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Initially published on Twitter — December 31, 2018
- As gaming continues to become a critical part of popular culture, esports in the West have its best year yet (viewership)
- Revenue growth for esports organizations will lag, despite rising salaries and ops cost. Multiple tier-1 teams will be forced to raise flat and/or down-rounds.
- Fortnite’s dominance will slowly fade, and we will see these ‘new’ gamers transition into other esports.
- Several individual streamers will sign multi-million dollar [guaranteed] deals with YouTube or Twitch.
- We will see several Fortune 500 companies sponsor top esports organizations and players. Slowly sparking the esports sponsorship revenue.
- Overwatch (and Overwatch League) will heavily struggle as they have already exhausted all options to extend the lifecycle of the game.As a result, I think they will pull their last major lever and make Overwatch free-to-play.
- Call of Duty esports will have one of it’s best years yet.
- Rainbow Six Siege will have a breakout year, and cement itself as a top esport title.
- The games that start to embrace and build feeder programs for future professionals (via @playvs, academy programs, etc.) will have the best long-term success in esports.
- All-in-all I expect it to be a great year for esports in terms of viewership and fan engagement. However, I expect investments in the space to slow down and a ‘correction’ to come as revenue continues to lag.
- Fortnite’s insane success as a free-to-play cross platform game will forever change the esports industry.Free-to-play and cross platform is now the bar for every new game released. Major publishers will struggle mightily with this transition.
- Mobile is still one of the biggest opportunities in esports. Supercell (Clash and Brawl Stars) leads the charge here; however, every mobile publisher seems to struggle with the balance of free-to-play and pay-to-win.
- In order for mobile esports to thrive and reach it’s full potential, we need a true free-to-play title. Mobile game publishers need to embrace the medium, rather than copy what works on PC/console.
- League of Legends will have one of it’s best year yet, following the success that Western teams had at Worlds this year (@Fnatic in the finals, and @Cloud9 in the semi-finals).
- Tier-2/Tier-3 esports organizations will start to dissolve and/or consolidate into tier-1 orgs, as capital starts to dry up.
- Most esports orgs will start to look a lot like talent agencies, while they wait for league revenue to be meaningful.
- There won’t be another ‘Fortnite’ in 2019. The games that breakthrough in 2019 will create their own genre.It’s only getting more difficult to breakthrough the noise in established genres (FPS, MOBA, etc.), unless you’re a AAA publisher.
- As payroll and salaries continue to increase for players across esports, we will see esports org. focus and refine their esports strategy (Exit and enter games more rapidly). Very few esports orgs can sustain fielding teams across 5 or more games.
- As the race to become THE App Store for games heats up (Steam, Discord, Epic Game Store) — we will see each of these companies aggressively acquire indie game studios to have their own IP on their App Stores.
- Stick and ball esport leagues (NBA 2K, FIFA, Madden) will struggle, but play an important role in continuing to educate the mainstream about esports.
- Just as we saw Counter-Strike make the move to free-to-play, we will hopefully see other established games follow suit.
- VC investments into esport-centric startups will start to slow in 2019, as there are few $bn opportunities that aren't at risk of being displaced by the major players (streaming sites, publishers, Discord, etc.).
- However, I expect investment $$$ to start flowing towards game publishers, as they ultimately have the most power.