AEG Goes Deep Into E-Sports With Five-Year ESL Joint Ventureby
Global promoter to provide broad services to e-sports company
‘We are sitting on the evolution of a new spectator sport’
Anschutz Entertainment Group has already hosted sold-out e-sports events in some of the world’s biggest arenas. Now the company wants a bigger role in the growing world of competitive video gaming.
AEG has entered into a five-year joint venture with ESL, formerly known as the Electronic Sports League, that will give the world’s largest e-sports company access to the full slate of AEG’s event promotion business, which includes arenas, ticketing and sponsorship sales.
"We are sitting on what we think is the evolution of a new spectator sport," said Chuck Steedman, chief operating officer of AEG Facilities. "How many times in your lifetime can you say there’s a new spectator sport out there? I don’t think it’s happened in my lifetime."
The partnership is the latest foray into e-sports for a traditional sports-and-entertainment company. WME/IMG and Turner Broadcasting recently created a league and broadcast its season on U.S. cable television. The Pac-12 Conference announced its support for college competitions. Europe’s biggest soccer clubs are ‘signing’ professional gamers to compete under the team’s umbrella.
Live events -- like the upcoming ESL One New York at AEG’s Barclays Center in Brooklyn -- are critical to e-sports’ momentum, said Craig Levine, Vice President of ESL America.
Basement to Stadium
In 2016, e-sports will generate about $493 million from merchandising, media rights, tickets and more. That’s up 50 percent from 2015, according to Newzoo’s quarterly global market report, and revenue is expected to hit $1.1 billion before 2020.
"What’s helped fast-track that growth is the transition of e-sports from something played in your basement to something consumed in social environments, like a stadium," Levine said.
Founded in 2001, ESL says it’s the largest independent e-sports company as measured by revenue, content created and prizes awarded. Two years ago, when Swedish media company Modern Times Group bought a 74 percent stake in ESL for $87 million, the company was valued at about $118 million.
Steedman and Levine said no cash is changing hands in the deal, with the two companies sharing revenues. AEG owns and operates over 120 venues around the world, including clubs, arenas and stadium. Their presence in Asia -- a "big void right now" in ESL’s business, says Levine -- is of particular interest to ESL, which has small offices in Hong Kong and Australia.