Mark Cuban Believes Esports is a “Fueling Industry” for North Texas

May 31, 2018

Mark Cuban, the owner of the Dallas Mavericks and the NBA 2K League team Mavs Gaming, recently participated in a debate whether university esports programs should be housed in the athletics program. After the discussion, Cuban was interviewed by the Dallas Business Journal, where he stated his belief that, besides Silicon Valley, North Texas is the biggest hotbed for esports in the country.

“Literally, like oil and gas was a big industry for the region 50 years ago, 100 years ago, esports can be a fueling industry for this region,” said Cuban. “And I don’t know necessarily that a lot of our business leaders truly understand that.”

Photo Credit: Clutch Points

Cuban has a point. In addition to Mavs Gaming, the city of Arlington recently announced that it is helping to fund a $10 million renovation of the Arlington Convention Center into a venue called Esports Stadium Arlington. Jerry Jones, the owner of the Dallas Cowboys, and John Goff, a real estate investor, teamed up to acquire a majority stake in compLexity Gaming and moved the team’s global headquarters to The Star in Frisco. The Cowboys also have a team in the Madden NFL Club Championship, which kicks off in a few months.

In addition, companies that support and augment these new esports endeavors, like eGency Global, are becoming part of the North Texas scene.

Cuban is building a state-of-the-art Mavs Gaming home base designed by The Trade Group. The facility includes a mini esports stage, a broadcast suite, player warm-up areas, a locker room, and the ability to seat 1,500 people with room to expand. The multi-purpose space is designed to host esports tournaments, parties, receptions, meet-and-greets, and other events.

Cuban also recently made another foray into the esports world by investing $7 million in the competitive video game wagering start-up Unikrn (pronounced “Unicorn”). Currently, Unikrn’s wagering services are not legal in the United States (most customers are in the U.K., Ireland, and Australia), but the company intends to overcome the U.S legal issues soon.

Photo Credit: The Esports Observer

All in all, it does seem to indicate that a North Texas esports boom is underway.

Cuban talked about the amount of time it takes for his esport team, Mavs Gaming, to become profitable.

“Two years,” said Cuban. “It’s not expensive to start. It’s expensive to be great. One of the reasons I stuck to one sport is I want to try and be great at what we do. And there’s so many ups and downs in the profitability of all the different sports as you try to add each one. A lot of the league, a lot of the bigger teams are chasing these different things.”

The NBA 2K League recently finished its first tournament with the 76ers GC scoring a huge upset in the final over Blazer5 Gaming. The feedback for the first month of the league has been largely positive, with most praising the commentating and the Twitch presentation – although a common complaint is a lack of on-screen stats.

Photo Credit: NBA 2K League YouTube

Twitch has stated that it intends to create extensions, such as interactive custom overlays, that will provide fan engagement opportunities and further enhance the live-game-viewing experience.

This statement was made at the start of the NBA 2K League season when it was announced that Twitch would serve as the exclusive home for live streaming of all NBA 2K League games. Twitch will stream up to 199 games throughout the 17-week season (the inaugural season runs through August), including the three in-season tournaments, playoffs, and the league finals.

This season the NBA 2K League includes 17 teams, each tied to an existing franchise:

Photo Credit: Daily Mail UK

When NBA Commissioner Adam Silver attended the NBA 2K League draft in New York, he held a press conference where he predicted that the league could expand to all 30 NBA markets within three years, and that overseas expansion is a possibility as well.

This should not come as much of a surprise. The NBA is hugely popular in America, and its popularity is climbing abroad. In China, for example, each NBA 2017 Finals game averaged 20.4 million viewers and an additional 430,000 live-streamers.

It will be interesting to see how viewership evolves for the NBA 2K League as players are interviewed more and they become known for their personalities as well as their play styles. Apparently, much of the community is already targeting the number one pick in the draft, Dimez of Mavs Gaming, as a favorite player to hate on, and the number two pick, oFab of CLTX Gaming, is emerging as more of a favorite.

It was recently revealed that the esports industry had its best quarter ever earning almost $2 billion in disclosed investment funding. $2 billion is more than the esports industry earned for the entirety of 2017 – and that amount actually exceeded expectations. Digital research firm SuperData estimated that the esports industry would bring in $1.1 billion in 2017. When the final number was tallied, it was closer to $1.5 billion.

Photo Credit: Games Industry

Investors accounted for 50 percent of that $1.5 billion worldwide esports market, but advertisers were close behind at 35 percent. The remaining portion is comprised of prize pools (6 percent), merchandise and ticket sales (5 percent), and betting and amateur tournaments (5 percent).

When asked how he saw sponsorships playing out for sport-related titles, like NBA 2K, Cuban answered that sponsorship opportunities are likely to mirror current arrangements in traditional sports.

“I think the revenue streams for sponsorships will mirror them as it grows relative to player participation,” he said. “Player access I guess is just as important. Because, again, you have a publisher trying to own those things. Whether it’s Epic, whether it’s Blizzard, whoever it may be, they want to have as much control as possible and own the game through micro transactions. They let people keep their own money from streaming now. Who knows what’s going to happen in the future. It really comes down to the relationship between publishers and the participants and the professional organizations.”

For more on our thoughts about the expanding esports scene or planning for the ideal esports headquarters, give an eGency Global expert a call at 972-323-6354.