Apr 16 2015 - 7:56 pm

Echoes of future past: The ghost of the CGS and what it means for Counter-Strike

Last week, the Counter-Strike: Global Offensive community was shocked to learn that ESL, Vulcun, broadcasters and a cabal of team managers were looking to work together to create an exclusive “super league” for the game
Dot Esports
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Last week, the Counter-Strike: Global Offensive community was shocked to learn that ESL, Vulcun, broadcasters and a cabal of team managers were looking to work together to create an exclusive “super league” for the game. 

Those of us who've been in the industry long enough rolled our eyes. “Here we go again.” The greedy and the powerful look to leverage what they have in a bid to secure more for themselves. I can’t get shocked by this anymore. Every day is a reminder that esports is a business now.

Much of the community's negative reaction focused on ESL. Not Vulcun, the company with venture capital wanting to bankroll the league (nearly a week after the report, Vulcun denied it had "plans for exclusive CS:GO tournaments"). Not Twitch, the broadcasters who want to secure the rights. And not the managers and team owners that have collectively bargained for their profits. Of course, this plan had been in the pipeline for weeks. The idea that any party is more invested than any other is bunkum. 

Be under no illusion: This is isn’t as simple as one party leveraging all others. I know, because I’ve seen this before.

The Championship Gaming Series (CGS) came together in much the same way. For those that don’t remember our Counter-Strike past, let me give you the broad strokes: A suit called David Hill, who had been the President of Fox Sports since 1993, left that role to join satellite TV company DirecTV in 2005. As president, he soon discovered competitive gaming, supposedly thanks to his gamer grandchildren. He was certain esports was destined to be so popular that he needed to get in on the ground floor.

Having headed up Fox Sports, Hill knew all too well the problems that would face a broadcaster if esports grew big enough. He was particularly concerned over bidding wars for broadcasting rights, as he'd seen first-hand how they could snowball into ridiculous amounts of money. As he started planning what would go on to become the Championship Gaming Series, he knew one thing for sure: The company would own the broadcasting rights for the league. Amid a convoluted network of television stations with multiple owners, it was News Corporation, of Rupert Murdoch fame, that ended up putting aside in excess of $50 million under Hill’s recommendation to fund this bold new venture for five years.

For this model to work, Hill needed two things. First, credibility. Sure, he and his colleagues may have run one of the most sprawling global media networks. But they were novices in the field of esports. Their long-term vision could only work if esports outsiders became fans. But initially, the target was the core audience of esports fans. To get its buy-in, CGS went on a recruitment spree, trying to attract as many big names as it could.

Second, Hill needed exclusivity. If you could watch the best players play week-in and week-out in an open tournament circuit, it strongly devalued the CGS product. Anyone who wanted to join up with a lucrative CGS deal would need to play exclusively for CGS. Some, such as CompLexity, even sold their brand to become full time franchises that they retained a controlling interest in.

We’ll come back to exclusivity momentarily. For now, let me tell you what the CGS really was from the people in the industry at the time, including me: It was the payday everyone had been hoping for.

By the time CGS was a reality in 2007, it represented the biggest show in town. The Cyberathlete Professional League, the pioneer of high level competitive gaming, was on its last legs with organisations complaining about being owed tens of thousands in prize money. Its founder, Angel Munoz, had once been known as the Godfather of esports. But now that name took on a very different meaning, after he failed to pay out prize money to some teams and was accused of other financial transgressions. You didn’t have to look too far to find an esports luminary who had lost money chasing a pot of gold at the end of a rainbow that never materialized.

In fact, fuck rainbows. Esports at this time was populated mostly by Captain Ahab types, grizzled veterans who were all desperate to spear the whale that had cut them off at the knees. For these types—addicted beyond explanation and driven beyond reason—the CGS was the justification for broken families, emptied bank balances, and burned bridges. It was as much validation for a life of strange choices as it was the financial reward. But those rewards were ridiculous.

