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This month, we’re looking at sports tech applications for esports and virtual sports.
‘Esports’ is often mistakenly used as the catch-all term for anything relating to video games or competitive online events. So, it’s worth clarifying some of the nuances across the unique areas of esports, virtual sports, streaming and social gaming.
The term ‘esports’ is usually reserved for competitive video gaming. The most popular game titles – by tournament size and prize money – are Dota 2, Counter-Strike: Global Offensive (CS:GO), Fortnite and League of Legends (LoL). These titles cover genres across action role-playing strategy (ARTS), third-person shooter (TPS) and first-person shooters (FPS). The strongest market for esports globally is Asia. Shanghai-based Edward Gaming recorded an upset victory in the 2021 League of Legends World Championship, against tournament favourites, Damwon Gaming, a Korean powerhouse team that won the annual event in 2020. Thousands of fans flooded the streets across China in celebration of the win, highlighting the obsessive fandom in the region.
I was also shocked. People in the outdoor shopping mall shouted the slogan of EDG as they looked at the huge display screen standing in front of them. Chinese fans love e-sports beyond imagination It’s like watching a game offline pic.twitter.com/YWvF3tMHhC
Esports functions in the same way as traditional sports in identifying and developing talent from a young age. So, the Chinese government’s new restrictions for players aged under 18 to only three hours of weekly video gaming could potentially kill the country’s ambition to become a global esports dynamo. A 2017 report by ESPN found that esports athletes are significantly younger than their counterparts in traditional professional sports, making access to younger talent even more important for the success of professional teams.
Although some traditional sporting purists may deride esports athletes as undeserving of the ‘athlete’ nomenclature, there is a quantifiable mental and physical strain caused by competitive gaming. As with traditional sports, there’s a growing market of companies using technology to achieve the highest possible physical and mental performance for these athletes.
For example Statespace, the esports performance-focused company, is taking principles from neuroscience and applying it to competitive video gaming. Its main platform, Aim Lab, is a program that trains new players how to aim properly in first-person shooters. The software uses data science to learn where players excel, where they need to improve and then adapts in real-time to create custom and personalised training programmes.
Aim Lab’s user base has grown to five million monthly active users (MAU) and 20 million total players in September 2021, up from just 100,000 MAU and 1.5 million total players 18 months ago. The company raised US$50 million this year to expand its offerings to health diagnostics and treatment with early clinical trials focused on cerebral palsy and brain concussions.
Virtual sports are video games based on traditional ‘real-world’ sports. In its purest form, they replicate, as far as possible, the skill or physical activity of traditional sports but in a digital setting.
This year the International Olympic Committee (IOC) hosted its first-ever virtual sporting event, the Olympic Virtual Series (OVS), where competitors played in virtual versions of five different physical sports. The international sports federations and game publishers that partnered with the IOC to produce the OVS were:
According to IOC president Thomas Bach: “The Olympic Virtual Series is a new, unique Olympic digital experience that aims to grow direct engagement with new audiences in the field of virtual sports.”
Notably, the cycling and rowing events are the only two out of the five which require players to compete on physical hardware that mimics the physical effort of the sports in their normal settings. Conceivably as virtual reality (VR) and augmented reality (AR) technology develops we could see further sports replicated in a digital setting without needing to take away the requirement for physical effort.
The OVS was not the first successful foray by a major sporting entity into virtual sports. Due to the Covid-19 pandemic, races during the 2019 Formula One season were cancelled or postponed. The F1 Esports Virtual Grand Prix provided a huge opportunity to fill the void for the sport’s existing fanbase whilst bridging the gap to new fans.
Using the official Formula One 2019 PC video game developed by Codemaster on gaming racing rigs, a mix of Formula One esports athletes, professional drivers and celebrities raced around Bahrain’s Sakhir circuit. The first race was won by Renault’s Chinese test driver, Guanyu Zhou, beating out professional Formula One racers Lando Norris from McLaren and Nicholas Latifi of Williams. The debut virtual event pulled in 3.2 million online viewers and allowed Formula One to deliver value to sponsors by transferring existing sponsorship assets to a virtual setting.
For a sport such as Formula One that is incredibly inaccessible to the average fan (they can’t go for a hot lap of Monaco in a US$12 million super car) the virtual product brings them closer to the action and deepens that engagement with the sport.
