The Overwatch League had a great debut a couple of weeks ago, with more than 10 million viewers turning in during the first week of the inaugural esports league based on Blizzard’s Overwatch third-person shooter game.
One of the early believers in esports was Peter Levin, president of interactive ventures, games, and digital strategy at Lionsgate. He invested in Immortals, the Los Angeles esports team which created a new team, LA Valiant, to participate in the Overwatch League. Lionsgate also invested in Immortals/LA Valiant. Activision Blizzard sold the Overwatch League franchises for an estimated $20 million, and it gave each franchise owner a region as part of a worldwide geographic competition.
Market researcher Newzoo estimates that esports will become a $1.5 billion to $2.5 billion business by 2020. We talked with Chou about his impressions of the first week of the new league.
With Levin, Lionsgate has become active not only in esports, but video game licensing, game startup investments, and virtual reality experiences as well. I spoke with Levin about his impressions of the Overwatch League, running an esports team, and the larger prospects for esports.
Here’s an edited transcript of our interview.
GamesBeat: You saw the numbers, about 10 million views?
Peter Levin: Yeah, I’m neck deep with these guys, on the line with them regularly. I couldn’t be more pleased with the first bucket of data we’ve seen.
GamesBeat: Did that strike you in any way, where people might have been coming from? There had to be a lot of overseas viewers.
Levin: I’ve not yet seen the breakdown of the markets. I will say—one, and say this a lot to my team, probably one of the hardest things to do in media, including gaming, is to launch a globally successful video game. Probably harder than launching a blockbuster film franchise. It takes longer to develop. It’s exponentially more expensive. It’s a commitment of hundreds of people deploying against a discrete product. If you’re able to do that, launch a successful esports title—only a handful have risen above the noise the way games like DOTA 2, Counter-Strike, Overwatch, and League have been able to do.
That’s a completely separate discipline from launching a successful 21st-century league, and that’s what Activision Blizzard has done. That, to me, is extremely impressive as an owner within the league. The level of commitment, dedication, and professionalism these guys have deployed against this, from the top down—that’s my other point. From the first meeting we had in Overwatch, Bobby Kotick was in the room. The first followup phone call we had with Activision Blizzard, Bobby was on the call. At the first owners’ meeting, Bobby greeted everyone at the door with a handshake and stayed for the duration of a nine-hour meeting.
At our first match last week, where I brought a gaggle of senior Lionsgate executives to be exposed to this for the first time, the first words out of Bobby and his team were, “What can we be doing better for the owners? What should we doing going forward to make this product better?” That’s been the attitude since day one, and I think that’s what’s led to this early traction.
GamesBeat: How did you find the spectator experience?
Levin: It was incredibly energetic. Myself, probably like you, I’ve been to more esports events than most people that were in attendance. But the level of detail around the screens, the gravitas that was created with the teams up on the dais the way they were, the enthusiasm of the crowd, and the knowledge of the crowd about the game, the subtleties and nuances of the game, created a great competitive gaming experience.
The amount of energy around—I couldn’t even buy something at the gift shop before our match, because the line was too long and I didn’t want to miss anything. I thought that was a great bellwether of things to come. But again, I think it’s the quality of the executives and the level of executive acumen that they’re deploying against this—it’s great for the entire industry. They’re setting the bar very high.
GamesBeat: How did the Immortals/LA Valiant do?
Levin: We’re the L.A. Valiant now, which is part of Immortals. Blizzard wanted all of these teams to be named independently from the names they compete under in other games, so we’re the L.A. Valiant. We’re 2-0 right now, so we’re off to a good start, but the competition is heady. You’ve got a lot of commentary out there about which teams are in a leadership position.
For me it’s much too early to tell, but the second round of matches against Dallas were nailbiters. The score might not indicate it, but we were all on the edge of our seats. I think the parity of competition is great. The localization, the city-based teams, that’s clearly generated a whole new level of local engagement and fan bases. If you read some of the things that the Kraft family, Robert and Jonathan Kraft have had to say, it’s the first global launch of a league. It’s one of the first opportunities to do something like this, because of the global nature of esports.
