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National Basketball Association Announces New eSports League

National Basketball Association Announces New eSports League
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With a global revenue of over $1 billion expected by 2019, it comes as little surprise that even the National Basketball Association (NBA) is looking to cash in on the hype surrounding eSports, with the league recently announcing that they will work alongside Take-Two Interactive in order to launch a new eSports league. The newly formed NBA 2K eLeague will launch in 2018, with a full 82-game schedule, postseason and even a player draft expected to be involved.

The new set-up has been established in a big to completely mirror the realism of the NBA, with five player eTeams being run by current franchises, with ten having already agreed to their involvement. The hope is that all thirty franchises will eventually be represented in the digital environment, and if the growth of other eSports games is to go by, it may well not be too long until others are battling to get in on the action.

With millions of fans around the world tuning in to live eSports action, as well as bookmakers offering full betting markets around the phenomenon, the likes of the NFL, NHL and MLB may well be keeping a close eye on developments. The 2K eLeague is certainly a first of its kind within the US, however with growth of 51.7% over 2016, similar initiatives look almost certain in the near future. 

Despite the partnership between the NBA and eSports being the first of its kind, NBA legends including Kobe Bryant, Magic Johnson and Rick Fox are all involved in some capacity, helping the concept to grow over recent years. As well as this, both the Golden State Warriors and Philadelphia 76ers have already invested in “League of Legends” teams that compete professionally around the world.

With NBA 2K having already made a name for itself as the most popular sports platform around, it is now set to grow yet further as a result of such new developments. Although there has been no official announcement on the NBA teams which are already signed up, is seems as though the LA Clippers will almost definitely be involved, with owner Steve Ballmer having made his name in the technology industry. As well as the former Microsoft Chief Executive, the likes of Chris Paul and Blake Griffin have both featured on the front covers of major console games. 

The NBA 2K League faces a struggle to compete with the International Dota 2 Championship however, with the richest eSports tournament in the world offering a prize fund of over $20 million. The multiplayer online battle arena is undoubtedly the most popular eSports game, with 80 skilled gamers battling it out each year at the finals. Chinese team ‘Wings Gaming’ took home the record prize money in 2016, with each of the teams five players pocketing a massive $1.87 million. When compared to some other prize funds from the sporting world, such as US Masters Golf champions taking home $1.8 million, the growth throughout eSports is clear for all to see.

 

Cash prizes will also be on offer in the 2K eLeague, although at around $250,000, it is significantly less than other sectors of the market. NBA commissioner Adam Silver is certainly confident of the program however, stating: "We believe we have a unique opportunity to develop something truly special for our fans and the young and growing eSports community."

The NBA will be hoping to make the most of the huge advertising and sponsorship potential in eSports, with 71% of revenue to date coming from these two areas. Game publishers use eSports as a means to increase the shelf-life of their games, as well as trying to appeal to players of other games. Meanwhile, marketers see the eSports industry as a method of reaching younger and more digitally-oriented consumers.

Coca-Cola, Red Bull and Geico are just some of the major names involved in eSports, with a whole host of events benefiting from such substantial backing. With traditional sports such as basketball, American football and soccer having lost a large proportion of younger viewers, electronic events are now hoping to replace such revenue streams. Major broadcasters ESPN are already offering live eSports events, with Pepsi offering sponsorship opportunities for professional players. With an estimated online audience of over 225 million, along with the thousands who gather at major events, it seems eSports is certainly here to stay.

However, the NBA may not have things all their own way, as despite such figures, direct revenue from eSports still pales into insignificance when compared to other markets within the industry. The console and PC game market is worth an estimated $50 billion and the English Premier League at $4 billion, meaning that even if the industry grew by 50% every year for the next 10 years, it would still be classed as a niche.

On top of this, the eSports fan base is generally concentrated around 18-34-year-old men, meaning that certain advertisers are likely to steer clear. However, if the NBA and their new 2K eLeague can attract a broader audience, including women, then they may well be able to achieve astronomical levels of income.

Edition: March 2017

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