Streamers are entertaining personalities with large online followings. They’re usually highly skilled game players but also aren’t necessarily the best in the world. An example is Tyler ‘Ninja’ Blevins, who is arguably the highest profile Fortnite streamer ever, but failed to qualify for the finals of the 2019 Fortnite World Cup. The eventual winner of that tournament was Kyle “Bugha” Giersdorf, a 16-year-old American who took home US$3 million in prize money. For a quick comparison, the singles champions of Wimbledon won UK£1.7 million (US$2.4 million).
A reductive analogy in traditional sports would be that esports athletes are on an NBA team, streamers are the Harlem Globe Trotters, and social gaming is playing a game of pick-up ball at your local gym or court. This analogy falls apart the deeper you dive into it, but so do most analogies drawn between esports and traditional sports. Esports is a unique beast and efforts to shoehorn it into the structure or terminology of traditional sports usually fail.
Kyle “Bugha” Giersdorf won the Fortnite World Cup in 2019
One of the most common inexact explainers is game publishers being equated to sporting leagues or federations. The total control exerted by game publishers on their product and IP is radically different to what teams, leagues or governing bodies can realise. A more accurate analogy would be if the National Football League (NFL) not only administered the rules of football but were the only manufacturer of footballs, shoes, pads and goals (not just licensed products, but the basic products themselves).
Game publishers are not necessarily incentivised to grow the professional league value in the same way traditional sports leagues are. The majority of free-to-play Battle Royale game publishers are focused on bringing people onto their game title and then keeping them there to generate revenue from in-game microtransactions. According to Sensor Tower, Chinese publisher Tencent’s PUBG Mobile earned US$1.6 billion in the first seven months of 2020 alone and Fortnite Mobile earned close to US$300 million in the same period.
To this end, game publishers are better suited to focusing on creative, unique in-game social and ‘metaverse’ activations to engage their players as participants rather than just professional tournaments as spectators. The success of Fortnite’s immersive Travis Scott concert was heralded as a landmark moment in the industry. The concert had 12.3 million concurrent viewers/players, 28 million unique views, 46 million total views and grossed the rapper roughly US$20 million including from fully digital merchandise sales.
Current video game titles are categorically not the metaverse, but Fortnite is one of the closest, most tangible glimpses of what could be possible. In his influential thesis on the metaverse, Matthew Ball references Fortnite heavily.
‘Fortnite is one of the few places where the IP of Marvel and DC intersects,’ he writes. ‘You can literally wear a Marvel character’s costume inside Gotham City, while interacting with those wearing legally licensed NFL uniforms. This sort of thing hasn’t really happened before. But it will be critical to the metaverse.’
The unique position of Fortnite as a place for brands, including sports entities, to intermingle is coupled with Epic Games’ game engine, Unreal, which powers many of the notable AR and mixed reality innovations in sports and entertainment – see last month’s expert guide on media and broadcast for examples.
Epic Games highlights that technology and innovations developed for esports and virtual sports can transfer across to traditional sports as the lines between physical and digital experiences continue to blur. Whether you’re looking at esports and virtual sports or streaming and gaming, the collective of these activities continue to break down the silos between traditional media and entertainment verticals, especially sports. It’s an innovation testbed not shackled by many of the legacy issues in traditional sports and as we slowly move towards a realisation of the metaverse, it’s these game platforms leading the way.
Fortnite has offered glimpses of what could be possible in the metaverse
The past 18 months have seen the maturity of offerings to support the continued growth and professionalism of esports and virtual sports. Companies creating solutions in skills training (physical and mental); competition and event organisation (grassroots to pro); analytics; and wagering/betting have been standout successes. Below is a sample of some innovative companies offering solutions focused on esports and virtual sports.
FACEIT
Esports league and tournament operations
World’s biggest independent competitive gaming platform, with more than 22 million users competing in over 20 million game sessions each month. FACEIT allows players to easily join competitions and leagues for virtual and real-world prizes through automated tournament management and matchmaking technology.
Mission control
Esports league and tournament operations
Mobile app where gamers can join recreational esports leagues, similar to their local adult softball league or college intramurals but for video games. Mission Control manages the league schedule, validates scores, and determines the champion while also serving as a forum for league members and friends.