For us, I can’t imagine being an esports team owner in Los Angeles, with partners like AEG, arguably one of the most accomplished sports asset ownership groups in the world, and Mike Milken, who touches every corner of media and has the definitive global conference in here in Los Angeles every year—having AEG as a partner and eventually being able to leverage that footprint down at L.A. Live, where they own the Staples Center and the Microsoft Theater, multiple venues surrounded by demographics that map incredibly well onto an esports audience.
Coupling that to all that Mike Milken brings to the table, and Lionsgate being a forward-leaning media company—we were the first of the studios to jump into the fray. Now you have both Comcast and Disney in ownership positions, which is fantastic. But yes, if you’re going to activate in L.A. with sports, entertainment, live events business, we have about as strong a partnership as we could ask for.
GamesBeat: What reactions did you get from your fellow executives who aren’t necessarily game people?
Levin: They were incredibly excited about what they saw. Strategically, I was able to put some of the Immortals and Valiant executives close enough to answer a bevy of questions relative to what exactly they were watching. But what they did get was the level of energy in the room. You have 500 screaming fans. You have just a beautiful presentation with the enormous screen they have. You have approachable commentators that aren’t speaking above anybody. They make the broadcast more approachable to those that are learning the game, even if it’s your first time seeing esports competition.
What they really get, since they’re media executives, are the numbers. When you read about Twitch and the economics around that two-year deal, or when you read about global sponsorship partners like HP and Intel and more to come—then you get the forensic analysis of week one. This is the first week, the inaugural week of the inaugural season of the Overwatch League, and the numbers are what they are. Nobody is going to look sideways at those metrics.
GamesBeat: What do you think needs to happen going forward? How can they sustain the attention?
Levin: Well, the game is growing. There’s data to support that. If you don’t have a game that competes at the level of the top four or five games, we’re not even having this conversation. The game continues to grow. What they’ve done well, and I can speak on behalf of Immortals and Valiant—we’re three years in this market, and I think operationally we have done as good a job as anyone in North America on pretty much any measurable index with respect to operations. That’s not just competition, right? That’s social outreach, content generation, fan engagement.
What Bobby and his team have done, top down, is seek out the best operators. That’s what we do. We operate. Bobby realized there’s enough riding on this that he was going to be personally involved, as I mentioned. He’s not delegating two or three rungs down the ladder. He’s empowering his executives. Most important, and this is something we learned from day one, they are very desirous of collaboration with their ownership. They’re clearly in some new territory as Activision Blizzard, and so when you have owners like the Krafts, or like the Wilpons, or AEG, Mike Milken, and Lionsgate, there are clearly going to be relationships within the industry that we can bring to the table. Instead of the “not invented here” perspective, they’ve been extremely collaborative, leaning into cooperation with ownership, which is great.
GamesBeat: As far as parallels, the idea that esports can be as big as traditional sports, what are you looking forward to on that front?
Levin: Rather than look at it as, this is the demise of traditional sports, I really do think this is a completely different animal. Other than soccer, and to a degree martial arts, esports is probably one of the only competitive activities that truly ports globally. It happens to appeal to both the most coveted and elusive of demographics. That makes it even more attractive to brands and marketers, particularly global ones. Yes, there will be some facets and assets of traditional sports that will apply. But I also think it’s a bit of a brave new world.
Even when you look at the distribution relationships that Activision Blizzard put in place from go, in markets like China and Korea, and with Twitch, it has felt global from day one. When you have teams from Shanghai and Seoul and London, it’s felt global from day one. Those teams are not peripheral or subordinate to the New Yorks and L.A.s. In fact, Seoul is probably one of the most feared and respected franchises out there. That’s a good thing.
I just think it has this global orientation from day one. That’s been the in the DNA of esports for years and years. Fortunately, with a partner in Activision Blizzard—they’ve been a global business for decades. They’ve thrived in markets that have been tough to penetrate for traditional sports and traditional media. They haven’t had those same issues.Continue Reading …