Jan 11 2014 - 4:00 pm

12 years in, Major League Gaming is finally close to profitability

After 12 years as an eSports industry leader, Major League Gaming is finally closing in on profitability
Patrick Howell O'Neill
Dot Esports

After 12 years as an eSports industry leader, Major League Gaming is finally closing in on profitability.

MLG.tv, the company’s major new video-streaming service, has ushered in a major increase in advertising revenue, a feat CEO Sundance DiGiovanni has been championing for months.

Major League Gaming (MLG), the most popular eSports league in North America, has been at the forefront of the industry’s explosion over the past five years. In 2011 and 2012, MLG set viewer records over and over again, but the company’s bottom line always left observers wanting more.

“There's not a tremendous amount of profit being made,” CEO Sundance DiGiovanni told ESFI last year. “I'm saying that because it's reality.”

The New York City-based company, which is privately held and thus not obligated to be open about its financial details, does about $20 million in annual revenue, and it has millions more in venture capital. But there has always been even more money than that going out the door.

Since MLG.tv launched in November 2012,  DiGiovanni told onGamers the company has been EBITA positive, or in other words, profitable before taxation.

While previous forays into daily programming on Twitch ended in failure and layoffs, now for the first time, MLG’s major events and daily video programming are profitable.

In addition to streaming major tournaments in locations like Anaheim, Calif., on MLG.tv, MLG runs programs like the eSports Report, a SportsCenter-inspired summary of the day in eSports news, produced from MLG’s New York City television-caliber studio.

“So now it's just a question of doing more, scale out, and stop when that starts to slow down,” DiGiovanni said, “because we don't want to get to a point where it's not profitable."

The profits have opened up new opportunities, like new events focusing on StarCraft 2, a game that MLG dropped last year.

If MLG.tv is a long-term profit-generator for MLG, the question has to be asked: Will other eSports organizations consider moving away from Twitch, the current industry leader in video streaming?

DiGiovanni emphasized that MLG.tv is not a direct competitor to Twitch—it’s not “a mass market streaming platform where anyone can participate”—but will the idea seduce other gaming companies?

It’s not exactly easy to build your own streaming platform. MLG has had more money to work with—and time for that matter—than most other eSports organizations.

But MLG is not the only company working with the necessary resources. Riot and Valve, the publishers of League of Legends and Dota 2, respectively, immediately come to mind.

Riot’s Dustin Beck, the vice president of eSports, said the League Championship Series is “a significant investment that we’re not making money,” despite being the most popular eSports competition of all time. Could a Riot streaming platform where all the ad revenue went directly into the company’s pockets solve that problem?

Twitch has been the single most important company in eSports over the past few years. If—and this is a big if—Twitch finally faces real competition, the whole industry is in for a real shake up.

H/T onGamers | Photo via MLG

Jan 20 2017 - 5:28 pm

Combo Breaker announcement may imply the end of auto-qualifiers for Capcom Pro Tour

Capcom may be trying to simplify its 2017 Pro Tour.
Steve Jurek
Dot Esports
Image via Capcom

A big change is coming to the 2017 Capcom Pro Tour, but yesterday's announcement may have hinted at an even larger change—a possible end to players winning automatic qualification into the Capcom Cup through Premier events.

The Street Fighter V tournament at Combo Breaker is being upgraded to a Premier event for the 2017 Pro Tour, Capcom announced via Twitter. The event, which will take place in the Chicago area over Memorial Day weekend, served as a Ranking event in 2015 and 2016. Its spiritual predecessor, the Ultimate Fighting Game Tournament, filled the same role in 2014.

Premier events award more Capcom Pro Tour points to top performers compared to Ranking events. A yet-to-be-announced number of the season's top points earners will earn a spot in the Capcom Cup, the season's championship event. Premier events also offer a Capcom-provided pot bonus. The figure has not yet been confirmed by Capcom, but it is believed to be $15,000.

In previous years, a player who won a Premier event received an automatic berth in that season's Capcom Cup. Thursday's announcement, however, may have implied that this is no longer the case.

An update on Combo Breaker's website stated that placing well at the event "will earn you valuable ranking points that put you well on your way to qualifying for the Capcom Cup!"

Notably, the statement makes no mention of an automatic berth into the Capcom Cup, something that every Premier event winner has been awarded since the Pro Tour's founding in 2014.

The statement does not necessarily confirm that auto-qualification into the Capcom Cup has been eliminated. It does, however, fall in line with statements made by Capcom esports director Neidel Crisan. In conversations with both Yahoo! Esports and EventHubs late last year, Crisan mentioned the possibility of eliminating auto-qualification berths in order to simplify the qualifying process.

A player had three ways to qualify for the Capcom Cup in 2016; winning a Premier event, placing high in the global Pro Tour points standings, or placing high in each region's Pro Tour points standings. The system confused fans, commentators, and players alike.

We may not know how qualification for the Capcom Cup will work in 2017, but we do know that the tour itself will look a bit different than it has in previous years.

Combo Breaker will presumably fill a gap left by Stunfest, a French gaming convention that that served as a Premier event on the Pro Tour in each of the last two years. Organizers of that event announced a "pause" for the convention late last year with plans to return in 2018.

The tour will also be without Cannes Winter Clash, the other French event that was part of the 2016 tour. Organizers of that event, which will take place during the last weekend in February, announced the change last week in a Reddit post. The event had served as the Pro Tour's season opener in both 2015 and 2016.

"Obviously with Cannes and Stunfest out there will need to be at least one French replacement event," Samad "Damascus" Abdessadki, a competitor and commentator who is involved in the organization of the Cannes Winter Clash, told Dot Esports. "[Capcom] can't leave France out of [the Capcom Pro Tour] when it's arguably the biggest community in Europe - and maybe [the] strongest."

