Cola.

These would have local reach and international reach since they’re famous enough to be recognized around the world. Global sponsorships are when you see something like “This video game was made possible by…” at the beginning of your favorite streamer’s videos.

Companies sponsoring a team want worldwide exposure. So, they’ll likely choose someone who has vast followership across all social platforms, such as YouTube Gaming or TwitchTv.

Licensing

If a company wants to sell its product or brand, it must first license the rights to do so. The process is simple; one party grants permission to another party to use a trademark in exchange for money. Licensing is a great way to make money from your brand, and esports are no exception!

Some famous brands that have licensed their products include Coca-Cola and McDonald’s. Licensing can also be used. An effective marketing strategy for expanding your current audience and reaching new ones. 

You can provide official apparel, accessories, and other gears that fans can buy online or in stores. 

It’s essential for esports because they need all the exposure they can get!

Intellectual property 

Intellectual property is the legal right to an idea. It can include anything from a song to a game, and it’s used in esports to protect teams from copycats.

For example, if you had a fantastic idea for a new FPS game with all these great features, but someone took it and published it as their work before you did, they could sue you for using their intellectual property.

There are also non-game-related types of intellectual property like merchandise and music rights. They are sold separately from teams’ sponsorships and streaming deals.

These can be lucrative sources of income for esports teams because they’re unlikely to compete with other projects that have nothing directly related.

Tournaments Winning

Esports can also generate revenue from winning tournaments whenever they compete. Although it’s not a consistent source of income for esports teams since they might not succeed in every game, the tournament winnings can sustain the time.

Players are motivated to stay competitive and win more for the team to run its activities smoothly and for the players to make a sustainable career in the esports world.

Conclusion 

Esports, previously considered a fringe activity for nerds, has become a multibillion-dollar industry. Many people are still surprised to hear that it’s possible to make money playing video games, but the truth is that this has been an emerging market for many years now. 

Esports’ popularity is growing exponentially, and it will soon be one of the largest entertainment sectors in the world. But how are these players paid? It turns out they have various ways to make their money!

Asia

Mobile Global Esports announces exclusive compression technology partnership for upcoming Indian esports social-gaming platform

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Mobile Global Esports Inc. (NASDAQ:MGAM)  the mobile esports and social platform company that holds trademark and IP rights for collegiate esports tournaments and players in India, today detailed a joint product development partnership featuring EVE encoding, a proprietary compression technology that reduces video file size by as much as 65% compared to other commercially available products.

“Esports is growing at a phenomenal rate in India, so everything we can do to maximize the current mobile infrastructure for our upcoming tournament season matters,” said Mobile Global Esports CEO David Pross. “We believe EVE compression removes major obstacles in the market and will position us to deliver a great user experience to esports viewers and to tournaments and gamers, with real potential to scale.”

“MOGO is an incredible use case for EVE and all of our video capabilities,” said Anthony Rennert, CTO of ZuCasa and creator of EVE. The fact that this partnership is for the Indian market, where we have great experience, is even better.” EVEMETA and ZuCasa are software companies that focus on video delivery and engagement, respectively. Anthony previously led Howard Stern’s digital team and has worked with or acted as a consultant to Cogent, Time Warner, China Telecom, Qwest, TATA as well as many others.

“With Bharti Airtel, Vodafone Idea and Reliance Jio acquiring significant swaths of 5G bandwidth in the recent auctions, India’s top telcos are banking on esports to drive acceptance of their new 5G offerings,” said Sunny Bhandarkar, Mobile Global Esports vice president, India. “While 5G will offer the faster speeds and low latency competitive gamers demand, its short transmission range and limited availability make our EVE compression across the board more valuable for both future 5G and current 4G esports competitors and viewers.”

A 2022 FICCI EY Media and Entertainment Report estimates that active e-sports players in India had a 2X increase to 600,000 in 2021 over 2020, and that there are now over 100,000 e-sports teams, with viewership up from 600,000 hours in 2020 to just under 2 million hours in 2021.

The EVE Network Engine Optimizer (NEO) reduces the bandwidth needed to transmit high quality video by more than half, benefiting network operations, content distribution and content ownership. By effectively multiplying the capacity on existing infrastructure and lowering costs throughout the workflow, EVE increases throughput efficiency and quality of video to dramatically improve distribution performance.

EVE is codec agnostic and all decoding is based on international standards, with resultant files or streams playable in any browser or video player that supports standard codecs. There are no B frames, providing faster decoding, minimizing battery use and expediting rendering. EVE is easily integrated into streaming delivery using the EVE Console or using REST based APIs that can be inserted directly into existing workflows. Data sharing and storage is maximized via cloud, locally or hybrid with full redundancy, providing a cost-efficient storage model while reducing the expenses associated with self-hosted storage solutions. EVE also supports OAuth 2.0 authentication enabling data sharing without sharing passwords.

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eSports

Indian Esports Industry Overwhelmed With DOTA 2 Team Winning Bronze Medal; bat for Esports recognition as a sport & Brands Support for the Athletes

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The Indian DOTA 2 team produced a power-packed performance to clinch the bronze medal at the first-ever Commonwealth Esports Championship. 

The Indian Dota 2 team, comprising Moin Ejaz (captain), Ketan Goyal, Abhishek Yadav, Shubham Goli, and Vishal Vernekar, defeated New Zealand by 2-0 in a best-of-three format. 

Indian Esports industry is overwhelmed by this bronze medal win and bat for Esports recognition as a sport so as the players who are bringing laurels for the country gain the benefits and support any sports community and athletes would receive. Also, the community requires the brands to come forward and support the teams and athletes in a long run to reach their ultimate potential. 

