Are Franchised Esports Leagues the Way Forward for Southeast Asia?

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Musical artist Zed performs in the 2019 Overwatch League Grand Finals. The Overwatch League operates on a franchise model. (Photo: Bill Streicher-USA TODAY Sports via Reuters).

Moonton, the games company now owned by Bytedance, needed a fatal blow to its mobile MOBA game, Mobile Legends: Bang Bang.

Rival Riot Games launched Wild Rift in the Southeast Asian market in 2020, where MLBB had experienced unprecedented success. Specifically, Riot had targeted the Philippines, a market where MLBB had seen steady growth. The release saw the game topped the Google Play Store chart in the Philippines and has since been downloaded more than 38 million times worldwide.

However, as of the date of this article, Wild Rift appears to have disappeared from the Philippines App Store and Google Play Store rankings for downloads, and is also slowly falling in the revenue rankings.

Meanwhile, esports in Southeast Asia is expected to grow rapidly, mainly thanks to mobile games. A Tencent-Newzoo white paper suggests that the region’s revenue will increase from US $ 39.2 million in 2021 to US $ 72.5 million by 2024. By the end of 2021, 42.5 million of esports viewers would come from this region, mostly focused on games like PUBG Mobile or MLBB.

The data reflects MLBB’s dominance in Philippine app stores. The game is still in the download rankings, with winning rankings in second place, behind CoD: Mobile. To seal the deal, Moonton pulled out something from Riot’s playbook, and something he had already used in Indonesia in 2019: franchise leagues.

With the launch of the eighth season of the MLBB Professional League (MPL), the new franchise offers participating teams the hope of earning a share of the $ 8 million in revenue that could potentially be made. Interestingly, Moonton did not disclose the purchase costs for PH, unlike Indonesia, where teams could participate as long as they could shell out US $ 1 million. And the Philippines is just the beginning, with franchise leagues from Malaysia and Singapore in the works, according to Moonton spokesperson Kelly Chiew.

“We want to help the esports ecosystem thrive and become more sustainable for players, organizations and the community itself.” said Chiew.

We are extremely passionate about esports and having a franchise league unlocks revenue and benefit sharing to help financial stability of players and teams.Moonton spokesperson Kelly Chiew

Chiew also added that organizations could also partner with others to secure a location, allowing them to form a team while maximizing their use of a location, while maintaining branding.

Interestingly, despite the exclusivity rumors, Moonton said it wasn’t. According to Moonton, esports organizations are free to join as many games as they want. Players can also participate in other games even if they are playing in a franchise.

However, if their organization chooses to enter into a revenue sharing agreement with Moonton, players on the team will not be permitted to participate in other games unless they are replaced during the appropriate transfer periods.

Eager to join

And it looks like esports organizations are keen on moving to franchise leagues. RSG CEO and Founder Jayf Soh said he’s excited for this to happen, especially if it opens up to different games from other developers.

“The growing emphasis on localization has enabled local leagues to perform much better now, as it allows for better engagement on the pitch.” said Soh, whose team recently ventured onto the Philippine MLBB scene.

The challenge here is to centralize with sufficient autonomy to be able to further develop the audience base without limits.Jayf Soh, founder and CEO of RSG

Soh also added that a side effect was that due to the structure of the franchise, organizations could only field one team, which may “translate into fewer opportunities to develop new players, and may eventually become restrictive ”.

However, he is in favor of the franchise model, saying that it would provide a sustainable ecosystem, but that a multi-game franchise will be difficult for organizations to balance their resources.

EVOS Strategy Business Development Manager Matthew Chan said it was great that the developers put in the effort, adding that the franchise league his organization participates in is performing “fairly well”. EVOS currently has teams in Malaysia, Indonesia, Thailand and the Philippines.

“Of course there have been situations where you get into the regional leagues and it’s EVOS versus EVOS, but I think it depends on how you see it,” Chan said. “From our point of view, we are able to create jobs in different countries.

Chan also added that due to the limited number of places in franchises, the competition would be fierce, which would provide a better viewing experience for spectators. Esports organizations, he said, would do well to consider the best country to build their base in, “focus their infrastructure a lot more” and “invest properly in a team.”

Fans attend the League of Legends (LOL) World Championship final in Shanghai, China on October 31, 2020 (Photo: Reuters)

Fans attend the League of Legends (LOL) World Championship final in Shanghai, China on October 31, 2020 (Photo: Reuters)

Will Riot be franchised?

Riot, on the other hand, doesn’t seem to want to talk about franchised regional leagues yet. The game developer is already holding official Wild Rift tournaments in the region through a partner, in this case PGL, but said it does not have any plans yet although it has already established the model with his League of Legends e-sports.

“We’re very, very interested in creating a sustainable ecosystem. When I think about why franchises exist, that’s one of the ways to create it,” said Justin Hulog, CEO of Riot Games for Southeast Asia and Taiwan.

Hulog added that there are three components to a successful sustainable gaming ecosystem, the first being the player’s experience when engaging with a product.

That meant there had to be a compelling reason for them, like exciting matches, tournaments, or even world-class shows, Hulog explained. It’s also something Riot is focusing on for Wild Rift right now, to make it a global product.

The second reason was to make sure that Riot had teams in place to support and develop the game. The third reason was team participation. Hulog said the key point for the teams is financial stability. It means generating income through sponsorship or winning tournaments.

We will not exclude deductibles. Franchising is definitely a path, but first we need to make sure our ecosystem is strong and then we will be able to assess whether franchises make sense.Justin Hulog, Managing Director of Riot Games for SEA and Taiwan

And when franchise leagues happen for Riot, chances are there won’t be any planned exclusivity bundled. Reiterating his take on creating a healthy ecosystem for talent, Hulog said Riot will not place any restrictions on professional Wild Rift players who want to participate in multiple games.

“I think the tactics that sort of create exclusivity are incredibly disappointing things, and the only people who get hurt are the players.”

Aloysius Low is a former CNET editor with over 15 years of experience. He really loves cats and is currently reviewing the products on canbuyornot.com

For more information on esports news, visit https://yhoo.it/YahooEsportsSEA and check out Yahoo Esports South East Asia Facebook page and Twitter.

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