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There's more than one way to grow eSports South Africa

(Written by Christopher "BudgetChrispy" Commin)

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Perusing through interviews with the South African gaming community, one question appears to repeat itself time and time again: “How can we advance the South African eSports community?” And without failure, the same answer is echoed like a gaming mantra: “More sponsorships.”

Unfortunately, this answer is partially correct. This is because it equates to only one small piece of a much larger eSports puzzle.

Please allow me to explain because the request for sponsorships works as follows:

Large corporate companies with an interest in eSports are requested to sponsor events, which is then in turn utilized to increase the prize pool available to contestants with the aim of attracting new players to the community. The irony is, that this approach only attracts a few new gamers into the tournaments for the period that the sponsorship is available. Once the sponsorship ceases the community reverts back to its previous state.

A further consequence, is that the corporates sponsoring the events slowly become less willing to fund events or tournaments. These corporates provide sponsorships with the express intention of realizing increased revenue, and ultimately profitability through accelerated sales, as a result of the goodwill and exposure they purchase. Should these sponsorships not ultimately lead to increased profitability, they will begin to erode their stakeholder value, which will result in the sponsorships ceasing.

What is required?

In order to deliver a successful South African eSports community, we have to follow those that came before us such as Major League Gaming and Turtle Entertainment and deliver successful sustainable businesses.

That's right, eSports is a business and therefore has to adhere to business principles. The simplest of these rules is as follows: shareholders expect on an annual basis, increasing revenue figures and increasing profit margins as the business scales.

As with establishing any business, in this case an eSports business we need to begin with the basics, such as what is the vision for the South African eSports community. This vision is hidden in the dreams and actions of the South African gamers who love their esport and requires a mechanism to extract it, which is a business designed to deliver eSports.

Last month MWEB GameZone had an in-depth interview with some of South Africa's top gaming companies. One section of the interviewed focus on eSports and what corporates are looking for when they want to invest in players. You can find the interview here, the eSports section is at the bottom with the questions directed to SteelSeries. Another interesting part of the interview is the question "What are you bringing to South African gamers this year?" Both Razer and SteelSeries made it clear that they want to invest more in eSports South Africa.

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What business infrastructure is required?

Just like for any other business enterprise, you need an accountant. Someone to perform the financial modeling, someone to determine the budgets and someone to track the financial actions of the endeavor, ensuring that shareholder expectations are delivered, and if possible, exceeded.

There will need to be researchers. The current gaming community is a diversified one with tournaments, events and gamers spread throughout the country. Individuals will be required to investigate and record, not only the current community structure but also the community’s vision for the future. This research will provide the strategy for the eSports business for the future. In addition, the current role players will need to be documented and all their various contributions detailed, allowing for networking growth opportunities to be explored.

Business relationships will need to be established with all the role players in the community, both local and abroad. These relationship builders will be responsible for unifying the community ensuring that the needs of the gamers, the licensed importers and hardware specialists are understood and are all moving forward in a unified action. They will also be responsible for delivering tournaments, cross platform unification and negotiating those all-important sponsorships. Yes, we still require sponsorships but as a community we need ensure that those sponsorships are converted into sustainable solutions that enhance the community and lead to increased stakeholder value for the sponsors and gamers alike.

Being an electronic environment, you are going to require information technology experts. The gaming infrastructure is going to need the advice and skills of those who can set up local host servers, who understand what impacts on local and international gaming and those who can setup up a local electronic ranking platform allowing all South African gamers to actively compare themselves to their peers. We already have MWEB with its strong infrastructure and motto of prioritising gaming traffic. Telkom Gaming has run successful tournaments for years with the Do Gaming League.

The infrastructure will allow the current community to be documented and understood and the vision of the community to be defined as an attainable goal. Combining an understanding of the community’s external influences with an understanding of its available resources and capabilities, an eSports business strategy can be defined and implemented.

But why go through all this effort?

According to an article published on Dailydot.com in January 2014, the eSports leader Major League Gaming has taken twelve years to finally reach the point of profitability. Meaning, if you enter the eSports arena you have to be in it for the long haul. But then, why go through the effort?

According to research firm, Newzoo:

  • eSports revenues totaled $194 million last year
  • Revenue will more than double to reach $465 million in 2017
  • Viewership will reach 335 million in 2017

You can read more about the Newzoo findings here.

Now, this is a piece of humble-pie that businesses should be fighting over and any gamer should want to be a part of.

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Who am I, to propose this change in focus away from requesting sponsorships?

I am a husband. I am a father. I am a gamer. My twenty seven year gaming career has spanned everything from Space Invaders on our second generation Atari 2600 to Call of Duty: Advanced Warfare on our eighth generation Xbox One. It even includes trying to play multiplayer over a dial-up connection, but hey we learn, or do we, trying to play first-person-shooters with a two-hundred millisecond latency.

During these twenty seven years I have completed an undergraduate degree, an honors degree and articles at a big-four auditing firm. By twenty-eight, I was the group financial manager for a proudly South African company listed on the JSE’s AltX and I’m currently the group financial manager of a national South African organization reporting into two prominent listed South African companies.

Does this make me an expert? I don’t believe so. It means that I have much to learn but maybe up until now I have acquired some skills. What it does make me, is like many of you, an individual with a business orientated skillset who is passionate about delivering eSports to South Africa.

This is because, we are gamers.

What are we asking for?

What we are not asking for, is small sponsorships to boost the tournament attendance at local events. What we are asking for is for something much, much bigger. We are asking for a business infrastructure which can deliver sustainable eSport in South Africa.

We are asking for the Gaming League of South Africa (an eSports initiative).

We would love to hear from our local gamers about what they think would grow eSports South Africa. Drop us a comment!

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Please note that the opinions expressed in this article are those of the author and not MWEB Connect (Pty) Ltd

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