Toornament
Esports league and tournament operations
Professional-ready solution for esports organisers and game studios to create, manage and share their competitions. Available for all competitive levels, from professional to occasional tournaments.
Statespace
Esports coaching
Using cognitive science and artificial intelligence to improve esports performance, Aim Lab replicates the physics of popular video games to give users a training environment to practice their aim whilst measuring visual acuity. AI identifies users’ strengths and weaknesses and provides a customised training programme. Statespace previously partnered with the Pro Football Hall of Fame to develop a ‘Cognitive Combine’, giving players an overall score based on a wide range of skills outside of any specific game.
Gamer Sensei
Esports coaching
Video game coaching platform ecosystem offering professional coaching for nearly 20 different popular esports titles including League of Legends, Overwatch and Fortnite.
Cavea
Automated sponsorship analytics for esports
A fully automated tournament tracking system for brand detection and optical analysis of brand placement.
Edge
Smart contract and payment platform
Sponsors connect data to Edge’s smart contracts which link contractual obligations to a player or influencer’s reach and content results. If the player or influencer hits their metric it automatically processes the payment. Overcoming issues prevalent in esports, including late payments, questionable contracts and exit scams.
Sizzle
AI-powered game highlights
Web service that leverages AI to automatically create gaming highlights from Twitch and YouTube videos. Sizzle can automatically convert a 20-minute gameplay video into a ‘sizzle’, or a five-minute condensed game, with all of the highlights in chronological order.
Gamescorekeeper
Esports data provider
Collect data from more than 30,000 matches and cover more than 1,100 leagues and tournaments every year. Clients range from betting operators to media companies and fantasy leagues.
Pandascore
Esports data provider
Provider of real-time statistics for esports using artificial intelligence.
Rival.ai
Esports ranking and scouting /data provider
Utilising machine learning systems to interpret, analyse and report first-party data based on in-game action.
Zwift
Virtual cycling platform
Massive multiplayer online cycling and running physical training program that enables users to interact, train and compete in a virtual world. Zwift mixes the intensity of training with the immersive and engaging play of gaming. Their app connects to a bike or indoor trainer to record physical output.
NextMind
Brain-sensing wearable
Brain-sensing wearable that delivers real-time device control using just
a person’s thoughts. NextMind’s technology translates brain signals from the visual cortex into digital commands in real time. The small, lightweight device fits into the back of a cap or headband. It captures data from the signals created by the user’s neuron activity in the visual cortex, and using ML algorithms, transforms that output into communication that enables easier interaction and control of computers, AR/VR headsets or any device.
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Thanks for reading the fifth instalment of a monthly series examining the world of sports technology, brought to you by Thomas Alomes and the team at Sports Tech World Series.
In each column, we will provide insights into the global sports tech market drawn from our latest industry research, consulting clients and expert interviews. Our aim is to quickly inform you on what’s happening in the industry now, where it’s heading in the future and who are the major players, both emerging and established, operating at the cutting edge of this exciting space.
To make more sense of sports tech, we have classified the industry into sub-categories. Having covered esports and virtual sports in this edition, the different areas being covered in this series are:
Solutions designed to improve the efficiency and customer experience in stadiums and venues.
Devices and platforms used to measure or track athletes with the purpose of testing and improving performance.
Solutions that support the management of athletes, teams, leagues and events, with a focus on improving overall efficiencies at an individual and organisational level.
Solutions focused specifically on the unique challenges of betting and fantasy sports.
Data processing, capture and analysis solutions that support insights and decision making for a variety of sports related organisations.
Solutions focused specifically on the unique challenges of esports and gaming.
Solutions designed to enhance and improve the experience of the fan, or increase the value for the sponsor, including memberships and social media engagement.
Solutions that enable and enhance the sharing and distribution of sports content such as streaming platforms, automated broadcast graphics and online content publishers.
About STWS
Sports Tech World Series (STWS) is the trusted resource in the global sports technology ecosystem. We provide research, consulting and market insight services to help teams, leagues, governments, investors and vendors to achieve results and meaningful impact over the hype in sports technology and sports innovation.
About Thomas Alomes
An industry consultant, researcher and speaker, Thomas Alomes is a global leader in sports technology ecosystem growth and development with a passion for connecting the best people with the best ideas. He is currently head of North America at STWS and the founder of Sports Innovation Texas.
