By Isaac Chandler
October 24, 2019
Mark Cuban has teased getting into esports for a few years now, with many waiting anxiously for where the beloved Dallas Mavericks owner will stick his flag in the scene.
That dream of him jumping into the industry appears to be dead for now, however, as a recent interview with FS1 has revealed, in which Cuban remarked that owning an esports team in the United States is an “awful business.”
Discussing the issues with the domestic market in esports, Cuban reflected on how many VC’s getting into the scene struggled with telling apart European and Asian viewers for streams, and US and Canadian viewers, leaving many thinking they’re investing into a massive American market that simply doesn’t exist.
He also talked about how low the viewing numbers were for some of these events, with the global Overwatch League only maxing out at around 300,000 viewers or so, an insignificant amount for a league meant for such a large reach (that’s only 0.00004% of the global population).
Mark Cuban continued the esports discussion over on Twitter this morning stating that,
“[In my opinion], the opportunity for Esports teams really comes from organic development of talent that drives a following and leads to sponsor/merch/event revs and possibly event success. The fail comes from chasing name talent with big salaries as a way to justify crazy franchise fees or retaining slots.
But even then, there is risk because inevitably that talent gets cherry-picked or burned out. I think it might be better to be a great development org that acts as a feeder and earns transfer fees. Identifying and developing skill could be a better business. There may be orgs that ready do this but I haven’t taken the time to really check it out.”
Rod “Slasher” Breslau echoed this sentiment after sharing the original FS1 clip, noting that,
“It’s not that esports isn’t continuing to grow every year here in the US (it is), it’s that most esports teams/orgs haven’t monetized effectively, especially compared to the costs of running a team that includes ever-increasing pro player salaries. It’s rough out here for owners.
I’m all about esports pros getting paid with big dollar contracts. Pro gamers didn’t get paid for far too long and deserve it now. but if esports orgs without super-rich owners don’t get it together soon, a lot of those games with high salaried players are coming crashing down.”
The comments by both highly respected men quickly caught the wind on social media, with arguments erupting over whether their claims were truly valid or not, and if there were any games they were referring to.
Many pointed fingers at the recent Overwatch and Call of Duty Leagues. There were exorbitantly high entry fees for games that were either unproven or have had incredibly low viewership.
Others remarked how this may be the needle that finally starts popping the bubble that has been swelling in the industry for years now, causing even more concern over what will be left standing when the scene comes back to reality.
It’s too soon to say what the consequences of the bubble popping will be, but the end of this golden age of growth is coming, and who or what will survive will depend on who can adapt in time.