eSports and Video games – Opportunities from this emerging trend

posted by Ravi Arora February 13, 2018

In the previous post, I discussed that for emerging trends like Blockchain, IoT, Machine learning to become true, a few breakthroughs will happen. In this post I have discussed yet another emerging trend, which many of us are unaware – eSports and gaming. I have also discussed the far-reaching effects of this trend on businesses, future of work and social challenges.

eSports

You might have heard of eSports but perhaps not about twitch. In India various sports have gained momentum in the recent past due to growing popularity of Premier league of Cricket, Soccer, Badminton and Kabaddi. These are physical sports that teams play against each other. In today’s world when everything has an ‘e’ as a prefix like ecommerce, eticket, ebanking, elearning, then why not eSports? eSports is a competitive video gaming. Like any other team sports, eSports is an organized, multiplayer video game competitions, particularly between professional players. The majority of popular eSports are team-based games played in leagues or tournaments throughout the year, culminating in one final event. These have become so popular that tournaments such as The International, The League of Legends (World Championship), The Evolution Championship Series and the Intel Extreme Masters also provide LIVE broadcasts of the competition – like tournaments of traditional sports like Wimbledon, Premier League, NBA, Super Bowl, Cricket World cup etc. Twitch is a Live streaming video platform that broadcasts eSports competitions. 80 million people watched the semifinals of the World Championship of ‘League of Legends!’

eSports will be part of the 2022 Asian games and could be included as one of the sport in 2024 Olympics! Rapid growth of this sports in future is inevitable. Does this growth provide an opportunity for those who are not connected to this industry?

Many video games on PCs are available for free to people to start playing but if one wants something cool—like a specialty armor, a “mount” for traveling faster—it must be bought. This business model has been wildly profitable. A top-rated free-to-play game, like Clash Royale, used to do a business of $2.1 million a day from such (virtual) purchases. As with casinos, most of the revenue from video games comes from “whales,” a tiny percentage of players who spend thousands annually. A study by Swrve (a firm that helps companies market in-game items) discovered that just 0.2 percent of players are responsible for 48 percent of all revenue.

‘Feel’ engineering

The video games are becoming more and more popular as they give an enjoyable experience and also leave behind a feeling of achievement in the player and make them play more. Gaming companies design their games with the end outcome in terms of feelings that it would like to generate amongst the players. This is called ‘Feel engineering’, which is likely to be an area of specialization.

Electric Energy

Let me come back to the topic of energy consumption that I discussed in my previous post and strengthen it with the emergence of eSports. One study discovered that gaming PCs collectively consumed 75 terawatt-hours of electricity in 2012. The country of Belgium consumes the same amount of electricity! Researchers believe this consumption in video games could more than double by 2020. I am sure with growing popularity of eSports the demand for energy will increase multiple times.

Are these addictive?

On the flip side, video games could be addictive. In May 2013, the American Psychiatric Association (APA) concluded that there was insufficient evidence to include Video game as an official reason for mental disorder. However, proposed criteria for “Internet Gaming Disorder” were included in a section called “Conditions for Further Study”. Video game addiction described by many others as an impulse control disorder, which does not involve use of an intoxicating drug and is very similar to pathological gambling.

Some theorists focus on presumed built-in reward systems of the games to explain their potentially addictive nature. Many video games, particularly massively multiplayer online role-playing games and social network and mobile games, rely on a “compulsion loop” or “core loop”, a cycle of activities that involve rewarding the player and driving them to continue through another cycle, retaining them in the game. The anticipation of such rewards can create a neurological reaction that releases dopamine into the body, so that once the reward is obtained, the person will remember it as a pleasurable feeling. This is like the neurological reaction that is believed to be associated with gambling addiction. Someone had said, “In the hypothetical world created by such games, the players become confident and gain satisfaction, which they cannot get in the real world.” Another reason why online video games are potentially addictive is because they “can be played all day every day” and there is no ‘logical end’ of the game. Some games require a large number of players to log on simultaneously, for long durations of time, to accomplish a game’s task. In such games, players feel an obligation and loyalty to other players. This is another reason given by players to play video games for long hours.

Opportunities for managers

The advances in video games because of VR/AR eg Pokeman-Go could be useful for businesses – to conduct meetings where one could see their colleagues sitting in one virtual conference room. The smart sensors would address the problem that we face today of partial attention due to distraction and multi-tasking. We already know about gamification of employee learning. The augmented VR experience might also be able to address the problem of lone employee in a geography. The workplace, although dispersed, would appear to be one virtually and would help in collaboration and social networking (virtual water cooler meetings!).

Concept of gaming or use of video games has not been fully leveraged by the businesses. If the millennial customers and digital natives are likely to have more affinity towards playing and watching video games and eSports, businesses could consider engaging their customers and potential customers through specially designed games that are aligned to their business. The experience of evaluating, buying and consuming (or experiencing) products and services could be augmented by developing a pre-determined different ‘feeling’ amongst the potential and existing customers. Would you like to think of using video games in the next strategy meeting? One more example of the role of Chief Innovation Evangelist/Officer.

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