Everyone in CGS was overpaid. The more credible you appeared, the more you got paid. And some of the money doled out was simply absurd. Exhibit A for fiscal mismanagement will always remain the $300,000 per season paid to the legendary Quake and Painkiller player Johnathan “Fatal1ty” Wendel for commentary he was barely equipped to deliver. But he wasn’t alone in being overpaid. Most who agreed to get involved made enough money from this one doomed venture to fund a comfortable existence for the rest of time.

CGS was the first time I’d seen the esports equivalent of “golden handcuffs” so liberally applied. The money ensured that all the luminaries CGS now bankrolled couldn’t and wouldn’t say anything negative about the the league's decisions, and certainly couldn't talk about how it had potential to damage the developing eco-system of a young industry. 

People who signed contracts with CGS largely ignored how it went after organizations who stood up to it. CGS tried to absorb every esports press outlet through aggressive use of press partnerships, refusing access to anyone who had written anything “off message.” It presented an illusion of meritocracy in its decision-making process, while in reality there was a list of people deemed potential risks to the project who could never be included.

Every lesson I learned about what happens when greedy people get their own way in this business came from CGS. It was the first time I’d had a ground-floor view of the madness and how far people will go in a bid “to grow esports”—but only in tandem with their bank balance. It showed me how political the scene could get, how people at the top didn’t want dissenting voices in an industry they wanted to profit from. It’s a trend that continues to this day

Let’s get back to the concept of exclusivity. It can damage scenes in any form. It's anti-competitive—that's its implicit purpose, after all. The CGS had originally aimed to be entirely exclusive, but privately some team owners complained that this would limit their earnings and potential sponsorship deals.

For example, U.K. franchises London Mint and Birmingham Salvo wanted to attend UK events such as Multiplay’s I-series, which was essential for exposure in that market. While CGS didn’t necessarily approve, it did recognize that a one-off LAN event held over a weekend didn’t pose a lot of threat to its global league. It altered the contractual agreements to feature “Limited Exclusivity,” making it so that teams could attend other events if they obtained express written permission to do so. 

There were some caveats, of course. The teams had to wear their CGS jerseys, they could only use CGS players or taxi players (glorified substitutes recognized by the CGS that could be traded into line-ups at any time), were expected to toss out liberal mentions of the CGS in any media appearances.

This revised agreement alone gave the CGS substantial leverage over every other tournament in operation. Where prize funds are dependent on sponsorships and sponsorships are dependent on exposure, limiting a sizeable group of elite players from attendance would harm anyone they deemed worthy of such attention. None of these other companies were consulted about CGS nor gained anything from its existence, yet the success of their businesses—who all would have made a substantially greater contribution to growing esports—were now influenced by remaining in the good graces of a competitor.

This might play out every day in the world of white collar business—a defense that I'm sure the people with the money will peddle—but esports still remains a grassroots phenomenon.  And I don't think this excuse is something we should just accept. There are always ways the power of exclusivity can be abused, even ways that would be detrimental to the people who are supposed to benefit from it.

Just look at what happened to Kevin “aZn” Wang.

Wang was a Counter-Strike 1.6 player that had switched over to Counter-Strike: Source, which the CGS primarily focused on, as it was better for television broadcasting. He decided to attend a small North American 1.6 LAN event with friends. But he didn’t request permission. He knew that the CGS didn’t want any of its employees or partners doing anything that promoted 1.6. That game still had a significant following and a community vocally angry that the CGS hadn't chosen its game. So Wang attended the event, and was promptly fined $5,000, a sixth of his annual salary, for his transgression.

The resulting drama prompted a few other things to happen. Most notably, CGS terminated Wang's contract. This errant decision cost him his job and, as it transpired, his entire future as a salaried esports competitor. In a bid to appease the 1.6 fans who were outraged at what had happened, CGS announced that 1.6 would be featured in its online league. That league's entire concept was an afterthought, designed solely to increase reach into other communities. Needless to say, no one was appeased. And all the anger online didn’t compel the CGS to reinstate Wang or revise its over-zealous fine.

CGS's executive employees walked around with an obnoxious swagger. Their confidence, come from regularly penalizing dissenting voices, spilled over into every business transaction—even if it made no business sense. Take for example my own dealings.