Not to forget that Esports is a proper medal event in Asian Games 2022 which is scheduled next year in Hangzhou from 23rd September to 8th October 2023 (earlier in 2018 it was there as a demonstration title and India had managed to secure the bronze in Hearthstone courtesy of Tirth Mehta). The esports titles in which the Indian contingent is participating are – FIFA 22, DOTA 2, League of Legends, Street Fighter V and Hearthstone. So, there are multiple medals at stake in esports at Asian Games 2022.

Lokesh Suji, Director of Esports Federation of India and Vice President of the Asian Esports Federation:

This win is a historic moment for the Indian Esports ecosystem and will not only aspire many esports athletes to represent India on a global stage but will help establish India as an esporting nation. We need to build a robust & sustainable esports ecosystem for India which is inclusive and diverse (developed across multiple esports titles), leading to the shaping up of not one/two but hundreds of medal winners across multiple esports titles and gender.

For brands, they have to look at Esports as their long-term marketing strategy to develop and grow the sport and not just for their activation tools. Our athletes/teams need support and encouragement from the brands for the long run just like any other sports athlete. We hope brands will put their focus and eyes on this next-generation sport and come up with a long-term vision to grow the sport and upskill our esports talent.

Animesh Agarwal, Founder and CEO at 8bit Creatives, a leading gaming talent management agency and an ex-esports athlete himself:

After years of grinding, this victory has surely put us a step ahead in the process of recognizing esports as a sport by the Indian Olympic Association (IOA). As someone who dreamt that esports and gaming will one day shine, when people were not even thinking about it, it personally means a lot to me ofcourse. But when I see the impact it is having on the industry and on our society, I realize its true impact. We have the potential and we can surely nurture many athletes for such upcoming events.

Apart from that, it should be inspiring for many of us as we won one in Asian Games 2018 and now this one makes it clear that we can do a lot more if given the desired chances. We hope that this win will result in more tournaments around all Esports titles and a  tally of investments and sponsorship for the teams and athletes in India. The more support for gaming flourishes, the more gamers can help good brands and products reach the right audience.

Mr Sagar Nair, Co-Founder & CEO, Qlan, The Gamer’s Social Network:

The win at the Commonwealth Games 2022 by the Indian Dota 2 team will go down as a landmark moment for Indian esports on multiple levels. I’m confident that this victory will pave a path for esports in India to be put in the bracket alongside any other mainstream sport in the country. The fogged perception and narrative around esports in India will witness a much-needed change in the right direction where every esports title will be backed by the stakeholders of the ecosystem. You never know what title will lead India to its next medal.

Looking at it from a marketing perspective, this opens up doors for brands to get into team sponsorships, athlete endorsements, product integrations and any other form of brand partnership that brands have been engaging with other sports and athletes. Also, as esports is a proper medal event at the next Asian Games, this can potentially open the floodgates for brands to reach out to a massive GenZ consumer base.

Rohit Agarwal, Founder & Director, Alpha Zegus, the next-gen marketing agency specializing in the domains of gaming & lifestyle:

It’s a very big moment for the entire gaming community. Seeing our Indian team being a part of CWG was a matter of pride in itself, but our victory added immense confidence in everyone about the direction in which Indian Gaming Space is going. Not only is this a confidence booster for players, parents, and other stakeholders, even brands will take notice of such achievements. They would definitely want to associate with current (or potential) names that put India on a global roadmap, similar to sports like Cricket.

We might even see brands recognize players from games apart from the mainstream games, and give a certain monetization boost to a new segment of gaming altogether. 

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eSports

Veloce breaks half a million monthly views

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Veloce breaks half a million monthly views
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Veloce, the UK-based next-gen sports ecosystem, has recorded over half a billion views across its YouTube channels in one month for the first time. The landmark continues the growth of the Veloce’s fanbase that can watch and support their favourite gamers and drivers as they compete around the world within one ecosystem.

  • In four years, monthly viewers have grown from 27,000 to 500m
  • In the last year alone, monthly viewing has grown 150% from 200m to 500m
  • Veloce’s new TikTok channel alone has 140m monthly views
  • 35m subscribers across Veloce channels on YouTube

Rupert Svendsen-Cook, CEO of Veloce Group, said: “To hit half a billion monthly views in under four years is special. With other channels like TikTok we are going over 640 million a month. That just shows you the appeal Veloce has but also the growth of Esports and other future focussed sports.

“We are talking about a huge, young audience, engaging with sports, both physical and digital, in a new and different way. We think it is the future of how fans will consume sports in the future, around the world. We are going to keep building that ecosystem for our fans and giving them the great content they want.”

Veloce, based in a studio in West London, have grown from their founding in 2018 as an Esports team with three employees to one of the fastest-growing modern media and sports rights holders in the UK with over 40 employees and teams competing at the cutting edge of the future of sports.

Veloce Group’s teams compete in future focussed sports, both physical and digital, championing sustainability and gender diversity. In motorsports, Veloce compete in Extreme-E – attracting partners like E.ON – and won the W Series last season with Jamie Chadwick.

In Esports, Veloce operates over 10 teams, both under the Veloce umbrella itself and across partner and joint venture operations, including Mercedes F1, McLaren, Quadrant (with F1 driver Lando Norris) and Yas Heat. Further, Veloce has over 60+ gamers competing across titles such as Official F1 Game, Forza, GT Sport, DiRT Rally and Project Cars.

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