The exodus of teams from CSGO: Is it time to think about franchising?

May 2, 2018 | 0 | 2183| |

Splyce recently announced their decision to leave the Counterstrike scene. The decision was due to their desire to focus on other esports titles. The decision did not really come as a surprise since the team was pretty much one of the lower tier teams in the NA scene. However, it does bring up the discussion on the financial viability and business model for Counter-Strike organizations mainly in North America.

The Player Salaries in North America are Skyrocketing

The North American region is one of the biggest markets for esports. Despite not always fielding the most talented players in the world, the events in this region are very successful. Almost all the big game developers are from North America and their primary focus remains the local audience.

Specifically for Counter-Strike, the North American region was a meme for a long period of time. A few years ago, Cloud9 winning the Major would be a laughable thought. Ofcourse the team proved their detractors wrong with their amazing performance at the Eleague Boston Major. The top tier of North American counter Strike has improved tremendously and can compete against the best teams in the world.

However, Cloud9 and Liquid present the very best of North American Counter-Strike. The majority of the professional scene in North America lacks the talent to compete with the European region at the highest level. There is a definite lack of talent in the region which is highlighted by the poor performances as we move down the tiers of North American Counter-Strike.

Sports organizations joining Esports is great news, but it’s driving up costs

The biggest reason for the huge increase in player salaries remains the big investments coming into CS GO. Counter-Strike is the face of esports for many with its simplistic gameplay and ease of watching. The huge viewership numbers in Counter-Strike are a testament to this popularity of the game. But as regular sports organizations realize that sports are declining across multiple segments, they are turning to investments in esports.

The Philadelphia Fusion invested in Team Dignitas

The salaries in the region, however, present the biggest changes over the years. An average EU player would receive 800 monthly salary back in 2012. However, as we look at some rumors and leaks from last year, the salaries have touched around 20000 for some teams.

Traditional sports are seeing lower figures across various sectors. From declining ticket sales, less merchandise revenue and low attendance, the numbers don’t look great for traditional sports. At the same time, esports is projected to be a massive industry within the next few years. The sports organizations are moving towards the next best growth potential, esports. There are several factors which make esports a lucrative investment opportunity.

As we see more investments from these big organizations, they are investing huge amounts of money in the scene. These amounts might not be big by their standards, but they are definitely very big by esports standards. The huge investments are driving up the player salaries and buyout prices. Endemic esports organizations cannot often keep up with the huge investments from big organizations. Traditional sports teams are ready to throw lots of money at esports and reap the rewards in the next few years.

Splyce’s decision is the correct choice

Splyce recent decision to quit CS GO comes on the back of a $1.5 million Ledger Group investment. The organization made the right decision as Splyce has never been a strong team in Counter-Strike. Apart from a surprise appearance at MLG Columbus 2016, Splyce has mostly been unsuccessful.

But with the rising player salaries in the region, their decision to quit CS GO makes more sense. They have not been a team which has a huge fan base in Counter-Strike. They were essentially paying their players without any potential for a corresponding source of income. Recently, we also have had several NA teams changing their approach to the game. CLG let go of their male roster and Optic decided to go for a fully Danish roster. CLG is an organization which was much more successful and had a loyal fanbase in the NA region as well. Their decision to let go of the roster was a huge surprise.

Streamlining your organization’s resources and man hours into the games where they have the potential for better performances makes more sense. Part of the reason for the poor Splyce Performance remains the huge player salaries in the region.

It’s time for Franchises in CS GO

Counter-Strike is increasingly popular as one of the easiest to understand esports games. The simple shoot to kill motto of the game makes it appealing to new viewers and players alike. However, despite the lack of game updates from the developers, the game has repeatedly broken new viewership records on Twitch. Eleague Boston Major set a new Twitch Viewership record as it surpassed a previous self-held record for the most concurrent viewers.

Eleague Boston Major + Twitch
The Eleague Boston Major broke new records on Twitch

The lack of returns for smaller organizations is what makes Counter-Strike extremely problematic for many. With the huge number of viewers, there is no doubt about the interest in the game. But the team owners have long wanted a franchise system in Counter-Strike. It would help solve many problems within the game.

Esports is moving towards a franchising route and a more structured system. Out of the top 4 esport titles, three already have a structure in place. Riot and Blizzard have taken the initiative to enable franchising in esports. They have brought in huge amounts of investment, especially from non-endemic sources. Valve which is usually hands-off with their games has intervened to provide a schedule and a structure to the extremely chaotic Dota 2 scene. They have definitely brought in a lot of stability, although there need to be further modifications to the DPC system.

So why is CS GO being ignored right now? Without any game updates, the lack of structure in the esport title is definitely worrying. Valve need to provide a support system to the tournament organizers who have been crying aloud for the same.

Tournament organizers should take matters into their own hands

It is almost certain that Valve is not going to discuss franchising with the tournament organizers. As such it falls upon the tournament organizers to take matters into their own hands. Several of the tournament organizers share a common investor in the form of MTG. The various tournament organizers need to come together and decide on a fixed schedule for the entire year. While Franchising would be out of the question, since Valve owns CS GO IP; ensuring a stable format along with adequate player breaks is important for all parties concerned.

Jack Etienne during Coud9 Eleague Boston win
Cloud9 Founder and CEO advocates for franchising in CSGO

Valve, please build us some sort of permanent partnership, franchise, something like that! I would love it. I think that sort of stability would be fantastic for our players. And if Valve doesn’t build it then I think it’s up to determine our operators and teams to build something for ourselves.

-Jack Etienne

There are ongoing efforts to form player unions in Counterstrike. With time, we expect the various parties to come to the table and have meaningful discussions about the future of the CS GO scene. In its current state, CSGO remains extremely volatile and is very exhausting for players and talent.

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The author

Esports journalist. An esports fan, former wannabe pro and occasional angry young man. You can find him trying to climb the Dota 2 MMR or just chilling in Rocket League. Or maybe building an entire city in Cities: Skylines. The current mood is always a surprise.

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