I worked as the head of European coverage for CGS in 2007. But my tenure there came to an abrupt end over editorial disagreements shortly before the start of the second season. I soon found work as a manager in what was then the U.K.’s largest LAN centre, which hosted the European event. This detail had seemingly gone unnoticed by CGS. When the company learned about it, it held meetings with my manager threatening to pull the £60,000 fee for the weekend and have the event elsewhere if I was allowed into the building.

Can you even imagine the logistical nightmare that would throw up for them if my employers refused? Were they really willing to move the event at such short notice to somewhere else in the UK? It’s hard to answer that even with the benefit of hindsight because these people were intoxicated with the belief they were untouchable. The compromise was that I was told to take annual leave. I did, then attended the event as a spectator anyway, much to the disgust of the suits that thought they had a deal.

There were other examples of what is these days termed “overreach” if you’re Brandon Beck. It seems a fairly benign term for what is really about crushing any opposition through any means at your disposal. The CGS didn’t just influence the games that it represented, it actively harmed others it didn’t. 

It wasn’t enough that it artificially inflated scenes based on their own whims, they didn’t want anything to have the potential to overshadow their own creation. The exclusivity agreements, as well as huge financial clout, gave them the tools they needed to chip away at anything else. Esports then, as it is now, can be summed up by the old saying from Broadway producer David Merrick. “It’s not enough that I should succeed, others should fail.” Tellingly, that quote is often falsely attributed to Genghis Khan.

Then it collapsed in on itself like a souffle made of shit. Too much money spent, not enough returns. The employees that never really understood this industry to begin with, thinking their boardroom experience would transfer over to an amateur pursuit, all fell short. But hey, they can go back to their car dealerships, their golf courses, their law firms. It’s the people dedicated to making esports a long-erm and sustainable industry that have to clean up the awful, foul-smelling mess they leave behind once the budgets run dry.

The aftermath of the CGS was wretched. Some of the games that were nowhere near ready for a professional tier simply evaporated when it was taken away. For Counter-Strike, sizeable numbers of players (who felt they had all been screwed out of a payday for not knowing the right people) quit out of frustration. This left a sizeable gap between the pros and the amateurs. Talent wasn’t coming through because the CGS existed in a vacuum. The professional players who could go back to 1.6 did, but the bulk of the Source players were left with a grim realization that they would probably never see money like that again. Amateur organizations felt under pressure to offer salaries that weren’t sustainable to attract this talent. For North America especially, this led to a culture where players simply played for themselves, founding teams for events that they knew they could win and attending only when profits were likely.

Many competing companies had been slowly asphyxiated during CGS’s existence. If their bread and butter happened to be a game that was on the same ticket and they were sizeable enough to make CGS nervous, then they simply couldn’t have the elite level talent attend. For the second-tier teams outside of CGS this meant they were left cruising towards dull victories for greatly reduced prize funds.

It also meant that esports and television was seen as a failure in the eyes of potential outside investors. For years, that was the Holy Grail—to get on television and open the eyes of the mainstream to what esports had going on. Now, CGS showed esports wasn’t ready; it was a risky flop that didn’t even go the distance it had budgeted for. If it wasn’t for the streaming boom, I really don’t know what would have become of esports.

So for all of these reasons, it's understandable we should be nervous, especially when you consider that the esports landscape was far less defined back in 2007 than it is now in 2015.

What would such a deal mean for the DreamHacks, Fragbites, Gfinitys, Major League Gamings, FACEITs or any of the other companies that have helped build up the scene we have today? Do we want them to suffer in the name of competition? What would happen to the unprecedented growth this version of Counter-Strike has undergone? Why is it that these companies can come together to rush through exclusivity deals but have never been able to satisfactorily work together with competitors in the name of inclusion? Do we want so many parties with so little Counter-Strike pedigree to once again shape the collective destiny?

With the deal on hold temporarily now is a good time to ask these questions but the parties that really need to provide the answers will remain quiet while they strategize the next phase of planning. There will be a propaganda offensive from all sides, including companies on the outside looking in pretending they wouldn’t do the exact same thing if they had the opportunity faking moral outrage. Just another reminder that esports is business to these people. 

But it isn’t to you.

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