France is the only European country that has sent two players to the Capcom Cup in each of the last two years. It is also home to Olivier "Luffy" Hay, the only player from outside of Asia to win a Street Fighter IV Evo title.

One event that will return is Final Round. On Wednesday, Capcom announced that Final Round will serve as the first Premier event of the season for the fourth straight year. That event, now in its 20th year, will take place in Atlanta during the second weekend of March.

Capcom will announce full details of the 2017 Pro Tour in late February.

Disclaimer: The author of this article has worked as part of the volunteer staff at Combo Breaker/Ultimate Fighting Game Tournament since 2014.

Today - 5:09 pm

UFC champion Demetrious Johnson on video games, investing in esports, and why Infiltration is his favorite player

He's the best MMA fighter in the world, and esports has his attention.
Callum Leslie
Weekend Editor, Dot Esports.
Photo via UFC | Zuffa

Demetrious "Mighty Mouse" Johnson has a nickname worthy of esports. Which is good, because it turns out the number one pound for pound fighter in the world is a fan.

In between defending the UFC flyweight championship, something he has done a near-record nine times, Johnson chills out the way he always has—playing video games. But now he does that while streaming to an audience of over 82,000 fans on Twitch.

Gaming and online broadcasting has become a massive part of Johnson's career. We spoke to the champ about gaming, esports, and how his two passions have aligned to make him one of the most unique and engaging athletes on the planet.

Obviously we will mostly be talking about gaming, but were you happy with how things went for you inside the octagon last year?

Hell yeah. I had an injury to overcome and got two fights in. Two wins, one finish and one pretty decisive war against Tim Elliot, so I'm pretty happy about that.

Your fighting career and gaming passion have intersected before. In the past you were the only combat sports athlete sponsored by Xbox. How did that come about?

It came about because of my gaming connection, and Microsoft were very passionate about getting behind athletes and Seattle, which is where the Xbox was originally created. I'm a huge game player, so the two brand just merged so well. I know people who worked at Microsoft at the time. It wasn't revolutionizing sports, but it was the first time they ever sponsored a fighter, and the first time ever the UFC was going to be streaming live on Facebook. That was pretty much the first livestream for the UFC. They don't do Facebook anymore, now we have UFC Fight Pass. 

Obviously I fit the brand really well but especially with Xbox, I was passionate about video games before Xbox was around. Back when it was Nintendo, Sega Genesis, Dreamcast, I was in love with that stuff. I played a lot while doing sports. So when the UFC was going to merge with that and doing Facebook live streaming, Xbox saw that as an opportunity to get their name out in the sport of mixed martial arts.

What games and teams are you following in the esports world?

The biggest ones that everyone follows, League of Legends, Dota 2, CS:GO. But I really like to watch the fighting game events, like Evo. Razer have an esports team, Red Bull have an esports team, but the one I really like to follow is Infiltration who plays for Razer, he uses Nash on Street Fighter V. I know I watched Northern Gaming in the World of Warcraft tournaments, but that stuff gets too stressful man! You about to kill a guy and next thing you know he gets healed all the way and I'm like "fuck!" It takes forever. I'm a big WoW guy, but I do wonder why I play it sometimes. I love the game but when it comes to streaming, it's not the most entertaining game to watch on the stream unless you're really really into it. But I love WoW. 

I watched Echo Fox compete at the H1Z1 Invitational, I competed against them. So if there's a game I like, I'll see if there's an esports scene and see if there's a player I like. But the one that really sticks out to me is Infiltration.

Have you ever made it to an esports event in person?

I have not. The only event I've ever went to was the H1Z1 Invitational when Echo Fox were playing, but I was in it. 

We'll see which ones are going on, I know TwitchCon has already been announced and I'm probably going to go to that. H1Z1 is probably going to have an Invitational there. I'm sure Echo Fox will be involved there. I know they have the Dota 2 event at the Key Arena in Seattle.

Right now, traditional sports figures are lining up to get involved in esports. Do you see yourself turning esports from a passion into something more?

Yeah, hopefully. I'd love to sit down with them [UFC owners WME-IMG] and see how the business side works of an esports team. I haven't really had a chance yet. One of the Echo Fox managers used to manage [former UFC champion] Rampage Jackson, and he talked to me about potentially looking into it and seeing if I wanted to get involved. But at the same time it's got to make good business sense for me. I don't understand the logistics of it. You buy an esports team, what's your return, you're hoping that your team wins? There's a little bit more that I need to understand.

Now being a commentator? Whatever the game, I'd absolutely love to do that.

Do you think these people from traditional sports are doing the right thing, investing in esports? Is it the next big thing that they need to be a part of?

If the people are passionate about it and follow it absolutely. It depends on what the investment opportunities are and what the payout is. It's a little bit difficult. Guys like Rick Fox, they have other things and they've made millions and millions of dollars. I heard someone say an esports team costs at least $40,000 or something to get started. It all depends on the opportunities. You got to look at all of the logistics of it. It's a cool idea and a badass thing to be apart of, but it's got to be more than just thrown in for me. We'll see what happens.

Is there any game that isn't currently a major esport that you would love to see on the big stage?

Oh man. If it's an esport, it has to be competitive. I would say Dead Space multiplayer. You would have to fight each other, and also have the necromorphs coming at you as well. Almost like a free-for-all. The one I would really love to see make it as an esport is H1Z1, but there's just so many variables and things that don't work out. Everybody doesn't get a fair chance to start out, so I think it will be hard placed right now.