The Major Difference: Game Companies

As we established last time, major sports organizations gain a majority of their profit from licencing rights to broadcast their games.  Bringing the show to your TV is the main goal of every game so that broadcasters can show you ads and make THEIR profit. This isn’t all that different in esports, we’re already seeing companies like Blizzard and Riot signing broadcasting deals with companies to stream their games.  But notice that it’s the game companies that are signing the deals, not a league of some kind.  That’s because the creator of the game owns everything about that game and can control who gets the rights which is very different from traditional sports.

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Streaming for charity?!? SHUT IT DOWN!

See, if you wanted to play baseball with some friends in your backyard nobody can stop you.  If you wanted to play with all the people in your neighborhood and make a tournament, fine.  You could even make a movie about it and sell it. Major League Baseball can’t stop you from playing baseball or profiting from it.  But if you were to make a movie about playing League of Legends, Riot Games owns that game and all the rights and could sue you if you use it to make a profit!  Every profit making venture utilizing a game that has a creator, (so anything that’s not a traditional sport like baseball, basketball, football) anything ELSE is owned by someone and they can control it’s use.  Basically using the game in any way gets into copyright issues, which is scary for the little broadcaster.

So the NFL is kinda like Riot Games in that they are both the big company which controls their sport, but for esports the control is more absolute.  This doesn’t mean that gaming companies are going to shut down all smaller broadcasts, streams, tournaments and whatnot but they do have the power to if they want to exercise that right.  Often they will want to allow certain projects to preserve their public image, or smaller ventures will simply be beneath notice, but larger organizations that want to broadcast games will have to be willing to negotiate with the relevant game companies.  And you can expect the agreement to be very profitable for the game companies since they basically hold all the cards.

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Checkmate

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